Posted by: admin in Business,General,Investment,Services on March 6th, 2010

Before buying an enterprise, it is important to take some legal advice and avoid making hay by snapping up every business that is for sale. As a buyer, it is a major factor to do some research before agreeing to take over a business to make sure you do not end up with a lemon. Protect yourself with these tips:

1 Conduct due diligence. Carefully examine the seller’s financial statement and records. Have your lawyer and your accountant look into the profit-and-loss records, tax returns, and balance sheets for the past years as well as into the current receivables. Have the business appraised including its assets, inventory, and brand. This will provide the basis for the offer that you will make to the seller.

2 Consult experts. Make an accurate assessment and forecast for your business by drawing people who own the same kind of business. Have an attorney and an  accountant on board and consult them every steps of the process to avoid irreversible and costly errors.

Consider franchising. Carefully evaluate the franchise locations and find out if any lawsuits are pending against a franchiser before buying a franchise. The advantage of buying a franchise is that it has a proven profitable business system and is ready-made.