There is a third formula, quite common, which is the transfer of a business in operation.
All of these options have their advantages and disadvantages.
Here are some of the things you need to consider before taking over a business through a transfer:
Even if they tell you that the business is working well and profitable, they must give you access to the accounting records for complete verification. It is important to rule out the existence of hidden costs and, in general, errors that you would have to assume.
It is advisable to carry out a market study to understand the local marketing email list real potential of the business and assess whether the price being asked for the transfer is justified.
By accepting a transfer, you gain a loyal clientele, a consolidated brand , furnished and equipped premises, even with the necessary stock so that work is not interrupted with the change of owner.
It may also include debts and expenses that must be explicitly stated when signing the contract. Before accepting, you must know all the outstanding debts that you may have to take on and check what collateral has been offered as security, which may include assets that you are acquiring in this transaction.
The staff that were in place before the transfer will keep their contracts and acquired rights, and you cannot get rid of them simply because of a change of ownership. Check that there are no debts on their salaries or their Social Security contributions. Experienced staff will help you to maintain the business, but if there are previous debts and you do not check them before accepting the transfer, you will have to assume them as your own.
Ask the tax authorities for a certificate of tax debts, because if they exist and are not paid by the previous owner, they can legally require you to pay them yourself.
Transferring a business can save you the cumbersome procedures for building permits and give you access to a business in an area with a high demand for premises. Check that the license is up to date and adapted to the uses of the premises. Also check whether you can obtain a building permit for any possible adaptation you want to make.
The success of the business may be due to the previous owner. Don't enter a sector you don't know unless you surround yourself with an efficient team that knows how to help you manage it.
A transfer can put a business that is already operating in your hands , so you can recover your investment within a reasonable period.
But always and obligatorily, check that you have complete knowledge of the investment you are about to make. It is important.
