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The First Choice Business Brokers Coral Springs Buying Process

Image of business people shaking hands and celebrating that an agreement has been reached

11 Steps to Buying a Business: The FCBB Way

1.Once you have determined you want to run your own business schedule an appointment to meet with a First Choice Business Sales Professional.

2.During your appointment with your First Choice Business Sales Professional you will be asked a series of questions to help your Agent understand better what type of businesses they should show you.

3.Know how much money you are working with. Some business owners will offer terms which means you can leverage the money you have to buy a larger business which will likely bring in a greater income. Be honest with your Agent so they know what businesses to show you. It is OK to receive money from a relative to help buy a business. Be prepared to provide proof of funds. Many Sellers won’t disclose confidential details without knowing you are able to complete a transaction.

4.Have an open mind when looking at businesses. There are so many different types of businesses that you may not even be aware of.

5. Be prepared to sign a confidentiality agreement commonly referred to as an NDA. The NDA protects the Seller against Buyers who take their confidential information and start a competing business using that same confidential information. Business Brokers are required by Sellers to have this agreement signed before providing intimate details about the business.

6. Once you determine you have an interest in a particular business your FCBB Agent will arrange a meeting with the Seller for you to view the business (often before or after the business hours of operation) and discuss the business further directly with the Seller.

7. After your meeting with the Seller your FCBB Agent will likely ask you if you would like to proceed to the next step in purchasing the business. By this time you may have seen the financials and are prepared to make an offer. If all the books and records have not been made available you may still place an offer on the business and request that those items you would like to see be produced through the process known as “due diligence”.

8.Writing an offer to purchase a business is not as difficult as you may think when you are working with a First Choice Business Sales Professional. Our experts utilize the most comprehensive proprietary Purchase Agreement in the industry. FCBB Agreements were designed to protect ALL the parties involved in the transaction covering simple items like the assignment of lease (for you to take over the business location) to more complicated issues such as key employee negotiations. You will be asked to give an Earnest Money Deposit (a.k.a. EMD) check typically in the amount of 10% or$10,000 whichever is greater. This check is not deposited with the third party closing entity unless the offer is accepted by the Seller.

9. Your FCBB Agent will present your offer to the Seller, if the Seller accepts your offer then you will move into the due diligence phase where you will have a chance to thoroughly review the items you requested to meet with your approval. If you do not approve of the information provided during the due diligence period, you have the right to withdraw from the transaction and receive your EMD money back.

10.Once your contingencies and due diligence have met with your approval you will be asked to sign a release which will take you to the final step of the process which is closing/business transfer.

11. A third party entity (escrow/title company or transactional attorney) will prepare the final transfer documents and obtain clearances for taxes etc. so you are receiving the business free and clear of all encumbrances (except those that you may be taking over through your agreement such as a copier, leased phones etc.) . Congratulations, you just bought a business.

Buyer’s Frequently Asked Questions (FAQ’s)

What is Due Diligence?

Merriam-Webster Dictionary defines due diligence as “research and analysis of a company or organization done in preparation for a business transaction.” What this means to you as a Buyer is that this is your opportunity to make sure that the business is what you were presented with originally.

Why should I buy and existing business instead of starting my own?

There are a number of very logical reasons why purchasing an existing business has a greater risk-to- reward ratio than starting a business. Those reasons include a proven concept and/or product; with an existing business you can already see the business concept works. Established location, employees in place and quicker return on your money are just a few of the many other reasons why buying an existing business is likely the right choice for you.

Why should I use a Business Broker to buy a business?

Business Brokers can introduce you to many more businesses than you would find on your own. Business Brokers are most commonly paid by the Seller and will save you time and money. Business Brokers help structure the offer and act as a negotiator/buffer between the Buyer and Seller. In particular FCBB Agreements were designed to protect ALL the parties involved in the transaction covering simple items like the assignment of lease (for you to take over the business location) to more complicated issues such as key employee negotiations.

Will I be able to obtain financing to buy a business?

These days’ bank loans are fairly difficult to obtain especially without prior experience in the business you may be looking to buy. Seller Financing has increasingly become the “norm” as a financing option.

How do I make an offer on a business I want to purchase?

Your First Choice Business Sales Professional will help you navigate through the buying process one step at a time. With a First Choice Agent you can take advantage of the FCBB Agreements which were designed to protect ALL the parties involved in the transaction. Our agreements cover the things that are easy to miss to the more complex situations that we have seen come up over the last 20 years.

Do I need an attorney?

It is your option to have an attorney review the purchase documents; in fact, your First Choice Business Sales Professional will likely suggest it.

How do Sellers come up with the price they are asking for their business?

If the Seller is represented by a Business Broker the Broker likely used one or several industry suggested pricing methods. For example the price may be based on a multiple of income or a combination of income and the assets of the business. Business Brokers, based on experience, do their best to price a business so that it makes sense to a Buyer and still fulfills the Seller wishes creating a win-win situation.

Aren’t most businesses for sale losing money?

No, there are many reasons why Sellers want to sell. For Example, retirement, disability, death, divorce, partnership dissolution or plain and simple burn out.