Purchasing and running a second business
Discussion
Afternoon all, firstly apologies I've been a chronic lurker and this isn't perhaps first post fodder however, I'm looking for a little bit of advice .
Since the age of 16 I have ran my own business (I'm currently 26) , it has got to the point now where the business has the expertise and the structure to ensure it is pretty much self running and I only need to put in a couple of days a month to do the actual work. Unfortunately I will always have to do the core of the work as it is my personal background, experience and talent(?) that the clients are buying however all the day to day running, office and sales work etc is ran by my very small team of competent staff .
I have been looking at the scope for purchasing a second business with management already in place that I could do one / two days a week with along side my duties for the original business.
I'd be interested to hear from any one who has been through the process of purchasing a business as the process seems to be littered with obstacles and some selling agents that from the out side seem very dubious where everything simply seems to be too good to be true. Also I'm concerned that I may be being a little naive as to how realistic my plan is to be able to buy an managed and buoyant business and only spend a couple of days a week on it (my main thought is why would any one want to sell a profitable business thats requiring minimal input).
Finally I'd love to hear from any one who currently runs two business in different sectors as to how you manage your time and different teams.
I know this is limited information to go on however I'm keen to maximise my fortunate situation and make the most of my time while I'm still young(ish) and keen to work. That said I don't want to end up in a position where I am having to compromise my original business (and dream job) to 'save' the investment I've made in a secondary business.
Thanks for the Help
Dom
Since the age of 16 I have ran my own business (I'm currently 26) , it has got to the point now where the business has the expertise and the structure to ensure it is pretty much self running and I only need to put in a couple of days a month to do the actual work. Unfortunately I will always have to do the core of the work as it is my personal background, experience and talent(?) that the clients are buying however all the day to day running, office and sales work etc is ran by my very small team of competent staff .
I have been looking at the scope for purchasing a second business with management already in place that I could do one / two days a week with along side my duties for the original business.
I'd be interested to hear from any one who has been through the process of purchasing a business as the process seems to be littered with obstacles and some selling agents that from the out side seem very dubious where everything simply seems to be too good to be true. Also I'm concerned that I may be being a little naive as to how realistic my plan is to be able to buy an managed and buoyant business and only spend a couple of days a week on it (my main thought is why would any one want to sell a profitable business thats requiring minimal input).
Finally I'd love to hear from any one who currently runs two business in different sectors as to how you manage your time and different teams.
I know this is limited information to go on however I'm keen to maximise my fortunate situation and make the most of my time while I'm still young(ish) and keen to work. That said I don't want to end up in a position where I am having to compromise my original business (and dream job) to 'save' the investment I've made in a secondary business.
Thanks for the Help
Dom
Oh how I wish I had started my first business when I was 16! It sounds as though you are in a great position and I think your idea is sound.
I own three small businesses, only one really relies on my day today in put. The first I started in 2003 but haven't actually 'worked in' since 2005. A second was acquired by the first last year. And the third was a small MBO in a completely different sector. We are currently looking to try and do another acquisition to add to the first two companies I mentioned, a bolt on.
My experience with business transfer agents is that they are a mixed bag. The big guys have thousands of companies on their books and do very little for them. I once inquired about one business that was on the website of one of the larger agents only to be told that the last entry on their files was four years ago! The smaller guys, who only have a handful of normally higher value companies on their books do a much more thorough job.
My first real attempt to buy a business failed despite agreeing a price due to my own timidity and the lack of effort on the agent's part. Basically the vendor ended up practically giving his business away because he thought I had lost interest when in fact both parties were waiting for the agent to contact us.
More recently we completed a transaction through RTA and to be fair to them they did a good job once they knew they had a good chance of a deal coming off. The vendors have also been good as gold and really made sure it has worked for us.
As for the reasons for sale, smaller businesses will often be retirement sales but in some cases people just can;t see any further prospect of growth without investment that they are not willing to make. In one case I visited a business were they guy had been running it fairly profitably for ten years but could never take more than a day or two off work. He had just had enough. I look for two man businesses which are run inefficiently and were some of the functions can be outsourced. If you can buy a small business, save one FTE salary, lose the premises and find synergies with websites etc you may be able to carve out some meaningful profit.
There is nothing really to be afraid of, go for it with your eyes open and trust your own judgement.
I own three small businesses, only one really relies on my day today in put. The first I started in 2003 but haven't actually 'worked in' since 2005. A second was acquired by the first last year. And the third was a small MBO in a completely different sector. We are currently looking to try and do another acquisition to add to the first two companies I mentioned, a bolt on.
My experience with business transfer agents is that they are a mixed bag. The big guys have thousands of companies on their books and do very little for them. I once inquired about one business that was on the website of one of the larger agents only to be told that the last entry on their files was four years ago! The smaller guys, who only have a handful of normally higher value companies on their books do a much more thorough job.
My first real attempt to buy a business failed despite agreeing a price due to my own timidity and the lack of effort on the agent's part. Basically the vendor ended up practically giving his business away because he thought I had lost interest when in fact both parties were waiting for the agent to contact us.
More recently we completed a transaction through RTA and to be fair to them they did a good job once they knew they had a good chance of a deal coming off. The vendors have also been good as gold and really made sure it has worked for us.
As for the reasons for sale, smaller businesses will often be retirement sales but in some cases people just can;t see any further prospect of growth without investment that they are not willing to make. In one case I visited a business were they guy had been running it fairly profitably for ten years but could never take more than a day or two off work. He had just had enough. I look for two man businesses which are run inefficiently and were some of the functions can be outsourced. If you can buy a small business, save one FTE salary, lose the premises and find synergies with websites etc you may be able to carve out some meaningful profit.
There is nothing really to be afraid of, go for it with your eyes open and trust your own judgement.
These are some of the websites I look at regularly. They are not all agents, some are just portals for all agents to use.
www.daltonsbusiness.com
http://www.knightsbridgeplc.com/
http://www.rtabusinessesforsale.com/
http://uk.businessesforsale.com/
http://www.turnerbutler.co.uk/
www.daltonsbusiness.com
http://www.knightsbridgeplc.com/
http://www.rtabusinessesforsale.com/
http://uk.businessesforsale.com/
http://www.turnerbutler.co.uk/
Ossiantoad : Thanks for the information think those couple of paragraphs are more insightful that most things I have read over the last couple of months, thank you. I'm incredibly fortunate with my current business , started out as way to make a hobby excess able as a teenager and has grown to something that I never thought possible.
AyBee said:
Out of interest, any specific reasons why you want to get into a different field rather than putting effort into expanding what you already have or start something similar to what you already have?
Little bit difficult with out giving away what I do but a couple of reasons,My global target market is incredibly niche and very small, there isn't much more growth available in the sector.
The market has a finite life span I don't want to be sat on the tail end of that life span thinking , bugger what now.
Its a market ,company and role that I have worked in since I left school, I know it , the skills it needs and the people in it incredibly well it would be nice to have a fresh challenge with new skills in a new market.
Interesting thread Dom,
I'm in a similar position to you - run a business that requires only minimal input and will get less and less as I hire staff to take over more aspects of the business.
I browse the online listings with interest wondering if a second business would be viable for a new challenge - preferably something that could be managed by a pre existing team.
Areas I've looked into include self storage, car washes, subway stores, other food / drink - basically anything that is simple enough to be run by a manager and small team with a few hours per week input.
I would love to chat with anyone who has done this - PM me
Has anyone tried business networking as a means of meeting folk who have done this?
I'm in a similar position to you - run a business that requires only minimal input and will get less and less as I hire staff to take over more aspects of the business.
I browse the online listings with interest wondering if a second business would be viable for a new challenge - preferably something that could be managed by a pre existing team.
Areas I've looked into include self storage, car washes, subway stores, other food / drink - basically anything that is simple enough to be run by a manager and small team with a few hours per week input.
I would love to chat with anyone who has done this - PM me
Has anyone tried business networking as a means of meeting folk who have done this?
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