BizSale Small Business Blog. Small businesses for sale.

Here are some pointers of questions to ask the seller when looking into buying a particular business.

• The first and most crucial question to ask is why is the seller selling? The immediate response (watch the body language) to such a direct question will be quite revealing.
• Has the seller offered to give you a handover period after the sale to help with the transition, and have you discussed payment for their services during the handover?
• Make sure you request to look over the certified financial statements of income, cash flow and balance sheets for the last three years. If you plan to borrow from a bank to purchase the business, the bank will want to see them.
• Ask to see the company’s (and not the owner’s personal) tax returns for the past three years. The bank will need this information as well.
• Request a copy of all documents of all outstanding creditors like accounts payable, property and equipment leases. Again the bank will require this.
• See if you can pick up anything about the quality of customer relations at the business? Is there good rapport between the business and customers?
• Have you gathered anything about the relationship between the business and its suppliers?
• Find out about the conditions of the working environment. Are there any hazardous situations or is this a well-kept workplace? Once you have handed over it will be your responsibility to make sure it is a safe place to work for the employees.
• Lastly, find out about the conditions of existing fixed assets, for example, office equipment, machinery and vehicles. Does the existing staff (if any) demonstrate good maintenance and cleanliness of company property?

Finally for a comprehensive list of over 1000 questions to ask a business seller refer to our page at http://www.business-sale.com/nresourcediligence.html

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The media is full of scare stories about the impending Credit Crunch and the impact that it is likely to have on small business. NFEA (National Federation of Enterprise Agencies) is taking action on this issue with the launch of a dedicated Credit Crunch Week – to prepare current and future small business owners for any consequences this economic climate is likely to have on their business.
Running from Monday 28 April to Friday 2 May, NFEA members across England will provide a range of events focused on giving small businesses the skills they need to survive and thrive in a more hostile environment than that to which they are accustomed.
New and prospective small business owners will be able to learn how to ride the storm and manage their business effectively whatever the future brings, in a range of tailored events including seminars, workshops and surgeries as well as the opportunity for one to one independent, professional financial advice.
Commenting on the launch of this dedicated activity, NFEA Chief Executive George Derbyshire has said: “We are not criticising the Government or the banks or big business – but we know from talking to small businesses that they are worried about what they are reading and hearing, and we know that many entrepreneurs, particularly those who have started businesses in recent years, have not had the experience of managing their business through a downturn.”
More information on the dedicated week of events will appear on www.nfea.com in the lead up to the week of events and details will also be promoted locally by NFEA enterprise agencies. For those individuals not able to attend an event in person, online business advisors will also be answering specific Credit Crunch related queries on the free and confidential Small Business Advice Service website, www.smallbusinessadvice.org.uk.

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According to the Institute of Employment Studies (IES), people who spend their career working with a small company are more likely to feel appreciated than those who work for a larger business.

Working with only a few other staff will probably lead to closer, more mutually supportive relationships.

Working in a smaller company means that the work that any individual does is felt with more immediate effect, than if they are a cog in the machine of a larger organisation.

In my personal experience working for a small company is more interesting, as you get an understanding of all aspects of the business, this would not happen as easily in a large company. Also I have found that the roles are more varied and therefore more challenging.

The Department for Business, Enterprise and Regulatory Reform’s SME Statistics report, which was published in the summer of 2007, noted an increase of 125,000 businesses in the UK for that year. Of these 99.3 per cent were small businesses with 50 employees or less.

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