Do you want to buy a business? Perhaps you are a business owner looking to snap up an additional business or are craving an escape from the rat race. Either way, there are seven sins all potential purchasers must avoid.
In theory, buying another business can be a good way to grow, but it needs careful study.
Expanding a business through acquisition is something most owners consider at some time, and in our experience those that do, are often unaware of the risks involved, and how to set a realistic purchase price.
How a company can grow through acquisition without losing its identity.
Purchasing another business could expand your business overnight. It might enable you to take advantage of new economies of scale, or diversify into new areas. But an acquisition can also bring problems, draining financial and management resources from your original business. This article considers some of the pros and cons in expanding your business through an acquisition.
The obvious place for a company to begin to develop an effective acquisition capability is to examine best practices in the area. These acquisition best practices separate into two categories: pre-deal due-diligence and post-merger integration planning, and the actual post-merger integration process.
What should acquiring entities think about pre-deal? The short answer is, unfortunately, everything. Lists upon lists of "to-dos" abound - from things you need to think about before you do anything... to things that are typically overlooked in transactions. We thought we would add to this collection by offering up a list of our own: a list pertaining to people issues.
With businesses of all sizes facing competitive change in the 2000s, the pressures to find effective routes to growth have intensified significantly. Small, medium and very large corporations are inclined to thrust for growth especially in the search for shareholder value.
If you are considering buying a franchise you should consider all available information before making the decision.
Due diligence and major deals are like bricks and mortar. If a deal is prepared without conducting a thorough analysis of a deal's strategic logic and potential value, cracks in a deal's structure may go unnoticed. The financial implications of this oversight should not be underestimated.
Acquisitions should provide an opportunity for growth and the creation of significant value-added opportunities. However success is dependent on ensuring a smooth transition during the change over.
Don't buy the wrong business or overpay.
How To Lead With Confidence When You Don’t Feel It
Copyright © 2021
International Institute of Directors and Managers
ABN 26 112 140 299.
All rights reserved.