When you decide that it’s time to run your own business, you have two options. The one most people think of first is simply starting your own business. You can build it from the ground up, crafting it into whatever you would like it to be. This can be an exciting — if daunting — task.
The problem with starting your own company is that it takes a lot of investment — in both time and money — to make it profitable. Many businesses lose money for years before they start making it. Some never become profitable. It’s something of a gamble, and it may not pay off in your favor.
That takes us to the second option: buying an existing business. Rather than investing your money in a new company, you can take that money and buy one from a business owner who is looking to sell.
Why would you do this? A few reasons include:
- You will already have customers. People know the business, they like the products and they will likely buy from you immediately. You still need to convert new customers to grow, but you do not need to convert everyone.
- You can start earning far sooner. The previous owner already put in those years at a loss. You may earn money your very first day in business. This is a much more stable route, as long as you buy a stable, successful company.
- The brand already exists. One of the biggest things for a new company is getting people to connect with the brand, both online and in person. With an established business, your logo is familiar. You have some name recognition. You’re not starting from scratch.
- You have a proven method. The company works. Maybe you can improve it, but you know that you can at least keep it at the level it was at before. You know that works. Instead of trying to figure out if your idea is worth it at all, you’re trying to figure out how to grow.
Overall, these reasons mean that the business is less likely to fail. It still can, but your odds are much better. If many companies fail in the first five years, your business may already have lived through that crucial point. You invest more up front to get it, but you get a company that will have success.
What steps to take
It is important to know exactly what steps to take if you want to buy a company or start one of your own. Make sure you know how to proceed in Colorado to maximize your chances of success.