Eight Steps To Buying Your Own Business

How to avoid costly mistakes - take it one step at a time (NC)-Being one's own boss is an enduring Canadian dream and buying an existing company might offer the best way to realize this dream. Making a business acquisition can be an exciting opportunity - if it goes well. Avoid costly mistakes by following these eight essential steps. . Develop and implement an acquisition strategy It is of paramount importance to establish clear criteria to focus your search and to measure potential targets against. This up-front thinking will save a lot of time and frustration later in the process. . Identify suitable targets based on your strategy Searching for a suitable target is a time consuming project. It is also a sensitive part of the process - showing too much interest too early may "up" the cost you have to pay for an acquisition. . Begin discussions with potential targets Potential targets must be carefully assessed based on your acquisition criteria. Emotional decisions based on a "gut feel" have no place in serious business acquisitions. . Arrange for a business valuation of the target Using the skills of a chartered business valuator, conduct a valuation of the target business. . Secure financing Without proper financing, no business acquisition can move forward successfully. . Conduct due diligence Due diligence will help you ensure that you are buying what you think you are buying. . Negotiate, structure and close the deal Make sure the tax consequences of any deal structure are carefully explored. . Plan and implement a post-acquisition strategy Without proper planning of the post-acquisition strategy, what seemed like a good deal can quickly go sour. Visit www.GrantThornton.ca/resources for more information on how to buy or sell a business. Grant Thornton is a leading Canadian firm of chartered accountants and management consultants with offices across Canada.