For an entrepreneur, becoming the owner of an existing business is an interesting alternative to setting up a company from scratch. However, this option presents significant risks and obstacles.
Buying an existing company presents advantages when you become self-employed. It allows you to build on something concrete, sparing you some of the difficulties inherent in any new venture. You can also benefit from the experience of the predecessor and better calculate risks. The customer base is there and the company already enjoys an established reputation in the sector. The services and products offered are already known to customers and the employees form a well-established team. Ideally, the new owner can rely on an efficient internal organization. From the very first day, the company is generating income and the successor can pay themselves a regular salary straightaway. Even the business plan can be drawn up according to existing figures, which reduces the risk of errors in planning.
Advantages of taking over a company:
- The company is already established on the market.
- Relations with customers and suppliers have already been established.
- The services and products offered are usually already well-known and have been introduced onto the market.
- The company’s positioning is defined.
- The employees form a well-established team.
- Ideally, there is an efficient internal organization.
- The company is generating income and profits from the very first day.
- The successor can pay themselves a regular salary straightaway.
- There is a reimbursement expense in order to honor existing financial obligations.
However, taking over a company also presents numerous risks which should not be underestimated. A succession settled in haste, without assistance from experts, can also bring disappointment, both for the buyer and the transferor. See below a page containing an open list of the main advantages and disadvantages associated with taking over a company.