If you want to run a business, there are two major options. You may buy an existing firm or create an entirely new enterprise. Both methods offer several important benefits and drawbacks. You can expect to pay considerably more if you buy a company. On the other hand, it takes greater effort and patience to start a business from scratch.
Creating a new venture gives you more flexibility. You can start a business in your spare time with very little money and equipment. In some industries, this allows you to avoid large investments and loans. A new enterprise lets you develop your own brand, product line and reputation. You may also hire employees who meet your specific needs.
The greatest drawback is that most startups fail or take years to turn a profit. You won’t have any customers until you develop an effective way to market your products. It can be very time consuming to find, hire and train qualified employees. You may also need to try several suppliers before you find an affordable source of quality products or materials.
Choosing a Path
Both options yield success for many entrepreneurs. The best choice may depend on your profession. People often start child care centers in their homes, but opening a new restaurant remains more difficult. Either way, it’s crucial for you to find a realistic business opportunity that suits your personality and expertise.
Purchasing a Business
When you buy an existing company, the former owners have already completed many tasks for you. They bought the equipment, put up signs, purchased advertising and recruited workers. There’s no need to wait for responses to a “help wanted” ad. Likewise, the company already has products and services that attract loyal customers.
Established firms can also come with serious problems. You may find it difficult to revive a business with a poor reputation. Some owners decide to sell their assets when the buildings and equipment need major repairs. A failing company may offer an appealing low-cost business opportunity. However, you’ll need extra money and superb management skills to turn it around.
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