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> Questions to ask when buying a business?

ED_K.
post Mar 15 2019, 07:47 AM, updated 2w ago

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Hi all,

I'm currently planning to buy a business (food stall in a food court). This is my first time venturing into self-employment and I need some input from all the sifus here notworthy.gif

What questions should I ask the current owner before taking over his business? I've asked about expenses such as wages, supplier, rent and utilities. What else should I be asking? confused.gif


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MUM
post Mar 15 2019, 08:10 AM

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You've asked about expenses such as wages, supplier, rent and utilities.
What else should I be asking?
hmm.gif maybe, just maybe....
can you cook those foods that you intent to sell?
what are the back up plans (if any) in case your workers absent for a few days?
is the food that you gonna sell suitable for the majority of the traffic's populations to that food court?
Does that foodcourt relies on certain peak hours of the day only?



tupaiterbang
post Mar 15 2019, 08:18 AM

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observation on site is more beneficial i think so from there you can deduce this business has potential or not, the customer crowd, your competitions there, and in the end hopefully come up with strategy to sustain the business if not thrive...
cherroy
post Mar 15 2019, 09:50 AM

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If ask from current owner, surely the owner will paint the best picture, high revenue, low expenses. biggrin.gif
Instead one should ask, why the seller wants to sell in the first place, or find the real cause of it
As if a stall/business is highly profitable, generally people won't sell it.

Best is to observe ownself to determine business flow and potential expenses or asking adjacent stall/business owner about situation there.
lowya
post Mar 15 2019, 10:36 AM

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sit down whole day and interview the customers there, you will get the whole idea.
NightHeart
post Mar 15 2019, 11:25 AM

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You gotta check if the current owner or biz has any outstanding debts or not.

The last surprise you ever want is for debtors (worse if it's illegal debtors) to chase you when you just takeover a biz.
Dachshund
post Mar 15 2019, 11:31 AM

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QUOTE(NightHeart @ Mar 15 2019, 11:25 AM)
You gotta check if the current owner or biz has any outstanding debts or not.

The last surprise you ever want is for debtors (worse if it's illegal debtors) to chase you when you just takeover a biz.
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How to check?
NightHeart
post Mar 15 2019, 11:43 AM

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QUOTE(Dachshund @ Mar 15 2019, 11:31 AM)
How to check?
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TS was asking for questions to the biz seller, so that's one of the critical question I'm suggesting laugh.gif
But of course, there's no way to fully find out if the seller is lying or keeping secret. So the best you could probably do is to get the contact list of their suppliers (including service providers) & then get in touch with all of them.
ChessRook
post Mar 15 2019, 02:12 PM

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I am not sure if CTOS or CCRIS scores are of any help. You need to buy and check the credit scores of the directors.
alexkos
post Mar 15 2019, 05:07 PM

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r u buying a business, as in acquiring 100% equity so that the business runs without your supervision?

or, you are buying a stall and do 'self-employment', aka you put your own hands at work?



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