Issues to Consider When Buying a Business

When contemplating purchasing a business, you have some major issues to sort through. Where do you start?

When contemplating purchasing a business, you have some major issues to sort through, including:

• Type of Deal. What kind of deal will it be - purchasing the assets of the business or purchasing the stock?
  
  
• Confidentiality. If the seller will be sharing confidential information, such as financial statements and customer lists, the buyer probably will be asked to sign a Confidentiality Agreement.
  
  
• Letters of Intent. Consider whether signing a letter of intent makes sense before you invest a great deal of time and money.
  
  
• Due Diligence. Make sure you have thoroughly checked out the business you are buying-its financial performance, assets, liabilities, contracts, employees and more. Click here to view a sample due diligence checklist.
  
  
• Definitive Agreement. You will need a comprehensive definitive agreement setting forth the terms of the acquisition.
  

For a detailed review of the issues to consider when buying a business, click here to view a Checklist for Acquisition of a Private Company.

Find more great tips and advice on buying, starting or selling businesses at AllBusiness.com.

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