This may sound crazy, but right now could be the perfect time to buy a business. And, both the buyer and seller will probably come out winners.
Many small businesses are suffering terribly right now, barely hanging on. Some are facing the thought of just shutting down. But suppose someone came along with cash to invest, someone who has the financial reserves to wait out the recession and be in a position to revitalize the business.
Struggling business owners may be more likely to want to sell during COVID-19, so they can cash out and hand the reins to a new owner with the drive and resources to carry it on. This could be a way for a small business owner to recover some of the sweat equity and investment they put in, rather than simply closing the doors and suffering a sad ending.
The selling price of a business is determined by a formula that includes the sales figures for the last several years. With revenues down, the selling price of a business could be very favorable after such a drastic slowdown in the last nine months.
With job security a real concern for many, buying a business could give you greater stability for the future, depending on the industry and your skill set. Considering all these factors, now may be the perfect time to contemplate buying an existing business, especially with interest rates at an all-time low
Nearly every industry has experienced significant changes and shifts during the COVID-19 pandemic. With the economic decline, it may seem like right now is a risky time to begin your entrepreneurial journey. However, buying an existing business rather than starting your own from scratch can help mitigate some of those risks.
Steve Niehaus, MBA, CBI