1. Believing everything that is published on the Internet … there is “fake news”, lots of opinions and some good facts to help you evaluate various industries and trends
2. Not considering an Exit Strategy first and foremost … everyone will exit their business at some point (Retire, Sell, Die or Go Bankrupt), you need to plan and hope to do it on your terms.
3. Forgetting that it is a mutual assessment … sellers and lenders both have a big part in choosing to sell and fund a business to a new owner – don’t be pushy or abrasive.
4. Being either too analytical or too intuitive … proper research or due diligence is needed to understand where a business has been and where it can go, but you want to avoid analysis paralysis. Glossing over details and facts by being too enthusiastic can lead to poverty. Be excited but prudent!
5. Not defining or understanding your unique buyer values … knowing what you can do and do well is important, and knowing what you need from others to be successful is even more important. As an example, poor marketing and/or poor quality service are two top reasons for business failures, according to the SBA.
6. Not compiling a team of Advisors in your decision making … some to consider: Accountant, Attorney, Doctor (need to be healthy), Financial Advisor, another Business Owner
7. Going with the least expensive/cheapest business … underperforming businesses can be cheap to buy and impossible to turn around. Find something you can see yourself operating, enjoying and making successful. Don’t be undercapitalized – one of the SBA’s top reasons for business failures.
8. Allowing other’s to “snatch your dream” without the facts … getting into business can be a dream, but it is not for everyone. Use your advisors. Be prepared to deal with opinions that are not based on your goals, your knowledge, your vision or desire.