Where to Buy a Business: Everything You Need to Know

Q: How much money do you need to buy a small business?

Prices for purchasing a small business for sale can vary widely depending on the industry, location, and brand. Listings on popular business buying websites can range from about $1,000 to $1 million. Businesses with lots of expensive equipment and a physical location, like restaurants and gas stations, are often on the high end. Online businesses that can be run from home fall on the lower end. Service businesses often fall somewhere in the middle.

Q: What are the steps to buy an existing business?

If you’re ready to purchase an existing business, here are the steps you need to follow: Find the right business. As explained above, finding the right business to buy may be the most challenging part of this process. You first need to identify a business for sale that meets your criteria. Negotiate the price. You can then contact the seller or work through a business broker to negotiate a price. Though the business owner doubtless has an amount he or she would like to get for the business, you need to consider other factors like your budget and any challenges the business may face and give a counter offer. Sign a letter of intent. The next step would likely be your expression in written form about your intention to buy the business at an agreed upon price. But don’t get too excited. You’ve still got a few steps before the sale goes through. Do research and due diligence. You need to do some research to figure out if the business for sale is a good investment or too good to be true. Look at cash flow, reputation, location and other factors. You should also look at an assessment of the business’s assets and liability. Secure financing. If you don’t have the cash on hand to buy the business out right — and not many small business owners or potential small business owners do — you may need to secure financing from a bank or other financial institution. Some small business owners may offer owner financing and that’s something you will need to look into while researching the deal. Close the deal. Once the price has been negotiated, the due diligence and research done and the finance secured, it’s finally time to close the deal and buy your business. Here again you may want to hire a business broker or sales agent to help out.

Published: Jul 20, 2023 by Annie Pilon In Startup Advice 0

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Not all entrepreneurs need to start a business from scratch. Buying a business can give you a head start on things like brand recognition and operations. So where can you find a business for sale if you’re interested in going this route?

From California to North Carolina, there are plenty of places for potential business buyers to find a business for sale in the United States. Your choice depends on factors like price, business category, and location. So understand all the options before browsing for small businesses for sale.

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Best Ways to Find a Small Business for Sale

From websites to personal contacts and beyond, there are many places an entrepreneur can find a business to buy. Here are a few of the best places to look for a business to buy both online and off.

Business Brokers

business brokers, where to buy a business

A business broker is an intermediary who helps buyers and sellers facilitate the sale of a business. Some business brokers work with businesses in a specific area or industry. So find one experienced in the category of business you’re interested in purchasing. Contact the business broker of your choice directly to find out if they’re working with any sellers with businesses relevant to your chosen categories. If you’re looking for a broker to help you find a business to buy, try the Find a Business Broker feature on BizBuySell.

Other Small Business Owners

small business owners, where to buy a business

Small Business Deals

Business owners you know may refer you to someone in their circle looking to sell a business. Some may even be interested in selling their own businesses. A quick message to a contact on LinkedIn or a conversation with a business owner at a networking event may open up new opportunities you didn’t even know existed. To connect with more business contacts in your area, consider joining a local chamber of commerce or finding online groups for businesses.

Your Larger Network

where to buy a business, network of connections

Your larger network of connections may also be a source of information on potential businesses for sale. This network may include business associates, co-workers, and even social media connections. Discuss your goals with these individuals or post about the type of business you’re looking for. Some may have suggestions or contacts that could be helpful.

Ads in Local Media or On Websites

Your local newspaper, online publications, and even message boards can be perfect places to find hyper local business listings. Business owners looking to sell may place classified ads looking for a qualified buyer or broker. So browse these listings or search relevant local sites by keyword. You might even place your own ads to see if any local business owners are interested in selling but just haven’t taken the first step yet.

Method	Description	Where to Start
Business Brokers	Intermediaries who connect buyers and sellers; some specialize in specific industries.	Find a Business Broker feature on BizBuySell.
Other Small Business Owners	Potential referrals to sellers; some might even be selling their own businesses.	Networking events, LinkedIn, local chamber of commerce, online groups.
Your Larger Network	Includes business associates, co-workers, social media connections.	Discuss goals with network, post on social media about your interest.
Ads in Local Media or On Websites	Classified ads by business owners or brokers looking for buyers.	Local newspapers, online publications, message boards, place your own ads.

Online Business For Sale Listings

Another place online to find businesses for sale is on a variety of sites specifically designed for this purpose. Here are some sites you may wish to visit while starting your entrepreneurial journey.

1. BizBuySell

BizBuySell is the largest online marketplace for businesses for sale. You can find franchise opportunities, independent businesses, and brokers. And there are a huge number of options for all price ranges and industries.

The marketplace has a Business for Sale feature to help you search for businesses to buy in your area. You can also download a free ebook called the BizBuySell Guide to Buying a Small Business. If you’re a seller, you can also the BizBuySell Guide to Selling Your Small Business.

2. BusinessesForSale.com

BusinessesForSale.com offers a marketplace of more than 58,000 businesses for sale. You can search by state, city, and keyword to find the most relevant opportunities.

Popular categories on BusinessesForSale.com range from gas stations to coffee shops to pet grooming services, all with different price ranges and revenue potentials. And there are even international opportunities available around the world.

3. BusinessMart.com

BusinessMart.com offers a place for buyers and sellers to connect. You can search businesses and franchise opportunities by industry, location, and amount you’re willing to invest.

The site also offers resources like a vendor search function and links to relevant brokers and funding options. So you can use the website as a hub for information as well as a place to find businesses for sale.

4. BizQuest.com

BizQuest.com provides access to franchises and businesses for sale, along with information on local brokers. You can search businesses for sale by keyword or even browse by city, state, industry, or brand. The site also offers specific options for buying franchises, assets, startups, and real estate.

Once you conduct a search to find a business for sale, you can review the list of results and even save the ones you are most interested in. Read the brief description and then click through for more details. BizQuest provides a simple form that then allows you to contact the seller directly.

5.BusinessBroker.net

Though the name can be misleading, BusinessBroker.net allows you to search for much more than a business broker. You can search the website for a business for sale by customizing the type of business you are interested in as well as your minimum and maximum budget. You also get to choose the location by state.

After completing your search, you can browse the results. Listings include asking price, cash flow and revenue numbers. You can read a brief description of each business before deciding whether or not to add it to your request info basket for more information.

6. Loopnet

Loopnet stands out because it does not just provide the opportunity to buy a business but also the chance to buy or lease commercial property. Enter the type of property you are seeking. Categories include office, industrial, retail, restaurant, specialty, healthcare and more. There are also listings for multifamily units for sale so this offers a chance for those who are in the apartment rental business too.

Once you’ve chosen the property type and location, you receive listings including a photo, square footage and pricing. There are even maps of the location of each property and demographics information about potential area customers including household income, absolute population and local consumer spending.

7. Exchange

Exchange is a website specializing in helping buyers find an online business for sale. Exchange allows you to search existing business websites. Business listings include online businesses in gifts and collectibles, fashion and apparel, services and consulting, home and furniture, health and beauty and many other categories.

Browse the business websites by category and then view the website listings you find most interesting. Listings include the URL, the asking price, average revenue, average profit and average sessions per month.

How much money do you need to buy a small business?

From industry type to location and brand value, the cost of a small business varies.

Industry Variation: The cost of a business can differ greatly based on its industry.
Price Range: Listings on business buying websites generally fall between $1,000 to $1 million.
High-End Businesses: Those with substantial equipment and a physical presence:
- Examples: Restaurants and gas stations.
- Reason for high cost: They come with tangible assets like property, machinery, and inventory.
Low-End Businesses: Primarily online ventures without hefty physical assets:
- Examples: Dropshipping stores, affiliate marketing.
- Advantage: Lower overhead and can often be managed from home.
Mid-Range Businesses: Service-oriented enterprises with varying degrees of assets and expenses:
- Examples: Consulting firms, local service providers.
- Cost Factors: May involve a mix of tangible assets and client relationships, driving their value.
Location Factor: The geographical location of a business can also influence its price, with businesses in prime areas often demanding higher prices.
Brand Value: Established brands with a loyal customer base can command higher prices than newer or less-known entities.

What are the steps to buy an existing business?

If you’re contemplating taking the entrepreneurial leap by acquiring an already established business, it’s essential to follow the right process to ensure you make a good investment. Here’s a step-by-step guide to help you successfully purchase an existing business:

Find the right business. This initial step is pivotal. Start by understanding your own strengths, interests, and market knowledge. Next, search for businesses that align with these factors. Online business-for-sale platforms, networking events, or industry-specific brokers are good places to look. Make sure the business matches your predefined criteria before proceeding.
Negotiate the price. Once you’ve identified a promising business, initiate discussions about the price. Remember, while the seller has a set price in mind, it’s your job as a buyer to evaluate the business’s value comprehensively. Take into account its financial health, growth potential, market positioning, and any foreseeable challenges. If the asking price doesn’t match your valuation, be prepared to negotiate or even walk away.
Sign a letter of intent (LOI). This document outlines the preliminary terms agreed upon by both parties. An LOI demonstrates serious interest but isn’t legally binding, allowing room for further negotiations or due diligence.
Conduct thorough research and due diligence. Before sealing the deal, embark on an exhaustive investigation. Examine the business’s financial statements, scrutinize its cash flows, and delve into its client contracts, employee agreements, and any pending or potential litigation. Evaluate the business’s reputation through online reviews, customer feedback, and industry peers. A comprehensive understanding now can save you from unpleasant surprises down the line.
Secure financing. Purchasing a business often requires more capital than what’s readily available. If you can’t pay outright, explore your financing options. Traditional bank loans, Small Business Administration (SBA) loans, or even private investors can provide the necessary funds. Additionally, some sellers might offer financing terms, which can be beneficial but requires careful scrutiny.
Close the deal. Once you’re satisfied with your due diligence and have secured financing, you’re in the home stretch. At this stage, legal documents are drawn up, and assets are transferred. It’s wise to work with professionals, like business brokers or legal counsel, to ensure all details are meticulously handled.

closing a deal, where to buy a business

For a deeper dive into the specifics of buying a business for sale, read How to Buy a Business.

Image: Depositphotos

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