Being an entrepreneur is often associated with starting a new business from scratch, but really, it doesn’t have to mean that. It’s actual dictionary meaning is:
“A person who sets up a business or businesses, taking on financial risks in the hope of profit”
Buying an established business can actually be a much smarter move than starting a business up from scratch, for lots of reasons. Below, we’re going to show you ten reasons you should be placing your entrepreneur skills in this option:
Fewer People Are Starting Up Businesses These Days, And For Good Reason
The number of startups launched in the UK last year (2017) dropped by over 10% according to the latest statistics. This was the first time the amount of business startups has dropped for seven years. Although the reasons behind these drops aren’t clear, it is likely something to do with the fact that so many startups fail, and perhaps entrepreneurs are catching on to the fact that this isn’t necessarily the best way to win in business.
You Can Get Financed Much Easier
Every business needs financing, particularly during periods of growth. Lenders are strict on lending money to startups, but they are much less strict with established businesses that have a proven track record of making money. It makes clear business sense for them, because there’s less risk involved.
You’ll Have An Income Right From The Start
Startups naturally go through a period where money is not expected to be made. This is natural and normal, but an intensely stressful period of risk for entrepreneurs. This situation can go on and on and leave startups without any income for years. According to statistics, 77% of startups actually rely on savings for initial startup funds, and 82 percent go on to fail because of cash flow problems. When you take on a business that already has an income, you have cash flow from the very beginning and avoid that period of money-drought that can so easily kill a startup off.
Brand Awareness Is In Place
Building a brand is a very difficult and time-consuming thing to do, so why not skip that process and invest in a brand that is already established? By buying a brand, you get the copyright, the social awareness, the trademarks and social media accounts associated with it already. You’ve already got something that can take new businesses years to build.
You Will Have An Instant Customer Base
If your existing business has a brand, and an income, then it already has an instant customer base. Of course, it may take some work to get new customers and retain the current ones, but you have an amazing springboard to work from because you’ve already got customers in place.
You Will Have Instant Employees
Straight away you will have a team of employees who are already trained and ready to help you grow the business. Startups want to hire, and according to reports, small businesses account for two-thirds of the UK’s new jobs every single year, but often the funding isn’t there to allow for that growth. When you buy an established business, the staff are already in place and being paid by the money the business is already making.
You Can Find A Business You Care About
Buying an established business doesn’t have to mean you buy a business that you don’t feel a connection to. On Business Trade Centre you can find a wide range of business types for sale, with new ones being listed all the time. You don’t have to start a business to match your passion for a certain cause or area of industry; the chances are there will already be a business for sale out there you can relate to your motives and morals and mould to suit your goals.
You Can Put The Effort Into Growing The Business Straight Away
With a startup you have to put a lot of time and effort into establishing the business. Getting customers, funding, creating branding and making a place in the world for your business. When you buy an established business, you can get stuck straight into growing the business.
You Already Have Contacts
A big part of creating a successful business is making contacts. Suppliers, marketing experts, customers, IT freelancers and other contacts are important and very useful to already have in place. It will also be a lot easier making new contacts with an established business behind you.
There Will Be An Income To Reinvest
Startup funding goes straight into keeping the business afloat. Money from an established business can be actively invested to help the business grow. So ideas you have for the business to move forward can be made into plans straight away.
Buying An Established Business Is Convenient & Cost-Effective
There may be a strong reason you would rather start a business from scratch. Perhaps you have a passion project, or a desire to create the business foundations yourself. There’s every reason you will be successful and should follow your heart. However, it is worth considering purchasing a business and integrating your desires for business in that way. In doing this, you’re effectively joining the entrepreneur race halfway along the track, when the pace has already been established, and everything is already well underway. It could be the head start you need to build the career of your dreams via a much easier path to success.