Essay Sample on Buying the Business

Individual Buyer

For this type of business buyer, the person comes from a reasonable job. An individual buyer aims to replace their compensation. They can also be aiming at getting a portion of the purchase that is priced by the seller. In other cases, the individual buyer is focused on the amount of money the bank financing can bring to the deal. In a case where the agreement is not bankable, the single buyer will be reluctant. An example of an individual buyer is a clothes shop.

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The buying concerns for an individual buyer are to help the individuals in establishing a business. The most likely thing that takes place is that the owner of such a type of the company will be focused to marketing the brand name of the product and not the products or the services being provided to the customer.

Strategic Buyer

For the case of the strategic buyer, have the perspective of evaluating the operation of the business that is being sold. The primary purpose is to buy a portion of the business and integrate it into their business. They are always aimed at eliminating the competition that could exist (Blackburn, Carey, & Tanewski, 2018). On the other hand, they will always want to, make more profit than the competitor. The reason that is behind paying more is that they have a different objective. Amazon is an excellent example of a strategic buyer.

The concerns for this type of business will be coming up with the strategies on how to reconfigure the image of the of the business to reduce the competition. In this way, business marketing has to be two-fold. That is the operations and the product or service provider to the customers of the business. Things change this much as the strategic buyer has a new objective.

The Financial Buyer

The financial buyer has an objective of returning the investment that can be realized from the business of the seller. They will pay less for more risk of the business, and the opposite is true. They are no hard-and-fast rules. The Blackstone Group is an example of a financial buyer.

The high probability of this type of is that the business will remain the same. The primary target is to avoid risks as well as ensuring that the business is in such a way much of benefits is with them as per the state.

Reasons for Buying the Business and Not Starting One

By buying a business, it is much easier to secure financing. It is a fact that money lenders will be much willing to lend money to established businesses than startups. On the other hand, there is a benefit of enjoying from the already established brand name (Kim & Kumar, 2018). The other benefit is that the business already has its customers, hence there is already a platform to build a stronger customers base. By starting a new business, more challenges include no established network of contacts.

The risks that characterize buying of businesses include poor business reputation, unpaid sales tax as well as low owner's discretionary income. Some sellers will not be in the position of disclosing the reality of their business. They do so to sell the business at a higher price (Ruback & Yudkoff, 2017). On the other hand, the rewards of buying a business include immediate cash flow, the market is already established, and the employees, as well as the managers, are experienced.

If it is a small business, it is worthwhile to carry out a feasibility study to determine whether to grow it as a corporate or not. There are kinds of business that require to be grown in that direction or not. I have considered buying the business if I get a deal that has good prospects. The reason behind this is that buying of business is the short cut that can do business to flourish with no time. Starting a business require intensified research as well as limitations.

References

Blackburn, R., Carey, P., & Tanewski, G. (2018). Business advises by accountants to SMEs: relationships and trust. Qualitative Research in Accounting & Management.

Kim, K. H., & Kumar, V. (2018). The Relative Influence of Economic and Relational Direct Marketing Communications on Buying Behavior in Business-to-Business Markets. Journal of Marketing Research, 55(1), 48-68.

Ruback, R. S., & Yudkoff, R. (2017). Buying your way into entrepreneurship. Harvard Business Review, 95(1), 149-153.