Anyone taken over a business they were an employee for?

[Jane]

I'm looking for advice in this as i have the opportunity to do this, i know how the business works and is profitable but i'm not sure who to talk to and how it work, wondered if anyone had experience of this?

 

[lookingforadvice]

While I have never done this, something I have always dreamed of doing. If you know the business from the inside out then I think all you need is a financial person by your side? It is unlikely that you will be able to focus on growing the business as well as looking after the finances, accounts, wages, cashflow, etc. I would get somebody else in to help you with this side. How large is the potential acquisition? Where would you be getting the finance from?

 

[Jane]

I have the bank willing to loan the company £50k which is what the current accountant has suggested (also the profit made)

 

[lookingforadvice]

So you are potentially buying the business on a rating of just one year's profits? Has the business deteriorated in light of the coronavirus pandemic and the lockdown? Is there maybe potential to negotiate a lower price?

 

[Jane]

I have full access to all the figures and we have arranged the price based on last years profit ( less than the year before but more than the previous one ). We are booming right now and I know there are ups and downs in all businesses.
I guess I was just looking for advice on how it works as it’s been “given to me” rather than sold to me

 

[wayne]

I brought an online e-commerce business a few years back that was on the decline but turned it around and sold for a tidy little profit. Buying an existing business can sometimes be better than a startup. It can also be easier to borrow the money when an existing company has history. These guys helped me out moneywow.co.uk they specialise in startups and buying existing businesses. Having said that startup funding is quite tricky with the present climate if you have nothing to secure the loan to.