Succession or new establishment? 10 reasons for a takeover
If you dream to have your own business, do you have to start your own? Not necessarily. There are also other possibilities, for example, the acquisition of an existing company. But even this practice is widely used, there is relatively little information about it. In this article, we offer you 10 reasons for taking over a business exclusively.
Reason 1: The business idea has proven itself in practice
Hardly anything is as uncertain as a business idea which is not yet thoroughly tested. No matter how convinced a founder is of his approach, what is good for him is to put it into practice.
If you succeed a company that has been in the market for years, maybe even decades, you can be sure that the business idea really works. Otherwise, the company would have gone bankrupt.
Reason 2: You can directly step into the process
Anyone who has ever started a business (or is currently at it) knows: It's hard to get started! Especially in the early phase of self-employment, so many things have to be done "on the side", thus it is difficult to concentrate on the actual business.
In the case of a takeover, it is very different. As a successor, you can directly enter the business and continue the running processes.
Reason 3: You have experienced partners by your side
Entrepreneurs who sell their company often sell not just a business idea and manufacturing facilities, but also a large, high-quality network of business partners and suppliers. Do not waste your time making new contacts, just maintain the ones your predecessor left you.
You will soon realize that these experienced partners are a great advantage.
Reason 4: There are already customers
This fact will be particularly pleasing to many aspiring entrepreneurs, because it is well known how difficult it can be to convince a potential customer of a product or service.
One of the greatest benefits of company succession is that you automatically take over a customer base without any acquisition or expensive marketing measures.
Reason 5: Create valuable synergies
When young motivation meets old experience, in most cases it will generate something really exciting.
A company takeover rarely takes place right away; it is rather a product of a gradual rapprochement. Especially when the former and the new managing director work hand in hand for a while and enrich each other, the succession can create interesting synergies that considerably advance the company.
Reason 6: You already have suitable staff. Search for employees? Hire a head-hunter? Go through tons of CVs?
As a successor, recruitment is usually spared. After all, you usually take on the entire workforce with the company.
The staff do not only grow over time, they also know exactly what to do. This not only saves you a lot of time, but ultimately also lots of money.
Reason 7: The risk of failure is lower
If you are interested in taking over a business, you probably will not buy a company that has been "dying" for years. Acquiring a solid business always means you have a low risk of failing, which is invaluable in some industries.
Reason 8: You have better chances of getting loans
Many banks and other donors struggle to lend to inexperienced start-up founders. However, if the request comes from an established company with good balance sheets and financial statements, the situation will be very different.
As a successor you usually enjoy a high reputation with banks automatically. Not a bad starting point if, for example, you intend to take the company to the next level and let it grow.
Reason 9: The complex start-up process is partially dropped
Especially when you intend to establish a corporation, for example, a limited liability company, an entrepreneurial society or a stock corporation. You have to prepare for a complex start-up process that not only consumes time and money, but also brings lots of stress.
The situation is quite different with the takeover. In this case, only the follow-up formalities need to be clarified. It saves you from all the complexity of establishing a new company.
Reason 10: You earn money from day one
While founders who start from scratch often do not earn a penny for months, as a successor you can start earning money from the first day. Again, it is clear how advantageous it is to take over a running operation.
Company takeover? Worth considering
Of course, the topic of company takeover is incredibly complex and was touched on this page only superficially. And of course, it must also be emphasized at this point that there are certainly disadvantages in this context.