Can you offer any thoughts on the buying out the competition dilemma?
One of my local competitors offered me to buy them out...
Just wondering if any of you have been in similar situations and what the turnout was. If you haven't been in this situation, what are your thoughts as my fellow business owners?
My competitor and I are both in the Frozen Dessert 'Food Truck' industry, but we both offer different dessert products from one another.
If I do decide to take over their business, should I operate the 2 different businesses separately to kind of leverage each other's different products/services, or should I consolidate the 2 businesses making them 1 single company?
Thanks for any thoughts, gotcha's that can come out, suggestions & advice!
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Answers (1-10)
I would definitely recommend a forensic audit unless you know exactly why they want to sell. A forensic audit would also help to determine what the business is worth and if you are in a position to buy it.
If you have the production capability I would consolidate. The valuation of their business should be focused more on the brand value and market share it would open you up to.
I like Joe’s answer, but really not familiar with either of your brands and not enough information to recommend either way. Depending on the situation, I have multiple opinions. I’ll keep an eye.
Good Luck!
Make sure you talk to your Accountant first. Ask them for their last three tax returns and give them to your Accountant. Your accountant would give you a true value in what you should pay for it. If they say, don't buy it, then don't buy it.
If you do buy it, you will need to run it the way they ran it. They will give you the recipes so you don't change what their customers are used to. You don't want to buy a business and then change things. You will not only lose your investment, you will lose their clients.
Your Accountant will let you know if you need a separation of businesses for your taxes.
I hope this helps. I purchased a business before.
Sincerely,
Sharon L. Taylor
SharonsSweetBeginnings.com
I have never been presented with such an opportunity however, if you were looking to expand and had the ability, it may be worth the consideration.
I would consolidate. Keep it simple.
Is your competition doing that much more business then you? If so then is it cheaper to buy his business or take that money and invest in what you have goin now ?
Maybe you lease another truck and cover more ground in your current business and you just mite flourish and put them out of business
If you got the money it still to me ain’t worth it
Invest in yourself
Mahalos
Hello, MM! I have not been in this position, but if I were I'd ask why they are willing to sell & do I have enough staff for 2 businesses.
I would not run competing businesses. I would certainly convert. Otherwise, you will be carting their reputation along with you as well.
y answer to that question is simple. DON'T, DON'T!!! Why spend the money? Know your competition, products and price. Spend your money on improving your product, if you have to. Product, Price, Service and just beat your competition, don't buy it.