A business for sale is a professional and economic opportunity for individuals wishing to start their own business, as it enables them to acquire the tangible and intangible elements of a company. Whether you’re looking to expand your business or retrain, the search for and acquisition of an “fond de commerce” is a great way to have a showcase that already boasts a clientele, a distribution network and equipped premises.
Before you can buy, it’s important to start by targeting a business sector and a region.
There are many online advertisements, but you still need to be able to distinguish between the different types of business, make a reliable economic projection, negotiate the terms of the business sale and obtain the appropriate financing.
How do I find a business?
To find a business for sale, the future buyer can consult the advertisements on sites specializing in small and medium-sized businesses.
These are regularly updated, and it is advisable to act quickly, as the best locations and their accessibility are often preferred.
Identifying establishments with good economic potential should be a priority for the future buyer.
That’s why he or she should pay close attention to the first elements of the ad, including geographical position, location in the city, surface area, number of employees and any other visible tangible elements such as tools, machinery and quality of infrastructure.
You can also turn to a specialist in buying and selling businesses, or contact the franchise directly.
Based on the buyer’s requirements and criteria, the real estate specialist will be able to target the properties available on the market.
It’s essential to define your sector of activity in order to consider setting up a related business.
For example, a delicatessen can be transformed into a pastry shop or café, while a beauty salon can become a spa or tanning salon, depending on the equipment.
What to check before buying a business
Before buying a business, the buyer must ensure that all tangible and intangible assets are recovered.
This includes furniture, equipment, fixtures and fittings, vehicles if any, and tools.
Inventories of goods and raw materials are also included.
Intangible assets include the business name, licenses, patents, authorizations and trademarks, employment and insurance contracts, as well as the customer base, which is the main asset of a business acquisition.
A visit to the premises also enables you to ascertain their condition in relation to the advertisements.
Attesting how busy the premises are is also a key factor in determining the value of a business for sale.
It will then be easier to make a realistic estimate, taking into account the DPE (Diagnostic de performance énergétique).
Valuation, negotiation and acquisition
The seller has the right to optimize his business for sale in order to increase its value.
The aim is to demonstrate that the chosen activity is sustainable and that the facilities put in place are durable.
To attract buyers, it’s important to prove that the business will ensure continuity over the next two or three years, with or without structural improvements.
Acquirers also find value in the presence of processes, methods and techniques.
The buyer will need to take these into account in his economic analysis and projection, in order to estimate the fairness of the sale price of the business.
However, the key to estimating the value of a business for sale is to study sales and profits over the three months preceding the transfer.
Sales for the current financial year, as well as the customer portfolio, order book and current receivables, all help to guide the estimate.
Reputation, competition, opportunities and changes in the business environment are indicators not to be overlooked.
What is the procedure for buying a business?
To finalize the sale of a business, both seller and buyer must comply with certain rules.
Beforehand, the seller must provide the name of the previous vendor, the date of the lease with the name and address of the lessor, and a summary of sales figures between the close of the last financial year and the month preceding the sale.
A declaration is filed with the town hall, and employees are informed of the sale of the business, as they can buy it back.
The buyer then registers the deed of sale with the tax authorities.
He also pays registration fees of between 3% and 5% of the sale price, depending on the amount requested for the business for sale.
A notice is then sent to the legal gazette 15 days after signature of the deed.
The business takeover is reported to the Centre des formalités des entreprises (CFE).
