buying a business

[lostinspain]

If you buy a business that is currently run as a ltd company, are you obligated to continue under that ltd company or is it wound up and the new owner starts another one?

 

[The Byre]

Ah, this week's buy-a-business thread!

There are so many, many threads here on this topic, that I suggest a search - but you are not obliged to do anything, but you are obliged to follow TUPE laws for employees.

 

[lostinspain]

Thanks for the reply.
We all have to start somewhere.
I have been searching the threads but am getting somewhat bamboozled by the amount of information to wade through!

 

[billmccallum1957]

It depends!!!!

Are you buying the assets or the shares in the company?

Are you going to continue trading in the same location?

You need to discuss with the seller.

 

[lostinspain]

Thanks for replying.
I haven't got that far yet.
The business I am looking at (a shop) is currently run as a ltd company. I was unclear as to whether in buying the business I should/would have to take on the existing ltd company, start my own or start as sole trader.

 

[Clinton]

I have been searching the threads but am getting somewhat bamboozled by the amount of information to wade through!

Then stop now.

Take a step back.

And maybe think about buying a business later!

(But if you do want to research the two options available to those buying a limited company, this article I wrote may help)

 

[lostinspain]

Thankyou, although I am not bamboozled by buying a business .... only by this question about ltd companys. I shall certainly read all information offered which might help.

 

[Clinton]

Anybody who raised the question you did is a n00b, an amateur ... a lamb to the slaughter. And business buyers who don't recognise that tend to get badly burned.

I hope you don't lose too much money.

 

[lostinspain]

Why doesn't your last comment sound sincere?
You can't possibly know the answer to every question when you make your first purchase.
Its a shame you can't be a bit more supportive rather than dismissing someone you know nothing about.

 

[The Byre]

You'll have to excuse our @Clinton, but he's suffering from latent goodwill-anaemia, poor chap!

What he is trying to say is that buying a business is filled with every pitfall, bear-trap and gotcha known to man. It just has become the greatest way for the unscrupulous to take huge sums of money away from some poor saps who thought they were buying a viable business.

Trust me, most (if not nearly all) businesses that are advertised for sale are cons, pure and simple!

 

[Clinton]

You can't possibly know the answer to every question when you make your first purchase.

You asked one question, but there are numerous questions you need to know the answers to before you get into buying a business.

Too often I see people jump into buying a business because they think they know what they're doing when, in fact, they don' t know a fraction of what they need to know and don't take a fraction of the precautions they need to take.

It's not about the specific question you asked... but what asking that question gives away about you i.e. the novice status. I'm not dismissing you, I'm pointing out that if you haven't done this before there are a million pitfalls awaiting you and you will probably lose money.

Do I wish it to happen? Of course not. That's why I advised you to stop, take a step back, learn a lot more and leave buying a business for a later date. But you replied with an arrogant:

I am not bamboozled by buying a business

Well, you should be. But if you figure you're ready to go, then ... good luck!

 

[lostinspain]

Clinton, are you bamboozled by buying a business? Be careful - if you answer no then you are arrogant!
For me - I was merely pointing out that I needed clarification on this particular point - not that I knew everything else!
I am the first to admit that I couldn't possibly know everything about buying a business; that's why I posted a question in 'First steps to starting a business' . It stands to reason that posters here are fairly new to business. I have started businesses from scratch, but never bought one.
I'm disappointed to find that asking for help in (what seemed to me) the obvious place has provoked an unhelpful response. I am always ready to learn from those more experienced and knowledgeable than myself, but there's a fine line between helpful and unhelpful criticism.
Fortunately - I don't need you.
Thanks to everyone else for their comments.
That's me over and out!

 

[Markus Brundisteg]

In my opinion when you want to expand your business one of the best things is to buy foreign company. Then many legal and other establishment procedures are already done. Also foreign companies already have local employees who know the market and can help with smooth business development. I think employees are the most important factor.

 

[The Byre]

I'm disappointed to find that asking for help in (what seemed to me) the obvious place has provoked an unhelpful response. I am always ready to learn from those more experienced and knowledgeable than myself, but there's a fine line between helpful and unhelpful criticism.
Fortunately - I don't need you.

You seem to not understand the overall situation today. Most businesses that are for sale are not showing an honest picture of who they are, what their turnover is, or what sort of profits they make. Selling an SME is today the con-artist's favourite method of getting unsuspecting people looking for a fair shake in life, to part with ten or even hundreds of thousands of pounds.

It works like this - if I was to be a con-artist, I would find a mom-n-pop corner shop or some similar sub-one-million TO operation and persuade them that they are sitting on a gold mine. "People are search desperately for businesses like yours. This shop is worth £X00,000 at least!"

Until now, Mon-n-Pop have been working all the hours Zeus gave them and getting a passable living out of all that effort. Maybe £50k gross between them. They are in their 60s and have built no retirement nest-egg. The shop is rented, the goods are on 30-days and the Audi in the driveway is on the never-never. And they are just tired!

As a con-artist, I show them how to find someone like you, how to reel him in. How to cook the books and how to dress up incomes as gross profit, debt as value, liabilities as assets and a down-at-heel failing business as tomorrows golden opportunity!

The words "Real potential for growth!" is always a danger sign.

You may not need @Clinton, but you definitely need someone like him - someone who can give you an honest appraisal of what a business is really worth to you.