PDA

View Full Version : Should I buy this business?


ash21love
10-12-2015, 07:04 PM
A friend of mine mentioned his family member wants to sell his businiess he has. It's an online site selling retail goods. Been doing it for a few years now. He has proved to have increased sales 15% year over year....

This business is priced much lower (40% lower) than what a business with their earnings size should be priced at, due to not forming an official 'company'... He instead was running it out of his house and tracking sales and profits through auditing his checking account. Never formed a company of any sort...
But I have looked at his financial statements and was able to verify the earnings he stated. (Now if I intend to buy this business, I will take extra measures to ensure the statements are legit and so fourth, but lets just assume they are.)

My thoughts are to buy the business and make it legit (formally) , maintain or grow the earnings for 2 years, then turn around and sell the company...
I would already be buying it at a discount, so I already have "40% equity". Then keep the same or grow more earnings with clean books and records and sell it off...for full value... I am thinking this would be a good "business flip".

Does this sound nuts? Would you do it?
Fulcrum
10-12-2015, 09:12 PM
So is this your business or your friends business? Your other post (http://www.small-business-forum.net/accounting-and-taxes/15660-help-figure-business-worth-sell.html) says that it's yours.
Freelancier
10-12-2015, 10:37 PM
It's so difficult to follow along when people try to be too clever about concealing what they really want.
ash21love
10-14-2015, 12:49 PM
Who cares??
Fulcrum
10-14-2015, 04:21 PM
Who cares??

The attitude that this response shows tells me that you're just fishing and don't really care yourself.
ash21love
10-15-2015, 11:05 AM
No, I posed 2 different questions because I wanted insight on both questions that I had. But apparently people get upset about personal specifics that really don't matter. The questions I asked are totally different situations and I just simply wanted some advice on both. Kinda thought this was a place where you can ask business questions..... SMH.
Fulcrum
10-16-2015, 04:46 PM
No, I posed 2 different questions because I wanted insight on both questions that I had. But apparently people get upset about personal specifics that really don't matter. The questions I asked are totally different situations and I just simply wanted some advice on both. Kinda thought this was a place where you can ask business questions..... SMH.

First, reread both of your posts and ask yourself how I came to the conclusion I did. The details you provided are so similar that we have to question your authenticity as well.

Second, you're right that this is a business forum. You are allowed to ask questions here and, for the most part, you won't get trolled. There is a wealth of knowledge here and experience that just can't be purchased. This is also the only general business forum that I've found that is active and not just a spam fest.

When you respond with a, and I quote, "Who cares??", what do you expect us to think? My initial thought when you gave this response is that you don't value the information that we might give you.