by Mike Handelsman
While current economic conditions are no doubt making many potential business buyers think twice about continuing the search, the increased availability of seller financing combined with lower business prices has actually created an ideal situation for buying a business.
It’s true that the economy has made it increasingly difficult to access financing from lenders for a business purchase, but at the same time this lack of funds has necessitated that business sellers become much more flexible when it comes to offering financing. More and more sellers are recognizing the fact that they have to be willing to finance at least part of a business sale in order to attract buyers and successfully close transactions..
With seller-financed businesses, the dream of owning a business can become more of a reality for aspiring buyers, who are growing in number. As a result of massive layoffs and formidable economic conditions, a greater number of people are realizing that buying a business is a viable, attractive alternative to searching for a traditional job.
In addition to it being easier than ever to access seller financing, business buyers can take advantage of declining sale prices. As a result of the economy, business sellers have not only had to become more flexible in offering financing, but also settle for lower prices.
This all means that if you’ve been thinking about buying a business, now could be the perfect time to do so.
Although it can be particularly risky to attempt to succeed with a new business in a down economy, if a seller is willing to finance part of a sale, buyers can take comfort in the fact that the seller has a good level of confidence in the business and its ability to thrive even in tough times. If that isn’t incentive enough for aspiring buyers, decreasing prices might be just what it takes to give them the confidence to take the final step.
As always, though, buyers must be sure to do all of the necessary research and due diligence before entering into a purchase. It’s more important than ever to understand exactly what you are buying. BizBuySell.com recommends that buyers engage trained professionals (e.g. a business broker, accounting firm or due diligence consultancy) to help them assess the business before signing a purchase agreement.