If you didn’t get the chance to check out the first article on buying a business, get up to speed here.

The Drawbacks

Simply put, buying a business presents a completely different opportunity to owning a business than the traditional “start from scratch” strategy that a lot of us are familiar with. Before jumping in, you get the chance to see how well the business is running before you make a decision. If its something that has passed your screening process and it’s something you are considering, chances are the business is structured well already. Of course, this means that there’s less risk involved and maintaining the business shouldn’t be an insurmountable task, theoretically speaking. As well, with a stable business, most likely a steady positive cash flow will accompany it. When it comes to market share, starting a business creates more competition, whereas acquiring a business maintains the existing market share. As you can see, the benefits of buying a business are clear, but before you head to the bank or go running around frantically searching for businesses, there are a few other things to consider.

Park Place vs. Baltic Ave…

The first thing you have to understand that it’s going to cost you a lot more to buy and existing business than to start your own. Built in to the cost of a business is the sweat equity, the time and effort that the original owner put into the business to start it and get it off the ground. It was them that took the risk for you and spent countless hours developing a foundation and you can expect to be paying for every bit of it. Essentially you’re paying a premium price for someone else to create a business. They’ve already created a brand name for themselves and you’re not just buying the business, you’re buying the brand name too.

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Whether you’ve been thinking about moonlighting or going full-time with your own business, right now is the best possible time to get started. I know what you’re thinking: “Hey Jason, you read the news, right? We’re in a recession. Nobody told you?” Oh, they told me. They tell me every single night on the news how everything is doom and gloom, how gas prices are up, foreclosures are up, the mortgage crisis…blah, blah, blah. Guess what, I don’t care what “they” say, I’m still right. Now is the best time to get started and now always has been.

Everyone loves a good list so here’s a VERY short list of some of my favorite reasons why you should start a business RIGHT NOW. Here we go…in no particular order:

Businesses have tax benefits

So, we’re in a recession and money’s tight. News flash: if you start a business, you actually get to keep more of your money! I’m sure you’ve heard the staggering numbers about companies, BIG companies, that pay little or no tax. I’m not suggesting that you’ll be in the same boat, but every dime counts.

Start a business, even a side business, and a whole slew of expenses — such as the cost of your Internet connection, mileage on your car, and even a portion of your home — now become at least a partial write-off on your income tax, which means you pay less. There have been years that I made over $200,000 at my job, and still managed to get money back on my taxes. That was all because of my side business. Obviously, you’ll need to consult with someone who knows tax laws and such, but trust me, it’s worth it. Nuff said.

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Steve Farnsworth is a serial entrepreneur and a student at Fort Lewis College and at the age of 24, a Young Go Getter! Check out his site Burner Sports, where he serves as the President.

Anyone who has ever bought a car or a house from a dealer knows that sales people have MOTOR MOUTHS! It’s a fact, just call up any real estate agent, or car salesman, and you won’t be able to get off the phone until you commit to something. These two industry’s are an exception to what I am about to tell you. Real Estate Agents and Car Salesman are paid to talk, yet even they should know their limits.

I worked for an Environmental Chamber Manufacturer for about three years (I still do consulting for them), as a sales associate. It was primarily a position where I would make sales calls and receive sales calls. We were trained to do 2 things while on the phone with a prospect, or a current customer. The first thing we were trained to do was keep the conversation brief. I would time how long I was on the phone with each customer by using a stop watch that was always on my desk. I was trained to keep the conversation at about 3-5 minutes per sales call. This was a typical sales call, some situations required more time because more knowledge and information was communicated back and forth which is perfectly fine.

The second thing that I was trained to do was to ask questions. I would ask a lot of questions. This gets the customer talking; it gets them excited and engaged in the sale. I would just sit back, listen and take down as many notes as possible, which could be used for the next time we talked. This process of listening also allowed the buyer to sell themselves in many ways, I mostly just had to supply the information that they required. Sure I would talk about why our products are better than ‘the other guy’s’, but the real sale was made when I asked questions that allowed them to see the benefits in our products without me saying too much.

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Ryan is a twenty something attending graduate school in Texas. He fancies himself an entrepreneur and writes about relationship marketing, eCommerce, and other elements of business as it relates to Generation Y, on his blog, Ryan Stephens Marketing.

Most of the MBA students I know think they are absolutely brilliant. Because of the piece of paper they get when the graduate they will probably get to start out at about $100K a year. Evidently this notion, coupled with their narcissism, entitles them to think they are better than you and me. And that is okay with me because I am confident I can attain that status (provided I want to) in the amount of time they spent in the ‘real world’ and coming back to get their MBA.

The rest of this post outlines 3 reasons why you should skip obtaining your MBA or .

Reason #1: It’s about PEOPLE — not rules, theorems, and formulas.

Being a great business person, or a great marketer is about connecting with people; it’s about building and solidifying relationships, and it is about making your brand a Lovemark. Managerial Cost Accounting doesn’t help you do that. I do not want to spend my life tucked away in a cubicle (or an office), but out on the streets interacting with and learning from consumers. What do they really want? How can I facilitate our relationship by providing them with the solution they are looking for?

What theorem teaches me how to do that? When you start seeing your business as a business of margins you are in danger of becoming a commodity. You can learn all the strategies in the world to get attention for your business, but what do you do when you get it? Is it sustainable? Learning about the people, your consumers and what they want enables you to thrive and consistently answer these questions. A piece of paper that dictates how well you ran regressions does not.

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A Look at the Benefits

We can all remember the days as a kid where we wanted to be a cowboy or an astronaut when we grew up (I still think being a cowboy would be kind of cool). Then the year after that, maybe you’d have the desire to be a pro hockey player or an movie star. Eventually, we’d all grow up and some of us would go to college while others entered the work force. With that, our childhood dreams evolved as well. For some of us, they evolved into running their own company, the desire to work for yourself as opposed to working for someone else. Now, a lot of you here are already in the driver’s seat cruising down that path, you own your own business and somewhere along the line the thought of buying an existing business has strolled through your mind. If you’ve ever found yourself in that position, you’ve probably asked yourself questions like “Is it right for me? If so, where do I start?” There are a lot of things to think about and the choices you make can greatly impact the outcome. In a series of upcoming articles, I’m going to touch up on some details of buying a business.

You Don’t Exactly Need a DeLorean…

Alright, so you may not be able to tell the future (…yet. Great business idea here, folks.), but there are ways around that, which can prove equally as beneficial. When you’re looking to purchase an existing business that is up and running smoothly, you get the chance to know what you’re getting into before you actually get into it. The opportunity to look at all of a company’s bookwork allows you learn a lot about the company besides just the numbers. The more organized the bookwork is, the better the chance that the company itself is well organized and properly structured. Just like buying vegetables at the supermarket, you get to look for what you want without having to spend the time growing it and not knowing how it will turn out.

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