KLE 113: 4 Absolutely Vital Questions
Although, you won’t find these four questions in any text book, they are the 4 absolutely vital questions to ask before you buy (or start) ANY business:
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… who do you think had the last laugh in that little deal?
This does not mean that you should routinely overpay for any business that you may acquire; quite the opposite: often for a business – particularly a business with commitments (e.g. a retail store with a shop lease), the right amount of ‘goodwill’ to pay (i.e. the amount that you pay for the profits of the business, less any inventory, buildings, vehicles, or fixtures/sittings included in the price that you eventually negotiate) is often zero. That should be your starting position – and, often also your ending position – as merely relieving the current owner from their financial obligations (e.g. taking over their leases) may – and, probably will – be sufficient to get the deal ‘over the line’.
