Many people find the idea of starting and running a small business exciting, but they lose motivation as they begin to understand the numerous details that must be addressed prior to starting out. The primary advantage of buying an existing business is that much of the work is already done for you. There is a significant reduction in start-up costs, time, and energy. Additionally, cash flow may be quicker to start, thanks to existing inventory and receivables.
There are also disadvantages to buying an existing business. The biggest is the initial purchase cost. The business concept, customer base, brands, and other fundamental work have already been done for you, so the value may be higher and therefore, the cost of acquiring an existing business is usually much greater than starting from scratch. Additionally, it’s more difficult to take an existing, branded business and make it your own.