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Owning a winery is a common dream. But for Long Beach, California, entrepreneurs Tracie Parker and Marcus Crawshaw, buying a wine shop and turning it into a destination was their reality. Parker and Crawshaw, both 35, started their due diligence as soon as they heard about The Wine Crush and purchased the business in January 2006.
Finding a business to buy can be a great way to jump into entrepreneurship. But don't think you're taking a shortcut--the research, negotiations and transition can take up to a year, says Julie Gordon White, a business broker and founder of BlueKey Business Brokerage M&A.
Your first step is assembling a team, which should include an accountant, a transaction attorney, a banker, a business broker and an industry specialist. White explains that a good seller has faith in their business and will often finance a minimum of 10 percent of the purchase price--sometimes even up to 50 percent. "That demonstrates that the seller believes the business will be healthy in the future," she says.
For listings, check out BizBuySell.com, BizQuest.com and BusinessesforSale.com, suggests Richard Parker, author of How to Buy a Good Business at a Great Price. Peruse your local newspapers as well as industry trade publications, and network with local professionals who might know of a good business for sale. You can even send letters expressing your interest to businesses that aren't officially for sale, says White.
Tracie Parker says due diligence and consistent communication with the previous owner helped make the transition smooth for her and her husband. "The old customers have been very impressed with the improvements we've made and the speed at which we took over," she says. "And we gained new customers who now come in weekly." On top of that, The Wine Crush location has doubled its square footage, and sales have reached well into the six figures.