How Do You Choose the Right Business?

Often, the decision to go into business for yourself is prompted by an independent and entrepreneurial spirit rather than an interest in a specific industry. Remember that buying a business is a major financial commitment, and in order to make an educated decision, it's important to ask yourself some key questions:

• Do you want to sell a service or a product? Answering this question can help narrow the field of potential businesses considerably.
• What is your price range? How much are you willing to spend (and how much can you afford) to buy the business that´s right for you?
• Do you want your business to be location-specific? Location is often crucial for a business to be successful. Is the business tied to a specific location or will it be viable if you — and it — move somewhere else? Are you willing to relocate for a particular business, or are you only considering businesses in your area?
• What type of owner do you want to be? Consider what level of involvement you plan on taking as an owner, and examine what industries will enable you to match that type of commitment. Also consider whether you want your business to be your passion or whether it is strictly a financial investment — or somewhere in between.
• What is the ideal size for your business? Do you want to manage five employees or 50? Do you want to grow the business considerably, maintain the status quo, or downsize? How big is too big?

As you answer these questions, you'll likely think of more. Don't be afraid to survey other small business owners or consult a business broker about the appropriate criteria for selecting a business. When you find a particular industry or trade that matches your criteria, you'll want to ask more specific questions about that business such as: Why is the owner selling? Never be afraid to ask questions. For a purchase of this size, you deserve all the answers you want.