How To Buy A Business In Florida: The Ultimate Guide

Florida is undoubtedly one of the best places to own a business in America. The state offers fertile soil for thriving businesses and eager entrepreneurs due to its touristic nature. In this sense, many people may opt for acquiring an existing business instead of building one from scratch.

This type of strategy offers some advantages, such as immediate returns and established business operations. Plus, business owners in other states may use it to diversify their investment portfolios.

According to data provided by SBA (Small Business Administration), more than 50% of startup companies fail due to unproven concepts, lack of working capital, and poor management. Hence, typically it is safer to buy an existing business.

In this article, we provide you a full guide on how you can buy a business in Florida.

Ensuring a Successful Business Acquisition – Necessary Precautions

Some people may think that acquiring an existing business is just as simple as contacting the current owner, placing an offer, paying the amount, and signing a contract. It is true that the procedures are not rocket science but oversimplifying the process can be dangerous.

First, you need the guidance of professional advisors, which includes:

• An experienced business broker.
• A certified accountant (preferably an individual seasoned in the field).
• An expert business attorney in Florida.

An experienced business broker will assist you in finding a business and coordinating the procedures, while the accountant will be responsible for all due diligence process, including tax and record-keeping issues.

Last, you will need expert legal advice to deal with all organizational requirements and legal documentation. Make sure you have a business attorney on your side to guide you throughout the process.

Finding a Reliable Business Broker

Being assisted by a trustful business broker in Florida will save you time and money. This expert will assist you in locating a business that meets your criteria for acquisition, working rapidly and professionally.

To ensure you have a reliable business broker on your side, you need to evaluate the services of the broker, be it an individual or a business. First, you can check if the business broker is a member of a major class organization, in which professionals/companies are obligated to adhere to specific practice standards and work ethic.

In Florida, you can search for professionals linked to organizations such as:

• Business Brokers of Florida (BBF)
• Florida Business Brokers Association (FBBA)
• International Business Brokers Association (IBBA)

Therefore, do not forget to ask for testimonials of former clients and customers to fact-check the reputation of the business broker.

Discussing Your Qualification As a Company Buyer

Once you have the right business broker to help you find a company to buy in Florida, you need to sit down and discuss your qualification as a buyer.

This way, your business broker will be able to define what business is more suitable for your situation based on your background, work experience, and financial ability both to purchase and to manage the business.

In this case, you need to prepare a financial statement, which will be required by brokers, sellers, lenders, landlords, and anyone who takes part in the eventual business acquisition.

Commonly, questions asked frequently by business brokers in Florida include your reasons to buy a business, what your educational background is, your previous experience managing a business, and other personal questions.

As buying a company involves finance as a core factor, business brokers in Florida may ask you:

• What is the maximum amount of your funds you can invest as a down payment?
• How much do you expect a partner to invest in their funds? (In case you have a potential partner).
• In case you need a loan, are you willing to pledge personal assets as collateral to obtain the necessary amount?

Once the business broker has all the necessary information, he/she will help you to define your acquisition criteria, including the business category you are interested to buy, what business category you are not interested to buy, the company’s location, etc.

Reviewing Potential Choices

Once the business broker has your company buyer profile done, he or she will proceed to review various businesses that may potentially meet your criteria.

In this phase, access to profiles that provide a company’s summary and financial information will require you to sign a Confidentiality Agreement. This type is required by business owners and brokers to protect sensitive information.

Let us say you find an interesting business you may be interested in. What happens next? Now, your business broker will proceed to schedule appointments with the business owner.

A face-to-face appointment is a great chance to solve your remaining questions, as well as reviewing the company’s facilities and operations. In this sense, business owners commonly require all meetings with potential buyers to be during non-operating hours, to avoid premature disclosure of information.

We recommend not discuss the price and terms of sale with the business owner while you still visiting the facilities and overviewing the company’s structure and operations for the first time.

Transition Phase is Crucial

Once the conversations were successful to turn into a deal, both business parties (buyer and seller) will proceed to close the sale and prepare the transition phase. It is essential to ensure you have the confidence of your new employees, as commonly they are not aware of the sale until it is closed.

Once you have bought the business, the buyer needs to introduce you as the new owner and reassure the employees will have their jobs secured, to guarantee a smooth transition.

In case your new business possesses proprietary information, protect it, and keep it utterly confidential. Do not disclose it with third parties outside your professional advisors and spouse, always reminding them to keep it confidential as well.

Signing the Contract and Due Diligence

At this point, you need to have all company’s operating information and financial summaries reviewed. It is crucial to have all the questions answered fully, with no room left for potential gaps, errors, or unforeseen issues.

After you have ensured the company fully meets your criteria for acquisition, you can proceed to prepare and sign the contract. In this phase, you must have the guidance of an expert business attorney in Florida to oversee all the procedures in detail.

Also, as recommended before, make sure you have the assistance of a certified accountant to help you as well. The final stage of acquiring a business is demanding and highly detail-oriented, which is time-consuming for both you and the business owner.

We Can Help You Buying a Business in Florida

You do not need to face uncertainty and stress while acquiring a business in Florida. Get help with an expert attorney from Jurado & Farshchian, and we will guide you throughout the whole buying process.

Get in touch with Jurado & Farshchian today by calling (305) 921-0440 or by sending us an email to [email protected]. Waste no time- contact us now.