A starting out entrepreneaur - startup vs buying existing?? help

[MattyC]

Hi all -

I am brand new to this site and have enjoyed reading your posts - I was hoping you could provide me with a little support. I have been working as part of a large corporate in middle management now for a few years and have always longed to run my own business - problem being I never thought it was possible due to me still being only 27 yrs old. Recently, just to satisfy my curiosity, I started to research how I could possibly run my own business. It was pretty specifc from my research that I have 2 options 1) Get an idea and start my own business from scratch 2) buy an existing businss

I have never been that creative with ideas but I am experienced in the logistics of running a profitable organisation. With that in mind, I am thinking that buying an existing business would be more realistic and suited to my sillsets - however I am 27 and dont exactly have £1 million sitting in the bank to buy a seasoned business

I am really interested to find out how other young entrepreneaurs get started - I would love to hear your advice on how I should start to plan my route to running my own business.

Thanks in advance
Matt

[rogercbryan]

There are literally books written on this topic. You need to start be deciding what type of business you want to have. You then need to examine the difference between buying or starting a business in your chosen industry. To generally say to start or to buy means you have missed the first (and many other) step(s). Pick an industry... pick a product or service... do your research... write a business plan... examine the variables between starting a new company and buying an existing company. When you start working on this you'll find the right direction.

[qvalpro]

You should do a lot of ground work as rogercbryan has rightly said.

[genevie]

I have never been that creative with ideas but I am experienced in the logistics of running a profitable organisation. With that in mind, I am thinking that buying an existing business would be more realistic and suited to my sillsets - however I am 27 and dont exactly have £1 million sitting in the bank to buy a seasoned business

HI,

That would be great question..Then its better to buy some existing business though it is really more realistic and you couldn't find any problem for that than starting the new business...

[foldquads1]

my opinion since its your first business you should start it from scratch. there will be many things things to learn that you miss out on if you buy a business, and these valuable lessons will most likely be needed when the business is established also.

[Southern_Lenders]

Starting your own business can be done much cheaper, thats for sure. The cost of larger franchises can be in the millions, and even for a small franchise, 10 to 20,000 JUST for the franchise fee is very common and is the average according to allbusiness.com . Some franchises require that you have a liquid net worth of "X" amt of dollars, and possibly even previous experience in the industry. Its impossible for anyone to say what the best choice would be for you, because its all about your personality along with how much $ you have to invest as well.

[grnthmb55]

The beauty of buying an existing business is that you start off with an existing clientele. The business has presumably been around for an amount of time, and probably efficiency is streamlined at least to an extent. The seller may be willing to train you in an industry in which you might not have much experience.

That being said, I started my own business from scratch. However, I did not go into it absolutely blindly. I worked at a privately owned ice cream/ hot dog/ hamburg restaurant for a period of time before starting my own concession business. I started 5 years ago with one trailer, and now I'm up to 3. Working at the restaurant allowed me to get contact information for suppliers and repair technicians, and gave me some good tips on how to handle high volume. It opened my eyes to the fact that there is very high profit margin on some very simple items, such as soda, coffee, french fries, and ice cream.

My advice would be to decide what industry you want to go into, then get a job in that industry to learn the ins and outs. Then, you'll have a foundation on which you can build your own business. I'm 28 years old... I've been running my own business since I was 23. There are plenty of people our age that run successful small businesses. You've just got to find a niche and fill the void. Anything is possible. I graduated college with a degree in horticulture, worked for 6 months at a fast food restaurant after graduation, and now make my living primarily through my three concession trailers and by organizing a festival. You never know where life might lead you. Good luck.

[nigelstephnie]

I guess age doesn't matter when it comes to business, I have acquaintance has establish his own real estate company and now earning well.

[akula]

It was pretty specifc from my research that I have 2 options 1) Get an idea and start my own business from scratch 2) buy an existing businss

yea..without taking anything from
rogercbryan, the decision between acquisition vs. greenfield operation is an interesting one
as a rule of thumb, if you can acquire the business that you want to buy (i.e. there are sellers), then you should.
acquisition is a more risk efficient market entry strategy than greenfield for a number of reasons.
the obvious ones are that it's easier to finance an acquisition, there are systems in place, and generally it's just less risky (without going into specifics)

[gobabygo]

From what I've learned so far, there's a huge line between the pro's and con's of each.
when you buy an existing company, depending on the condition the company was left in, could either continue to turn a profit, or is on the verge of backpeddling. It could in most cases, have a huge upfront cost on purchase.
Starting up a business from scratch can take a lot less money for initial investment. But the risk of failure is high, depending on what your stratetgy/market angle....a lot of variables. good luck

[maksim]

Do yourself a favor and pick up David gerber's "e-myth"

If you think your biggest challenge to starting a business is your age,/money and question of starting your own vs buying, you are in for a rude awakening.

1. Buy "E-Myth"
2. Find a mentor.

[staff india]

thats really interesting

[Lemonade]

Kidding me? 27 is plenty old enough. Just figure out what you want to market to and do it.

[lccglobals]

Its not always good nor bad to buy a existing business, some time you get cheated even that business seems to be running good and some time its also possible to start up a business and get a lot of customer and income too. always make a market research for what type of business you are going to start or still thinking of doing, or you may also contact a business consultant for a good advice which help you setting business , Auditing, accounting, taxation, company registration and some more important things on a priority basis.

[tjmollahan]

Regardless of whether you buy or start from scratch, if you are following a passion you will be just fine.

I have read research articles arguing both ways. An establish business will have networks in place but will require the new ownership to continue to add value.

If you start from scratch you will need to be intentional with every penny.

The short of it is do what you love.