How do you find businesses failing that are for sale?

[andrewrichardgale]

I always hear/read (actually only read) storys about people finding a failing business and then flipping it around making money and then selling it. Honestly I love the idea of doing that, I was just wondering how do I find/look for these businesses that are failing?

[Enke]

Unless you really know what you are doing in the select niche or have good funding, I would be careful about buying failing businesses. Although you're right, you do read these stories quite often.

[capforge]

Failing businesses are easy to find- go to any business for sale website and look for businesses in your area and look through the listings. Any one with no cash flow listed is likely to be losing money. These businesses can be bought relatively inexpensively sooner or later. The problem is, three fourths of the time, the reason they are failing is external to the owner, meaning a new owner isn't going to do any better- either the location is bad, the rent is too high, there is too much competition, or whatever.

If you can find, buy, and turn around one of the 25% that are failing due to something the present owner is doing wrong, then you can do quite well. But don't expect it to be easy or cheap- you can't finance the purchase of a money losing business, and you will need a lot of cash on top of the purchase price to use in the turnaround process. Go in underfunded and you will be the next failing business owner.

[andrewrichardgale]

found one, thank you

[RLorenzen]

They're easy to find, but make sure you have the business knowledge (not to mention capital) to turn them around.