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Thread: Never buy a business just because the price is right...

  1. #1
    Moderator Kay is a Premium Member
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    Never buy a business just because the price is right...

    ... it's more important to make sure the business is right for you.

    I wondered if anyone might have anything to say about this. I don't completely agree with it as I think it depends on what you're planning to do with the business. If you're going to turn it around and sell it, then I don't see that the nature of the business matters so much. If it's going to be your main source of income then it's a lot better if it is right for you.

    Maybe the author meant "right for you" in terms of playing to your strengths.

    What do you think about it?
    British Expat - helping people to live and work abroad since the year 2000.

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    Top Contributor grynge is a Premium Member
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    If I was certain I could turn it around for a profit either but taking it into higher profitability or selling off the parts then yeah it wouldn't matter much to me what kind of business it was, the corporate raiders of the 80's would just buy companies that the parts were more valuable than the whole, the big internet boys have been buying up companies wholly and solely for the companies patents.

    If you are buying it for a lifetime job then maybe you should look at how much it will give you enjoyment?
    And they thought me broken, that my tongue was coated lead, but I just couldn't make my words make sense to them, if you only listen with your ears ... I can't get in
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    I would restate the point as:

    Never buy a business just because the price is right...
    ... unless you know what you are going to do with it.

    As grynge pointed out, planning to turn around and sell the site as a profit is a reasonable reason to buy a site, even if it doesn't fit your long term master plan for your life.

    The problem is when there is a low price and the buyer simply thinks the deal is too good to pass up. He or she thinks "At that price, I should be able to do SOMETHING with the site" but doesn't have a clue as to what that "something" is. I've seen it happen with things ranging from items at estate sales to businesses, including websites. It usually turns out badly.

    If you plan to sell the site "as-is" quickly, so be it. If you plan to fix the site first and then sell it, you'd better have some idea of how you would fix it. If you plan to run the site indefinitely, you need a plan for that, too.

    Jumping at an opportunity, without any plan, simply because the price seems cheap is a mistake.

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    Quote Originally Posted by David S View Post
    I would restate the point as:

    Never buy a business just because the price is right...
    ... unless you know what you are going to do with it.

    As grynge pointed out, planning to turn around and sell the site as a profit is a reasonable reason to buy a site, even if it doesn't fit your long term master plan for your life.

    The problem is when there is a low price and the buyer simply thinks the deal is too good to pass up. He or she thinks "At that price, I should be able to do SOMETHING with the site" but doesn't have a clue as to what that "something" is. I've seen it happen with things ranging from items at estate sales to businesses, including websites. It usually turns out badly.

    If you plan to sell the site "as-is" quickly, so be it. If you plan to fix the site first and then sell it, you'd better have some idea of how you would fix it. If you plan to run the site indefinitely, you need a plan for that, too.

    Jumping at an opportunity, without any plan, simply because the price seems cheap is a mistake.
    Knowledge in any given area not only provides the ability to enhance and improve what one has purchased, but it also adds the element of personal involvement, which is very instrumental in helping to sell the product. Buying and selling outside of a person's area of expertise would tend to be much more speculative and risky.

  7. #5
    Top Contributor crabfoot is a Premium Member
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    Old German proverb:
    Kauf bedarf hundert Augen, verkauf hat an einem genug


    Which loosely translates as

    A buyer needs a hundred eyes, a seller only one.

    Succinct ...

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