I'm in the process of considering buying my first business, but before I do, I have a lot to learn
My question: I've found businesses listed that are, quite cheap, and currently affordable, even with the extra 10% GST (australia btw) but I've seen a them listed with rents, even thou i'm buying the business. So, if i'm not actually buying the business building (as I would intend to do).. what am I buying exactly?
Confusion: Buying a commercial business with a lease?
byu/specify_jai inbusiness
Posted by specify_jai
4 Comments
Real estate and the business within are two separate things. They can be sold as a package but often aren’t. Be careful. The lease terms or rent can make the business not a good investment.
You’d buy a business which “owns” a lease. You’d then have to follow the lease and pay rent to the landlord every month, as well as other real estate related expenses. What you’re buying is the space as it is set up, the right to lease the space as defined in the lease, any other business assets (equipment, customer lists, etc.), phone numbers, email, websites, etc. What you’re actually buying depends on each individual situation.
Depends entirely on the offer.
You could be buying everything – inventory, fixtures, debts, client list, equipment, etc
Or you could be buying the name only, or some combination of the above list.
A business that was listed most probably wasn’t able to sell through normal process. You are right, there is a ton to learn. DM me for a very small portion of clarity, I don’t want to turn it to a commercial here 🙂
You are buying the “going concern” – the nuts and bolts of an operational business that’s generating a profit. And there are two ways to do that – an asset purchase and a share purchase. They are vastly different and each has its pros and cons.
You should join subs like r/buyingabusiness and r/businessbroker and spend a fair bit of time reading threads. There’s a lot to learn, yes!