When an opportunity to grow your business through buying or taking over another business comes along, you want to be able to act! Aquisition or purchase finance facilitates this. It is often done on the strenght of the business buying and or the business being bought and the people behind the businesses.
What is the goodwill vs. the stock and hard assets, is it for a merger or balance sheet restructure, what are the cashflow and expenses, what type of business is it and how does it complement the existing business.
A franchise owner was going into his third year of operations and the business was operating well. Cashflow was stable and in fact growing, systems and key personal were in place and knew what to do, the franchisor was very pleased with the operator. The owner was ready for the next step up.
When the owner met up with the franchisor it came up in conversation and a few months later the franchisor presented a store that was being sold by the owner. The store was in need of a facelift and a fresh approach from an experienced operator. The client knew he would be able to turn the store around. through a due diligence process where cash flow, cash reserves, equity and operating history/experience was checked it was possible to extend an aquisition facility for the purchase. The owner now had a new challenge and more income, staff morale improved and the store went from flat performance to growth. A win win.