“If I never have a cent
I’ll be rich as Rockefeller
Gold dust at my feet
On the sunny side of the street”
– Willie Nelson, On the Sunny Side of the Street
At the height of his wealth, John Davison Rockefeller Sr. was worth approximately $418 billion adjusted for inflation. If he were around today, he’d be wealthier than Jeff Bezos, Bill Gates, and Warren Buffet combined. He could spend $40 million a day every day for a thousand years and still have only spent around 10% of his total wealth. When accounting for interest, he could theoretically spend $40 million a day forever and never lose a single dime, but in fact, earn millions of dollars every day. Pretty mind-blowing, huh?
Now, that math you just read was more than a little suspect. If you bought it, I have some bad news: you probably won’t be the next John Rockefeller. But that’s OK, math is hard. And if you did see right through those sketchy numbers, I also have some bad news: you also probably won’t be the next John Rockefeller. But that’s to be expected. After all, even if you founded three companies as successful as Amazon, you likely still would not surpass his personal wealth.
So rest easy, knowing that we all fall into one of three categories: those who can do the math, and those who can’t. No matter which one you fall into, you can still achieve financial success on your own terms. And one of the most exciting, intriguing, and potentially fulfilling ways of doing that is to buy a business. But first, you need to ask yourself a series of questions, starting with “is Standard Oil still around and can I just buy that?” The answer, sadly, is no. The other questions are pretty simple: why, what, where, who, and how?
Why?
This is perhaps the biggest question you need to ask yourself when considering buying a business. You might think you understand your motivations well and that you don’t need to contemplate this essential question any further. And that may be true.
But as a thought exercise, try sitting down with a pen and paper, or a tablet and some kind of plastic pencil thing that never feels quite right, and write down all your reasons for buying a business. This exercise isn’t meant to dissuade you from the idea; on the contrary, outlining your motivations in detail will make answering all of the remaining questions a lot easier.
What will your answer be? Perhaps you are tired of working a 9 to 5, or you want an additional source of income. Maybe the allure of taking on a new challenge is too much to resist. Or maybe you just can’t stand the fact that some sandwich shops don’t give a pickle spear with every sandwich and you want to make things right by starting your own. Whatever the case may be, know the why before you know the-
What
What kind of business do you want to own? Choosing an industry to dive into should be based on more than personal preference. It’s great to be passionate about any company you own, but you also need to make a profit. Perform competitive analysis, find out how the business is doing currently, and do your due diligence on the profit margins and financial factors in that specific field. You need to look at demographics, long-term viability, and, if you are planning to purchase other businesses or already own at least one, possible synergies and partnership opportunities. One other major factor to consider is geographic location, which leads us to-
Where
This seems easy enough, right? You’ll probably want to buy a business in your community. Unless, of course, your community isn’t the best location. Don’t settle for a less than ideal situation just because it is close to you. The right business opportunity can change things dramatically, so you should keep your possibilities open when it comes to the idea of moving, commuting if your role will be hands-on, or operating remotely and leaving the day-to-day operations in the hands of a capable management team. Having a team you can trust is essential, you just need to decide-
Who
Whether this the first time you’re buying a business or you are a seasoned business owner, you’re surely aware of the importance of having a strong team in place at your new business. As the owner, you need to make sure that your management team is on board with your philosophy. Regardless of your level of involvement, the way the business operates every day reflects back on you, and it’s essential that you communicate your goals for the business in a clear way to your employees, while also listening to their ideas and concerns.
As you ramp up your business purchasing or ownership plan, you may have some concerns of your own. You know what you want to accomplish, the only question is-
How
Buying a business. Do you know why you want to, what kind of business you’re interested in, where it will be located, and who is going to help you run it? But how do you get your high-flying ideas off the ground?
It all starts with a plan, and one essential component of your plan is financing. That’s where a reputable partner such as Financing Your Way comes into play. With customized financing programs that actually meet your specific needs, rather than forcing a one-size-fits-all solution on you, Financing Your Way is an excellent choice for a range of financing options.
Don’t wait until you’ve gone through the why, what, where, and who of your plan to focus on the how. Start laying out your financial plan today with the help of our friendly team that connects you with the right lending partner for your particular requirements. Your new business may not make you as rich as Rockefeller, but with assistance from a knowledgeable team and a smart plan in place, you’ll be walking on the sunny side of the street when it comes to your next business opportunity.