Starting a business from the ground up is a lot of work, and there’s no guarantee that everything you put in will pay off. That’s why buying franchises is so appealing; they already have a track record of success, thereby eliminating much of the risk. The most favorable options also happen to be expensive, but, for many, they are the perfect compromise between starting your own company and entering into a franchise agreement. Before taking the leap, Robert A. Schwartz, a real estate lawyer from Rochester, NY, advises considering the pros and cons of doing so. He shares a few details to keep in mind. 

The Advantages

Your two most valuable resources are time and money, and buying an existing business can save you both. It’s not uncommon for new companies to operate for years before earning a profit, but any business worth buying should already be making money. Even if you plan on upgrading various elements over time, you should be able to hit the ground running from day one. There will be no need to purchase essential equipment or stock an inventory—both of which can take months—because any reputable company will already have everything needed to provide its products or services.

The Drawbacks

Despite the many advantages of purchasing a thriving company, a good real estate lawyer will make sure you understand all possible drawbacks, as well. For example, the current staff—whom you do not know and did not hire—may be resistant to change. Hiring an entirely new team, on the other hand, means you will lose valuable industry knowledge.

Keeping old customers and acquiring new ones will also pose challenges. Loyal customers may not want to do business with a stranger, while new ones may be skeptical despite new management because of a negative experience they had in the past. Further, there is always the chance the current owner is lying about various aspects of the business. They may have implemented poor financial strategies that standard due diligence does not reveal. 

If you’re thinking about buying someone else’s company, including the property on which it operates, a real estate lawyer can evaluate the deal to ensure it’s in your favor. To discuss the terms of the agreement with a seasoned attorney, contact Robert A. Schwartz. Based in Rochester, NY, this strategic negotiator helps clients protect their investments. He is well-versed in various financial proceedings, including buying companies, declaring bankruptcy, and distributing assets. To learn more about his experience navigating commercial real estate closings, visit the firm online. You can schedule an initial consultation with this real estate lawyer by calling (585) 334-4270.