Buying a business – what mumtrepreneur need to know
Photo by Ketut Subiyanto on Pexels
The same qualities that make the best entrepreneurs are found quite naturally in a mum. We may make light of what mums go through daily to get their kids through the day, but this on-site training was preparing her for business in ways she might not have expected. For example, they have the self-discipline to get the job done, persistence, a clear sense of direction, and creating in and out of chaos. Using the skills and capacities she’s built through child-rearing lends any mum to be a brilliant entrepreneur, should she choose to become one.
So it’s time for mums to go into business, and here is how! First off, are you purchasing or starting your own business from scratch or are you franchising?
There are some things to know; when purchasing a business, there are generally two methods: commercial share purchase or an asset purchase.
A commercial share purchase means taking over a company. The target company is a separate legal entity that will include all of its assets, liabilities, obligations, and any inherent or historical problems. One benefit is that continuity is maintained as contracts with employees, suppliers, and customers remain subject to any specific “change of control” provisions. For sellers, they are taxed on the proceeds of the disposal of their shares.
An asset purchase is the transfer of specific business activity and related assets and employees. The buyer can cherry-pick the assets it wants or, more particularly (other than in respect of employees), identify what, if any, liabilities it will take on.
However, if you would rather not worry about this, another solution is to start a franchise business.
The franchise industry turns over £13.7 billion per year, and in the UK alone, there are 930 franchised brands. Buying into a franchise offers stability and support but can initially be more costly than starting a brand new business. However, business start-ups let you control the company the way you intended, allow creativity, and can reap huge rewards with a lot of hard work.
Let’s say you are working for yourself on a great business. Still, it may not be going as well as you hoped; if you are working for someone else and can see the potential for growth in business growth in a business model that is not being exploited, well, a franchise could be the answer!
By franchising, you take a proven business or business model, customers know you, and you are aware of your products or services and already have a desire to buy from you. Furthermore, the franchisor will provide you with the tools to communicate your message. They will also have access to a history of what works and what doesn’t and best practice guides on everything from social media to local newspaper advertising.
Statistically, franchises tend to have better success rates than non-franchised businesses. 93% of franchisees claimed profitability in 2018, whereas only 40% of new businesses survive more than three years
Getting a franchise means there is ongoing support for you; your franchise business will align with HQ and have a distinctive voice that leads to web traffic, incoming calls, and regular referrals.
