People often ask which is the best business to buy or what industry is hot right now. It seems like an easy question, but it is actually something you need to think about.
The real answer is that the best business to buy has to do more with what you like and what you are good at rather than what is popular today. If you buy a company that makes a lot of money, but you hate going there, you will probably end up hating it and trying to sell it.
For example, I previously owned a maid service company. What I did not realize is that I would be dealing with the drama of the maids and the customers complaining. I sold it after 10 months.
The day-to-day of running a business
When looking at a business to buy, one of the most important things to ask the current owner is, “what do you do day-to-day“. You will probably have to dig a little deeper to get an idea of what they do, and why they do it.
They may say they go see customers, but why do they do that? Are they visiting customers to make a sale, or is it to fix a problem?
Expert Tip – Almost every business owner I have met is in the Human Resources business, but they don’t know it. Looking for, hiring, training, working through issues, and firing will probably take up a lot of your time if you have employees.
Are you comfortable doing that most of your day?
The key is to fully understand what you will do all day if you own that business and do you have the skills, attitude, and desire to do it. I like doughnuts, but I don’t want to get up at 4am to start making doughnuts,
Key questions about buying a business you need to ask yourself
- Do I want employees?
- Do I want to sell things or perform a service?
- Do I want to talk to customers regularly?
- Am I good at making sales calls?
- What hours of the day do I want to work?
- Do I want to sit at a desk or work outside the office?
- Could I fire someone?
- Do I want to work with my hands or my brain?
These are not all the questions you need to ask yourself, but enough to get you started thinking about what type of business to buy that is right for you.
Ask a friend what you are good at
We often do not really understand what we are good at vs. what we think we are good at. I think I am great with people but my friends tell me – aaahh, not really. A good idea is to ask someone who has known you for a long time and find out what they think you are good at.
Don’t be surprised if their opinion is different from yours. Sometimes the people closest to you know you better than you know yourself.
Go deeper on being a manager
If you are trying to figure out what you are good at you could pay a psychologist $100 per hour to figure it out in 6 months or you could read this book: Start With Why: How Great Leaders Inspire Everyone to Take Action. This is one of my favorite books and will help you think about what you are good at and how to be a good leader.
Click on the book image to learn more.
Final thoughts on the best businesses to buy
Find out what you like to do and what you are good at before looking for a company. Once you feel like you have a handle on your skills, look for companies to buy that you think need those skills.
Next, talk to the current owners and make sure you understand what their day is REALLY like. Hopefully, all of those things will line up and you have found out what type of company to buy.
Now go out there and change your life.
