As a business buyer, the number that will be at the center of your attention throughout the business transaction is the purchase price. Just how much are you willing to pay for the business, and how does the seller arrive at their asking price? These are important considerations, and as you progress through the due diligence phase, you will be evaluating the value of the business.  You have already evaluated the inventory; now let’s take a look another hard asset, the equipment and furnishings.

Part 2: Equipment and Furnishings

These parts of the business are important in terms of value because they are considered hard assets, so you will need to know what furnishings, equipment, and office equipment is part of the deal.

For any equipment you will need the name and model number for each piece, the present condition, the value when purchased, the current value, and whether the equipment was leased or bought.

You will also need to consider what kinds of changes and improvements to the building will be needed in order to suit your business plan.  Find out what the seller invested in terms of maintenance and leasehold improvements so you will know what it will take to keep the facility in good condition.

Please see Part 1: The Inventory and Part 3: Financial Records and Contracts for a continuation of Evaluating the Value of a Business Before You Buy

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com