How to Negotiate a Business Buyout

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Negotiate a business buyout by getting a CPA and attorney involved to write up the contracts, researching the value of similar businesses and using the annual income of the business to come up with a fair price. Use the Internet as a tool to assist in coming up with a fair business buyout price with advice from a business professor in this free video on business buyouts.

Part of the Video Series: How to Open a Small Business
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Video Transcript

Hi, my name is John Niemira, and I wanted to talk to you today about negotiating a business buyout. I presume that you're looking to buyout somebody's existing business, a current business that's open. Couple of things in buying out a business, definitely want to involve professionals in this, your CPA and your attorney before the final papers are drafted. You want to get the value of their business. There's a couple different ways to get the value of their business. You want to go on what the annual income is but also maybe what they have for stock in merchandise. If you're buying out an existing business that is just providing a service, then you can go on annual incomes. Different businesses will give different prices for their business. You want to get on line to see what current values are. They are from one to three times of the annual income is usually the value of the business. But the best way to get those kind of values is go to a broker. Get on line, find a good broker, see what businesses in the same genre are selling for, what they're valued at, what they have for merchandise in stock and what are you actually buying. Then you can start your negotiating price from there. If you need anymore infromation on this subject or any other subject in the business field, my email address is


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