How to Buy an LLC
If you have a great business concept and business skills you might already be planning your LLC formation. However, you might also be considering how to buy an LLC, especially if you are unsure about starting a new business and find the idea overwhelming.
Why Buy an LLC?
So, why might you want to know how to buy an LLC? First of all, you get access to a business that is up and running. Everything will be in place and the business should already be making a profit. You’ll be able to avoid challenges such as the six-month Google website penalty for new websites, for example.
As an established brand, you will already have a customer base that you can just concentrate on expanding. You will likely have access to potential customers as well, such as followers on Facebook or a mailing list.
If you are purchasing the type of business you would have developed from scratch, then you’re not going to have to compete with them, which can be a significant advantage.
Why You Shouldn’t Buy an LLC
This is an expensive option, but if you can receive a salary immediately, it could save you money in the long term. However, you will need to love the branding as it can be expensive to rebrand a business. You could also lose both current and potential customers if they fail to recognize or identify with your new branding.
You could also be stuck with the logo, products or concepts you don’t like as well. It could also be challenging for you to make the business your own and there might be limitations on the business such as permits or the operational reach of the business. It might also be less rewarding than starting a business from scratch.
How to Buy an LLC
Here are the instructions on how to buy an LLC.
1. Find an LLC for Sale
First of all, you’ll need to find an LLC for sale and you can do this by looking at business for sale listing websites. There are many to choose from, so check the terms and conditions carefully. You will need to research any business you are considering purchasing thoroughly.
2. Find out more
First of all, you will want to talk to the business owners to find out more about the business and why they wish to sell it. Use your due diligence and investigate any business you are considering purchasing thoroughly. Check all their records, operating agreements, registrations, articles of organization, business accounts, licenses, etc. You might need to sign a confidentiality agreement. Consider hiring an attorney at this stage, and possibly a business advisor or mentor could be helpful.
If you have thoroughly investigated the business and are considering making an offer you can express your interest with the owner or salesperson. You will need to negotiate the price of the business and ensure you have covered everything in the contract. Be sure of what's included and the cost.
Check legal documentation carefully to see if they have any clauses or conditions that could affect your ability to become a member of the LLC. It is a good idea to seek legal advice at this point if you have not done so already.
4. Review the Contract
A purchase agreement can then be drawn up. Most business-for-sale agencies will have an established contract, but there may be caveats that could hold you back. It's a good idea to seek legal advice before signing a contract.
5. Registration & Introductions
Once you have purchased the LLC, you will need to notify all the relevant Government agencies, governing bodies, etc. of the change of ownership and register everything under your name. You will have a lot of administration at this early stage. You will want to notify suppliers of the change of ownership and possibly customers. Don’t forget to make sure you have transferred control of the website domain and social media accounts.
6. Start Running the Business
Now you can start running the business! Try not to make too many changes at once. Get to grips with the business as it currently runs, and then you can slowly start to make any changes and make it your own.
Final Word: How to Buy an LLC
You should now have some idea of how to buy an LLC if you want to own a business that is already well-established and successful. Ensure you research the company thoroughly, get evidence for their claims, and seek legal advice. Good luck with your new venture!