Choosing A Business


Many of the listings I come across do not include the business’s revenue or cash flow. How can I possibly be interested in a business without at least having some sense of these numbers?


This is an excellent question. There’s no doubt that it would be difficult to formulate any kind of meaningful impression or assessment of a business without certain key financial information – especially basic information like revenue or profitability.

That being said, keep in mind that your agenda when looking at business for sale listings should be first and foremost to determine if the business model/type is of interest to you.

Naturally the financial ratios are key; however, these can easily and quickly be disseminated to you by the seller/broker once you contact them and express interest.

I have seen countless online business for sale listings and certainly the majority do include the key financial data (although still to be proven). In some cases though, especially in larger business, these details may be omitted initially due to confidentiality concerns.

Here is my suggestion: when you come across a business listing that is of interest to you, even if there is some missing information, go ahead and contact the seller/broker.

Before you get busy requesting detailed financials you should simply note that you’re interested in the business, and you’d like to sign the necessary confidentiality agreements. Once those are in place, you can then delve into the financial information you will need to further evaluate the business.


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