The Pros and Cons of Buying a Business Idea

Many people desire to own and run a business. But some people just don’t have the capital to purchase an existing business. Others aren’t great at coming up with ideas that could result in a successful business.

If this sounds like you, don’t worry — you’re not alone. There are other options for you where you can be your own boss and not have to shell out a significant chunk of up-front capital just to acquire the business.

One option would be to buy a business idea. This would give you the head-start that you’re looking for — and have trouble coming up with yourself — without spending as much money as it’d take to acquire a business that was already up and running.

When you buy a business idea, you should be looking for one that’s been fleshed out. The person you’re buying the idea from should have a blueprint for how the idea could be put into practice, with some market research that proves his or her claims.

Once you have vetted a few options, it’s time to decide if this would be a good avenue for you to pursue. To help you decide, here are some of the pros and cons of buying a business idea.

Pros

There are many advantages to buying a business idea. Here are three:

1. You don’t need to be creative

Creativity is key to coming up with an idea of any kind. In business, it’s actually a combination of artistic creativity and science. First, you have to devise an idea, and then you have to research and test it to find out if it’d actually work.

Not everyone has those skills, though, which is the advantage that buying someone else’s idea gives you. You don’t have to be creative in design at all, although there certainly will be some creativity needed in execution.

2. You can control the execution

When you buy a business idea, you’re only buying the idea itself. In most cases, the person you’re buying the idea from will have little to no involvement once the idea is sold. He or she may stay on to advise you as you’re starting the business, but the majority of work falls in your lap.

For many, this is a major pro. Those who aren’t adept at creativity are often very good at execution. Buying a business idea allows you to focus on just that aspect of the business, giving you the chance to shine.

3. You don’t have to fix mistakes

One of the biggest challenges to purchasing an existing business is that you often have to undo mistakes the previous owner made. Even if there aren’t technically mistakes, there are still plenty of things you’ll want to change to make the business run to your liking.

When you’re buying a business idea, you don’t have to worry about this at all. You get to build the business from the ground up. No one else’s hands will be on the actual execution of the business.

Cons

At the same time, there are some cons to buying a business as well. Here are three:

1. You have to do a lot of work

One of the pros of buying an idea is also a possible con. Because you’re purchasing just the idea, there’s a lot of work that you have to do to get the business off the ground.

Not only does this put a lot of pressure on you, but it also will require a lot of your attention. Even if the idea you purchase is fully fleshed out, this will still be much more similar to a startup business than a well-established operation.

2. You’ll need to establish the relationships

Relationships are key to succeeding in any industry of business. They also take a lot of time, dedication and effort to establish.

One of the great things about purchasing a business is many of the key relationships have already been culled. Key vendors, customers and business partners are already in place.

When you buy an idea instead of a business, you have to do all this work yourself. In other words, as you were putting in the time and work to get the operations running, you’d also need to establish these key relationships that would ensure your success.

3. The idea hasn’t proven to be successful

This is perhaps the biggest con to purchasing an idea. It’s a huge risk to start a business from the ground up, mainly because with a startup business, the idea hasn’t proven to be successful.

Again, when you buy an idea, you’re basically starting a business from the ground up. Sure, someone else has sketched out the idea and the potential path to success, but there’s no data to prove the idea’s efficacy.

Again, when you buy an idea, you’re basically starting a business from the ground up. Sure, someone else has sketched out the idea and the potential path to success, but there’s no data to prove the idea’s efficacy.

Don’t waste another day and talk to a Sunbelt South Florida broker today!
Sunbelt Business Brokers of West Palm Beach provides dedicated business brokerage services for all of your selling needs. Whether you are an established business owner nearing retirement and looking to sell, or an ambitious entrepreneur seeking your next investment opportunity, there is no reason to look beyond Sunbelt Business Brokers. Visit us at 800 Village Square Crossing
Suite 216 Palm Beach Gardens, FL 33410 or contact us at (561) 832-9222.