What is the difference between purchasing a business Freehold or Leasehold?
In effect, if you purchase the Freehold Fixtures & Fittings and Goodwill you will own the property as well as the business. If you purchase Leasehold you will own the business and fixtures and fittings and the right, usually for a given period, to occupy the business premises for an agreed rent.
What does SAV mean?
SAV means Stock at Valuation. Most businesses sell a product and to enable their customers to have a choice they hold a certain amount of stock. When you buy a business this stock is not usually included in the asking price for the business. For example, a ladies or gents clothing outlet will have a certain amount of stock which includes what is on display and what is in the store room. When you buy the business you may need the stock to carry on trading while you introduce your own lines. So the value (cost price) of the stock is calculated and paid for when you take over the business.
What are A1, A2, A3, A4 and A5?
Local authorities grant 'permitted use' designations to premises in their area; these are the most usual categories.
A1Retail uses - A2Professional and Financial Services - A3Hot Food Restaurants - A4Licensed Premises - A5Takeaway.
What is gross profit and net profit?
Gross Profit is the profit after the stock has been paid for - takings less purchases. Net Profit is the profit after all other expenditure has been deducted and is the money the business has made for the financial year.
I've found the business I want to buy but my bank has turned me down for a loan. What can I do?
We are able to assist buyers with finance; our lenders can often put together a financial package when other lenders (high street banks, building societies etc) fail. If you are looking to buy a business, leasehold or freehold and your credit rating is less than perfect or you have been turned down elsewhere then contact our offices. In most circumstances we will be able to help.
Is your service free to Buyers?
Yes, our service is free. We are happy to offer Buyers professional advice on many aspects of buying a business; from helping to identify the business that is right for you, explaining the various methods of financing your investment, choosing a solicitor or simply explaining the transaction process through to completion in an easy-to-understand and "jargon-free" manner.
I've not bought a business before. How long does it take?
The transaction starts with arranging an appointment with us to view your chosen business. Once you have met the Owners, we will provide you with the latest profit and loss account information on which you can base your offer. Once your offer has been accepted, you should allow 6 to 8 weeks for both sides' solicitors to agree the draft Sale and Purchase contract details. Once both sides are in agreement an Exchange of Contracts can take place. During this period, buyers generally sort out their funding requirements. If it is a leasehold business, this period is also used to gather references for the Landlord. Once the Landlord is satisfied, a licence to assign the existing lease is granted and the transaction can then move to an Exchange of Contracts and Completion.