Buying an existing business good idea or not??

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I have some money from investments and thinking of buying an existing business maybe a vending route?? Is this a good idea rather than just doing what I am doing now -- sending out Resume after Resume, interview after interview , phone screens etc.. getting denied employment because my credit is bad or because I stumble on a question during the interview.

The trick is finding a business worth buying.

The only valid situation is where a business is profitable and the owner wants to retire without shutting down the business. These are difficult to find, and odds are there are buyers waiting in the wing to take over if the opportunity presents itself.

Then, there is the question of IF you would know how to run that business successfully. Most would not.

The only time I've seen it work, a man was hired to work at a gas station. The owner wanted out because he wanted to retire. Told the guy if he could come up with X dollars, he'd sign the business over to him. As the guy worked there for a while and knew everything about running the place, it was just a matter of getting the bank loan. It did well for a while, but he eventually sold it/shut it down.

In general, be very careful about doing this. The chances of you just stepping in and it being successful are very, very low.

I'd be tepid unless there was a clear reason that a good business was being given up, such as an elderly couple who have a successful restaurant but want to retire.

Keep in mind people shedding themselves of the burden of a business have a gift for polishing turds.

It probably depends on how much capital you need as to whether its worth the risk.

i will try to answer, but i am not tired enough to be succinct, so i will probably include irrelevant information.
these are the 3 main steps in my income history.

-------------------------step 1

i am a computer programmer, and i worked for many years in an office environment from 10am-4pm. i was the only software developer in the company i worked for.

the company i worked for had many clients, and i was responsible for writing systems that would handle their data and return it to them in the format they payed for (usually printed reports containing analyses and projections and suggestions of potential errors).

the company made a lot of money (approx 11 million per year (i also wrote the invoicing/accounts system)), and its* main competitor was a.c nielsen.

* "its" implies ownership, whereas "it's" means "it is" (in case someone thought i also refuse to use apostrophes).

government legislation was changed in a way that greatly favored nielsen, and the company i worked for had to relocate to the UK, and i refused to go there. i was paid very well for my services.

i was exceptionally worried that that i would not be able to get another job because the reason i had that job was that one of the managers was a tenant of one of my fathers units, and he got to know me, and even though i am obviously odd, he seemed very much convinced that my thought patterns were valid, and he suggested me when the job came up.

i did not think i would have that type of "extended interview by repeated exposure to me" ever again, but i was wrong.

one of "our" clients was dependent on me to personally provide them with their reports, because the computer operators in "our" company made many mistakes due to the complexity of that clients reporting requirements.

they asked me to continue doing what i do for them privately (my company let me keep that code for myself when they disbanded their australian presence (everything else i wrote for them was their property)).

-------------------------------step 2

i started working for the client that wanted me to work for them under contract, and i was payed similarly to my previous salary.
but it was very much a better situation for me. i designed how i could work from home, and they agreed (it was better for them too), and so i set it up and continued to provide an identical service to them as they had had previously.

i decided to entirely automate every action i had to manually perform, and after about 2 months, i had written a system that simply had a "run procedure" button, and a list box of time frames in which the current time frame was selected by default
once per month, they rang me and said "can we run the month end procedure now mark" ?, and i would say "yes" and invoke the system and click "run procedure", and that was generally all i had to do (it also automatically saved (via citrix interface) their reports and tables.

i became very lazy during the 7 years i worked from home. i stayed up until 7am, and i woke up at around 3pm.

then i was called in to a meeting, and to my surprise and horror, i was told that my services were no longer needed.

the company had been bought by an american consortium, and they had asked a company in india if they could replicate what i do, and they said "yes", and also that they could deliver the same service at a fraction of my cost.
i was again in a situation where i had no idea how i would get another job.

if people do not know me, then they can not trust that i will perform as they expect because they can not "work me out" (as they say), and in cold canvasing interview situations, i do not even warrant a second look to most people.

i had much money at that point, but to me, that was not satisfactory.
i knew that every time i looked at my bank balance online, i would feel uncomfortable that it would be always less than last time i checked since i was paying for my life with my savings.

so i thought i would look at buying a business. (essentially "buying a job")
i did look at it and i did buy one (and then more).

----------------------------------- step 3

after much review, i bought a "frozen potato chip (fry)" delivery run and also a refrigerated truck to do the deliveries with.
in australia, we have very many "fish and chip" shops. i think the U.K does too.
i bought the run which had 30 shops as my clients.

i was intrigued as to why the owner of the run (my current bulk supplier) would want to sell it considering it apparently made more than $500 per day in profit, and i did not trust the situation.

i was told that the reason he wanted to sell the run was.....

he has 25 runs, and he wants to move into bulk supply rather than attending to all the individual runs he has

there are about 30 shops in each of his runs, and 25*30=750 individual shops that he must ring to get their orders , and he must compile the invoices for all of them himself (he is a rather manual type of person).

he has realized that if he sells each of his runs, then the people who buy those runs will be dedicated to their success (because they have to pay $60,000 to buy it), and they will buy their stock from him.

if he merely employs drivers to drive his own trucks and if he pays them $180 per day, then they will not have no incentive to go out of their way to manage situations which may threaten the run because they have no investment in it. i could understand that logic, and i also watched first hand, the operation of the run for 3 weeks before i decided to buy it.

i did the runs myself when i first bought it. i continued for 18 months to deliver chips in my truck (it was very easy ( i was home by about 12.30pm)), but the thing i could never get used to was waking up so early (6am), and also i could not modify my behaviour the night before, so i could not ensure i was asleep before i had to get up.

then i decided to buy another run (that i had also watched carefully for weeks), and i hired a very good driver (i am lucky i found him. he loves physical exertion, and he wants to work 6 days per week (my 2 runs cover 6 days per week).

i pay him $230 per day ($1380 p.w (71760 p.a)), and i get an average of $650 per day profit, so after paying him to do the work, i still get approximately $420 per day.

so after paying him to do the labour, i make approx $2500 per week from the 2 runs ($120,000 investment)

everyone likes chips. they are very cheap and very tasty and very filling, and in times of financial crisis, sales actually rise.

never will there be a time that people will avoid eating chips ("fries") for any reason.
it is a very secure business, and i am going to buy 2 more runs after christmas that i am also watching.

i was also very lucky that i was able to obtain the products that fish and chip shops want at a price that is almost impossible to compete with (even after my 30% markup), so i have happy customers who get their stuff slightly cheaper than elsewhere, and i make 30% on all sales that day. i could only obtain that type of deal if i was buying a run from someone who very much wanted to supply me with the stock to supply the run they sold me at an extremely competitive rate.

i think i will accelerate this business exponentially, but part of me worries that if i tread on the wrong toes, i may have to worry about my safety.

even though i can see how i could "own " almost all of sydney's frozen chip deliveries eventually, the problems i may encounter that are of a nature that i can not predict (human disgruntlement) make me decide that 6 runs will be enough for me.

i do nothing but ring shops and obtain their orders, and i enter them into the system i wrote for that purpose,
and everything is calculated and faxed automatically to the depot and also the driver for that run.

what you have to do is analyze is how much people want a product, and if they want it, and you can source it, you then analyze how demand maybe affected by the variations in general economic climates.

i can see that chips (or thick french fries) will always be tempting to people's appetites.

in times of plenty when everyone is well off, they will still eat chips. they will eat them because they like the taste of them

in times of hardship, chips are even more attractive, because they taste so good, and they provide much energy for such a little price.


i would not buy a cafe or restaurant. you would be bound to it's execution for many hours per day.
i think those types of businesses are not very secure (unless they are worked on with extreme determination that is unnecessary in my opinion to spend perpetually to live).

_______prologue

anyway, the company in india that tried to replicate my system did not achieve a satisfactory result, and i was asked to resume my stewardship of their data, so in addition to all those calls i have to make every month, i also have to press a button.

just look carefully at where you are wondering where you should tread.

god i am sorry for the length of this reply.
you can punish me by not replying.

So I guess I am screwed and have exactly zero options. In three and a half years I will be homeless since NO ONE will hire me and even if I do manage to get a temp job, I lose it after the 2nd or 3rd day due to some vague reason such as 'I didn't "pick up" the work quickly enough, or 'I asked too many questions, or the department decided they would absorb the work amongst themselves...

The above is likely due to a combination of anxiety, poor social IQ, and a possible learning disability. I find I always feel on edge at every job like I am always 1 moment away from being fired

I thought that by starting or buying a business would be better than sending out Resume after Resume, interview after interview and not getting hired.

This.

Most businesses for sale are being sold because they're not profitable enough or have staffing problems.

If the person is retiring or has a good reason, and has proven profitable reports, maybe.

Rare, but slightly possible. You'll need to do tons of research before hand.