This is the classic ‘buy’ versus ”build’ question.
A start-up requires months if not years of losses to reach break even. This is money that could be used as a down payment on a business that will generate positive cash flow day ONE even after all debt service.
An existing business has a track record. The failure rate in small business is largely in the start-up phase and concentrated .
An existing business has established employee, client and vendor relationships.
An existing business has demonstrated that there is a need for that product or service in a particular locale.
Financial records are available along with other information on the business to make borrowing and establishment of credit facilities easier.
Most sellers also include transition assistance at no additional cost to train a new owner.
