Starting Versus Buying a Business, Entrepreneurship Mr. Bernstein Starting Versus Buying a Business, pp 57-62 September 2017

Entrepreneurship Mr. Bernstein Entering the Family Business Only 33% survive to a second generation Trust and togetherness (“chemistry”) can be a great asset Clear lines of responsibility are needed Consider potential areas of conflict

Entrepreneurship Mr. Bernstein Buying a Franchise Venn Diagram: Franchisee Franchisor The Franchisor controls business practices, provides planning and management expertise, training, and product and name recognition The Franchisee avoids most startup costs and uncertainties The Franchisee pays an upfront fee and ongoing royalties, or percent of revenue

Entrepreneurship Mr. Bernstein Buying an Existing Business Goodwill – loyalty of existing customer base Owner participation in transition period Inventory Plant and Equipment Credit Arrangements Trained Employees Innovation usually comes from within an industry Business Brokers facilitate buying and selling of small businesses