Buy or Start A Business - Small Town Entrepreneurs

Too often I see entrepreneurs get wrapped up in the excitement of starting their own business. It’s fun to create something from nothing and watch our idea come to life. Something that has to be considered though is the viability and profitability of the business opportunity, especially when located in a small town or rural community. Below I’ll discuss a few points to take into consideration when exploring the option to purchase an existing business instead of starting from zero.

1. Established Customer Base: In small communities, trust and familiarity are vital. When you buy an existing business, you inherit a customer base that has already formed a relationship with the brand. This is invaluable because acquiring new customers can be costlier and more challenging than retaining existing ones. Moreover, in a smaller community, a loyal customer base can also act as brand ambassadors, spreading word-of-mouth recommendations that are far more effective than traditional advertising in such settings.

2. Proven Business Model: A proven business model offers a blueprint for success. It's like having a map in uncharted territory. You can analyze historical data, understand seasonal trends, and get insights into what products or services are the most profitable. This knowledge is particularly beneficial in rural markets, where data might not be as readily available or comprehensive as in urban areas. You can focus on scaling and refining the business rather than figuring out the basics.

3. Established Brand and Relationships: In smaller towns, a business isn't just a commercial entity; it's a part of the community's fabric. An established brand can have a legacy and emotional connection with the community, which is a powerful asset. Additionally, long-standing relationships with suppliers and local partners can mean better deals, credit terms, and reliability - crucial elements in areas where options might be limited.

4. Immediate Cash Flow: The financial aspect cannot be overstated. Cash flow is the lifeblood of any business, and it's often in short supply during the early stages of a startup. When you acquire a business, you're also acquiring its revenue stream. This can help keep the business afloat as you make your transition into ownership and plan for growth, which is particularly crucial if you're operating with limited capital reserves, as is often the case in rural entrepreneurship.

5. Less Risky: Every new business is a gamble, but an existing business comes with a track record. You have a clearer picture of what to expect, which allows for more accurate planning and forecasting. In rural economies, where market fluctuations can have a more pronounced impact due to the smaller size of the market, reducing risk is a significant advantage.

6. Employee Experience: Experienced employees are invaluable. They understand the nuances of the business and the local market. They can provide insights into customer preferences and behaviors that are specific to the community. In rural areas, where the talent pool might be smaller, having a team that's already trained and knowledgeable can save significant time and resources.

While buying an existing business can offer a head start in many ways, it's important to approach this opportunity with due diligence. Understand the business's financial health, its standing in the community, and its growth potential. Look at its digital presence as well – in today's world, even rural businesses benefit greatly from effective digital marketing strategies. Remember, the goal isn't just to buy a business but to grow it and make it your own. With the right approach, buying an existing business in a rural or small-town setting can be a rewarding and profitable venture.