The world is full of statistics. One data point says 40% of new businesses fail in the first year and 80% in five years. Does this surprise you?

Whether it does or does not, this data point tells you that the chances of your success would rise if you choose to buy a ready, established and running business for sale rather than starting out from scratch.

Take the case of Dubai, for instance. Dubai is a mega city with a few hundreds of thousands of successful retail businesses. Businesses that their owners have built over years of hard work and capital risk.

Buying a ready business for sale helps you take over an operation which has an existing customer base, trained staff, market reputation and robust cash flows. You hit the ground running. Surely, starting from scratch does have a few benefits but you would not have a ready set of customers to serve, a well-trained bunch of employees and a tested formula to climb up the ladder of business success.

Purchasing a ready business starts with understanding your own area of interest and the industry you have knowledge about. Nothing better than choosing something which matches your skills and experience.

If you are wanting to start out from scratch, you might not find a location that’s best for your kind of business. There in fact might be someone already doing your kind of business in that neighborhood. What great business sense would it be for you to locate your flower shop next to a florist in the same neighborhood?

If you are not a drive-through business, finding a location next to a parking space is important. What use is a restaurant of if you cannot find parking space nearby? This becomes even more important during summers or rush hours. The ready availability of transportation for your employees as well as customers helps. Competition in the local neighborhood may be a factor to consider. Speak with someone who knows not only what exists in the area, but also what is scheduled to come up.

Capital is key to any business. Persuading financial institutions to invest or fund loans on new ideas or propositions could be challenging. Dubai and UAE based banks, much like their peers elsewhere, have business cycles of credit expansion or reduction. In the current low commodity price environment, many banks are averse to taking credit risk with small and medium sized businesses. Your chances of securing a business loan are higher when you are a well-established business with existing brand value and certain cash flows.

Buying a ready business helps you ascertain all these factors before you buy it. It removes the uncertainties associated with starting out from scratch, injecting capital, building a brand and then waiting for customers to walk in.

So, if you are considering the purchase of a ready business for sale, where do you start? Local newspapers in the UAE such as Gulf News and The National are a great resource to find a ready businesses for sale. Be careful though. You do not buy businesses on a daily basis. You might not have the expertise to acquire a business. Ask yourself, what could be the reasons for this business to be for sale. Business sellers might not disclose sensitive issues associated with the business. Take the help of professional advisers. Ask them to investigate the legal status of the business. Check out the trade license issued either by the Department of Economic Development of Dubai, Abu Dhabi or the emirate it is located in. Check with the concerned free zone authority if the business is located in one of the several free zones in the UAE. Click here for a list of the free zones in the UAE. Ask a law firm to handle legal aspects of the transaction. Ascertain that all issues of regulatory importance have been fulfilled. Let your professional adviser do the job. If you navigate the process of buying a business for sale well, you will gain advantages that you would not with a fresh, new business

1. Avoid the risky start-up stage:

Very few startups survive to make profits. Eliminating the whole start-up phase helps you focus more on expansion of the business than laying the foundation.

2. Skilled staff and trained managers:

You can save your time, money and energy by gaining access to skilled staff. Trained managers help you with service and advice which could be very valuable. They are the people who deal with customers or production day in and out and could help you with ways to improve the business.

3. Easy availability of finance:

Since an existing business have a track record to refer to, getting access to finance or business loans could be easier. This would be the case especially if you continue the existing banking facilities of the business you have purchased.

4. Leverage on brand value:

Save the marketing dollar. As the existing business will already have brand value and would be well knows by customers, you can save some money on its branding and in creating customers.

5. Market reputation:

The business you acquire would have existing relationship with clients and customers who would contact you when they need to engage with you or procure your products and services. They will come to you based on their previous experiences without you have to hire new people to reach out to every potential client in town.

While there is no denying that that there are advantages to starting out fresh, the ability to hit the ground running with existing customer bases and existing cash flows outweigh many of those.

What have I missed? Do you have any comment or feedback?