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Buying a Business Montana

Buying a Business Montana

buying a business MontanaIf you are interested in buying a business in Montana, it is important to seek experienced legal counsel as early in the purchasing process as possible. Buying a business is a massive commitment and requires you to assume a great deal of risk – whether you’re taking over a small operation or acquiring a thriving company. The reputable legal team at Silverman Law Office, PLLC has extensive experience in assisting small business owners, non-profit managers, and large corporations safeguard their legal interests. Regardless of your company’s size, the nature of your industry, or your professional goals, our knowledgeable legal team can help to ensure that the process of buying a business is conducted in a way that protects your rights, fosters your interests, and minimizes your risk of legal liability.

Buying a Business – Montana

The process of buying a business in Montana can be far more complex upon execution than it seems to be in concept. On paper, it seems that the process of buying a business simply consists of securing financing and signing some contracts. However, the legal intricacies of this process can prove to be overwhelming for those who attempt to resolve this process on their own. Thankfully, our team is here to take a significant fraction of the stress-related burdens tied to this process off of your shoulders.

Considerations Prior to Buying a Business

Prior to your consultation with Silverman Law Office, PLLC, spend some time gathering basic information that will help us to objectively assess your legal needs at this time. Have you already identified the business that you are seeking to purchase or are you just entering this market? Have you clearly defined your budget, goals, and resources available for this process – and if so, what are they? Have you already engaged in any due diligence concerning the state of any businesses in which you are interested in purchasing?

Once we have a better understanding of where you are in this process, we can create a comprehensive strategy designed to meet your legal and practical needs. From securing permits and licenses to researching the debts tied to any businesses that interest you, we can assist you with every step of the business purchasing process.

Legal Assistance Is Available

If you have not yet scheduled a risk-free consultation with the experienced legal team at Silverman Law Office, PLLC, please do so now. Connecting with our firm doesn’t obligate you to work with us in the future, nor does it obligate you to take any action whatsoever. The risk-free consultation process simply allows prospective clients to ask questions, have their concerns addressed, and to learn more about our approach to representation.

Buying a business is a significant investment of your resources, attention, and hope. Please allow our dedicated legal team to provide you with more information about the nuances associated with buying a business in Montana; we look forward to speaking with you.

A Few Things to Know When Buying a Business

Buying a business can be an exciting venture. Still, there are a lot of areas to cover when taking over the proprietorship of one that’s already established. If you’re buying a business in Montana, there are a few things you should be aware of when you take ownership.  

Taxes

In some cases, when you’re buying a business in Montana, the previous owner of a company might still owe taxes. If that’s the case, the tax authority could come after you once the business is in your name. Taxes owed could include payroll, sales, and other business taxes.

Be sure to get a clearance letter from the state tax authority stating that the owner is up to date. If you’re unsure how to get one, the experienced lawyers at Silverman Law Office, PLLC, can help.

Debts

When considering purchasing a business, you should ask the current proprietor whether any customers still owe money. If there are, you can either take those debts on or allow the previous owner to accept them in whichever way they prefer. However, taking on any active accounts yourself might prove beneficial if you’re hoping to be rehired by the same clients. 

If you take over indebted accounts, be sure to get a written record that the previous owner won’t send any further invoices to the clients in the future. This will help prevent double payments.

Prepaid Expenses

Many businesses will prepay for things such as marketing or other services for months or even years in advance. For example, a restaurant might have a billboard advertisement paid for six months. If that’s the case, the seller of the business might want reimbursement or compensation. 

Any reimbursement or compensation terms should be put in writing. Then, to make sure you cover all of your bases, reach out to a lawyer at Silverman Law Office, PLLC, to get assistance.

Staff

If you’re buying a business in Montana, you’ll likely be taking on some of the existing employees, as well. If you plan to keep them on board, take some time to get to know who they are. It can be wise to determine which employees understand the business best and do what you can to keep them working for you.

There are a lot of things to cover when purchasing a business. However, the experienced staff at Silverman Law Office, PLLC, are eager to help make your transition to a business owner a success.

Buying a Business in Montana

If you are thinking about buying a business in Montana, you will certainly have a lot on your plate. Purchasing an existing business can be quite complex. However, if you take all the necessary steps, it can be worthwhile.

Benefits of Buying an Existing Business

Many people choose to buy an existing business instead of building one from scratch. Here are some benefits of purchasing a business:

  • Reduce startup time. Building a business from the ground up takes a lot of time. From purchasing inventory to hiring employees, there are countless tasks to complete. However, if you buy an existing business, you won’t have to worry about all of these tasks. The previous owner will have completed the majority of these things for you.
  • People already know about the brand. One of the most difficult aspects of starting a business from scratch is attracting a customer base. It takes a considerable amount of work to market your product or service and stand out from the competition. That is another good reason to buy an existing business. People will already know about the brand, so you will spend less time and money on marketing.
  • Easier to obtain business financing. Most people need to secure a loan to buy a business. However, getting approved for capital for a startup is not so easy. Lenders want to make sure that there is not much risk and that they will get their money back. It is actually easier to secure financing to buy an existing business. If lenders see that the business has made good profits in the past, they may be more likely to approve you for financing.

Why You Should Hire a Business Attorney When Buying a Business

Perform Due Diligence

As with any major purchase, your first task when you consider buying a business in Montana is doing your due diligence. A business attorney, such as those at the Silverman Law Office, can help you determine what paperwork you need to fully explore the company’s financial health and viability. These professionals can guide you through the business valuation process, including an in-depth review of the financial ratios and future prospective cash flows.

However, financial matters are not the only thing to consider during a business purchase. You also need to look at the organizational structure, human assets, technology and other assets. Each of these has a value that needs to be assessed.

Contract Reviews

Every business has multiple contracts with its suppliers, customers, employees and stockholders. All of these agreements need to be analyzed before buying a business in Montana. If you find unfavorable contracts, your attorney can try to negotiate better terms. You may also want to pursue new suppliers or partnerships, so you need to know if any of the company’s existing contracts prevent you from doing this.

You will have new contracts that you have to draft as well. However, a great business lawyer will help you draft, edit and negotiate any new contracts.

Document Filing

Business law firms, including the Silverman Law Office, will help you fill out all your business paperwork. For example, you need to contact Montana officials, including the Secretary of State’s office and any office of professional licenses that apply to the company, before buying a business in Montana. Each state agency will have different document requirements. In addition, various state agencies require disclosure paperwork or pre-sale documents from sellers to prevent fraud and increase transaction transparency.

Structure the Deal

You are probably buying a business in Montana for a specific purpose, whether that is gaining key employees or technology, eliminating competition or expanding a product line. Your deal structure will be based on your acquisition goals.

Contract Creation

Your attorney will also help you create your business contracts, starting with your letter of intent. The structure of this letter will determine whether you are bound to purchase the company or not. In addition, as your purchase continues, your lawyer will negotiate your buyer contract terms. These professionals determine the sellers’ desires and ensure that the business is transferred in the condition you desire. For example, they cannot take key employees or technology with them and everything has to be in working order. You may even include a non-compete clause.

Questions to Ask Before Buying an Existing Business

Buying a business in Montana is a big investment. That is why you should ask the necessary questions before making a purchase. Here are several questions you may want to ask.

  • Why are you selling the business?
  • Does the business have outstanding debts?
  • What is the financial status of the business?
  • How do you market the business?
  • Does the business own intellectual property?
  • Are there any pending lawsuits against the business?
  • What contracts does the business have right now?
  • Has the business changed at all since being founded?

If you are considering buying a business, you should obtain advice from a skilled business lawyer in Montana.

Mistakes to Avoid When Buying a Business

Buying a business can be a great investment. However, it can involve a lot of complexities, so it’s important to follow the proper steps. Here are some common mistakes to avoid when buying a business in Montana.

  • Neglecting to find out why the business is for sale. Before you decide to buy a business, you should find out why it’s for sale in the first place. Doing so can help you prevent potential complications down the road. For example, if an owner is filing for personal bankruptcy and needs cash from the business, you may be able to negotiate a lower price on the business.
  • Thinking that everything will stay the same. Too many people assume that the business they purchase will be the same business they saw before they bought it. This might not be the case. Since the business is under new ownership now, the relationships with customers, employees and vendors may be different. The business could get better or it could get worse.
  • Purchasing a business you can’t afford. If you think you have found a business that suits your skills and interests perfectly, it is easy to get excited. You might even be willing to pay anything for it. This is a big mistake. You should never buy a business that you can’t afford. Instead of getting into deep debt, wait until you have sufficient funds to buy the business.
  • Signing contracts in your own name. When you purchase a business, you will have to sign multiple documents. A mistake some people make is signing these documents in their own name. However, if you do this, you will unnecessarily take on personal liability. Instead, sign these documents with your business name.
  • Making changes immediately. Taking over a business can be exciting, and you may be eager to make changes quickly. However, making changes too quickly can backfire. If the changes you make aren’t popular, employees may quit and customers may go somewhere else. It’s a wiser move to get a feel for the place first and make changes more gradually.
  • Attempting to do it yourself. Buying a business is a huge venture, and you shouldn’t attempt to do it on your own. Hire a skilled lawyer who can review contracts and make sure that you are getting the best deal.

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