The most important allies in the purchase of a business can, and usually will be, your advisors. It is critical that you have picked experienced accountants, attorneys or brokers to represent you. Let’s focus on the accountant and attorney for the sake of this article.
The use of an experienced accountant or attorney is vital to the transaction. A good accountant or attorney can help you with the analysis of your business purchase and also with the tax implications as you move forward. When you are seeking either accounting or legal representation, make sure to find an advisor that is “transaction-based”. That means that the accountant or attorney is well versed in getting the transaction closed while offering you the necessary protection. It is not unusual for an attorney or accountant to look as though they are transaction-based but, in truth, they have little experience in completing business transactions. They could be very skilled at doing contract preparation or review. Others may be great at tax return preparation, but that does not make a transaction based advisor.
When you are interviewing your advisors, make sure to ask for a list of closed transactions to use as a barometer of their success. If they can’t provide you with a list of successfully closed transactions in which they represented the buyer, you should probably continue your search. And let’s remember one thing, your advisors are just that, advisors. Don’t look to them to make entrepreneurial decisions for you. You are the entrepreneur, so you should have the final say!