Just joined, looking into purchasing an Office supplies business and wondering can i negotiate the SAV price even though the Xero accounting packaging might say value is $25,000?
Plus if there are any outstanding Credit ($8,000) can i take that off the asking price? Seems they will be leaving me with the debt?
Thanks in advance
This topic was modified 9 months ago by Stace2008.
Hi And Welcome to Flying Solo @stace2008 It is great to have you!
Thank you for joining our community and posting.
Negotiating a deal to buy a business is like any other deal but the best way to think of it is like the wild west – everything should be possible and on the table.
I personally would want to match the original invoices with the SAV numbers.
I want to check actual Bank Accounts against profit and loss data as well.
I personally would not be happy taking over the accounts receivable as the money is owed to the business entity not to the business name. Normally, you don’t buy the entity eg, the company or trust or partnership so technically, you might not be entitled to collect on previous or current debts to that entity.
You should talk to Business Brokers and Accountants before signing anything.
Thanks for the information.
What i meant was the money owed to other companies (Suppliers etc). The business we want to purchase owes other businesses $8000. Because its the current owners debt, can i take that off the asking price if she doesn’t pay for these invoices prior to purchase?
You shouldn’t take on the Seller’s debt. You should only pay for SAV that is fully owned by the business. One way of doing so is that the Seller shows proof that all stock is paid for by the completion (sale) date.
Normally a Business Broker will use a Standard Contract – the contract will have a number (a lot) of standard conditions that deal with these kinds of events.
So it is beneficial to ask the Seller to use a standard sale of business contract.