Some Important Questions to Ask Before You Buy a Business in Hong Kong
It doesn’t matter if you register a company or buy a business; Hong Kong has a favourable environment and all the necessary resources for your growth. Anyway, while purchasing a company, you should be sure that you are making a viable investment and not throwing your money down the drain.
Here are some of the most important questions to ask before you buy business in Hong Kong.
Questions to Ask the Seller
- What does the business do? What problem does it solve?
- What makes the business unique and better than the competitors?
- What is the best product or service that it sells?
- Why do you want to sell the business?
- How old is the business?
- How long have you been operating the company?
- What are the revenues and profits of the company in the past two years?
- Will the business selling process be confidential?
Questions to Ask the Customers
Of course, you can’t go around beating the drum telling everyone that you are going to buy a company. This can give out a negative message to the company’s existing customers and other connections like suppliers. Anyway, you need to directly or indirectly find the answers from the customers for these questions:
- How glad are the customers with the business’s present service?
- How likely are they to buy from the company in the coming days?
- Are there any chances of consumers transitioning to a competitive brand?
- If the people have a related problem, how likely are they to knock on the company’s doors before its competitors?
Questions to Ask About the Price of the Company
- What is the Marked Price? Is it negotiable?
- What assets and infrastructures are included in the price?
- Are there any liabilities? For example, an unpaid loan?
- Do they provide seller financing?
Questions You Will Need to Ask Yourself
These are the questions you will need to ask yourself before you buy a business:
- How much knowledge do I have in the domain? Do I have the interests and experience to scale the company?
- Why would I invest in this business only and not in similar firms of this type?
- Is this kind of business likely to sustain in the market for an extended period?
- I will be new to running this company. Will I be able to handle the competition with its current competitors?
Will I be able to afford this company? Also, do I have a backup plan if the investment fails?