your business plan requires the acquisition of a building

How to Put Together a Business Plan for an Acquisition

Kison Patel is the Founder and CEO of DealRoom, a Chicago-based diligence management software that uses Agile principles to innovate and modernize the finance industry. As a former M&A advisor with over a decade of experience, Kison developed DealRoom after seeing first hand a number of deep-seated, industry-wide structural issues and inefficiencies.

What is Acquisition Planning?

Acquisition planning is when the acquirer identifies and builds relationships with potential targets. More specifically, these targets meet the acquirer’s predetermined, strategic criteria.

‍ The strategy behind acquisition planning leads to stronger outcomes for both sides of the deal and must, therefore, be the foundation of acquisition plans.

Acquisition plan templates often include a summary of this overarching strategy, criteria for potential targets, a list of potential targets, timelines, risk management and due diligence materials, as well as integration planning materials.

We at DealRoom work with many companies helping them organize their M&A process . So let's start with the overview.

How to create an acquisition plan

One of the principal errors that many M&A practitioners make before making an acquisition is not putting together a business plan. The business plan is an invaluable asset when planning M&A.

It creates a roadmap for what you’re looking for from a business acquisition, as well as providing reassurance to those funding the deal that the rationale behind it is solid and that the decision to acquire is not being made on a whim.

The format of the business plan for an acquisition has a similar structure to that of a business plan for a startup and includes many of the same sections.

When writing either of these documents, you should be asking yourself ‘does what I’m writing sell the opportunity?’

If the answer to that question is ‘ no ,’ you need a rethink, maybe not just for the document, but perhaps for the acquisition itself.

Having said all that, here’s a typical outline of how a business plan for an acquisition should look:

1. Executive Summary

Even though it comes at the beginning, most how-to guides on business acquisition plans suggest leaving the summary of an acquisition transaction until you’ve written everything else.

While this is pretty sound advice, a good rule of thumb is that, if what you’re proposing is compelling enough, you should have a rough draft of the executive summary in mind before even beginning.

A good executive summary should cover a page and sell the opportunity as best as possible, covering its target market, your strategy and summary financials. This is often the only page that investors read before skipping to the financial projections, so make sure it’s strong.

2. Target Description

This section of acquisition plan outlines the business you’re acquiring and why it’s worth what you’re proposing to pay for it. Be as thorough as possible here. If there are weaknesses that you see in the business, introduce them and talk about how you can iron them out and generate value.

At a minimum, include details such as

• headline financials
• a breakdown of the company’s long-term assets (factory, head office, facilities, stores, etc.) and liabilities
• a SWOT analysis
• corporate structure.

If the company operates in a different segment to your own, show how you can make this work in your favor.

3. Market Overview

A common error when looking at the market overview is to think globally.

Startup investor Peter Thiel refers to this, whimsically noting that someone owning a restaurant could say that they’re entering a trillion dollar industry, when in reality, their market is a five mile radius around the location of the restaurant.

The more granular the detail here, the better.

• How many customers does the target have, and what kind of customers are they?
• Will you lose their business if the current owner moves on?
• What kind of demand is there for the business outside of its current customer base?

4. Sales and Marketing

This section provides an overview of the sales for each of the target’s products and services. It should show their pricing strategy and how it compares to your own, and how the company currently conducts its marketing.

For example, if it uses mailing lists to contact customers, is that something you could leverage for your own products and services?

Or perhaps you feel it’s not investing enough in marketing and that you could increase sales by investing in this area. In either case, outline the ‘quick wins’ that you can exploit here after acquiring the business.

5. Financial History and Projections

When looking for financing for an acquisition, this section is the one which will make or break the deal. Thus, you should be as thorough as possible here, analyzing the target’s past financial performance.

At a minimum, this should involve three years of financial statements and tax returns but five or more is even better.

The analysis should be comprehensive and honest. It should raise issues that may conflict with your own business - for example, different credit arrangements with customers or a significant difference in capital structure.

Once this has been completed, you can look at projections for the business. These projections should tie in everything you’ve written until now; if you plan to increase sales and marketing, this should show in the income statement; if you’re going to use income from the acquired business to pay down debt, this also needs to be accounted for.

There is no right answer for how much your growth projections should be, but it should be justified by the vision that you’ve laid out until now.

An interesting, if potentially complex, sub-section to add to the financial analysis are the gains from synergies and losses from cannibalism that you see emerging from the deal.

Synergies might come from cutting some admin or sales staff or merging sales channels (for example, online or direct mail) after the acquisition.

Cannibalism arises when you’ve got one of your sales reps selling the new, wider product range, and the customer ends up choosing the target’s product over your own.

It’s easy to fall into the proverbial rabbit hole with this section, but it’s still a useful exercise to make you think about where gains (and losses) will be made from the acquisition.

6. Transition Plan

This is typically a brief section that shows how the business will move from the control of the current owners to your own. This is not purely about ownership, however.

It should also detail how current sales relationships, contracts, and intellectual property are dealt with in the transition.

You can minimize the disruptive influence of the acquisition by getting this section right. If there are complex processes at the target company, know who performs them and how this will be dealt with.

Thousands of acquisitions are botched every year by undervaluing seemingly small processes which generate value right across the business.

7. Deal Structure

The topic of deal structure has been covered well elsewhere [link], and these articles can be of assistance when adding this section.

Having put together a failsafe case for acquiring the target company, now you show the financial structure you will use to do so.  

8. Appendices/Supporting Documents

A major difference between writing a business plan for a startup and one for a business acquisition is the variety of supporting documents attached.

At a minimum, this should include copies of tax returns and licenses, but could go into greater depth and show contracts with large customers, auditors’ letters and any other legal documents deemed relevant.

Using a merger and acquisition proposal sample can provide helpful guidance when determining which supporting documents to include.

Download acquisition plan/proposal templates

• Business acquisition proposal sample template
• Acquisition strategy sample template (m&a strategy template)
• Business acquisition plan template

While there is room for some variation in sections of each business plan, one thing every plan should have in common is its ability to convince the reader of the merits of the acquisition. Each section should be detailed and compelling.

If you’re not willing to put in the groundwork on a business plan, an investor is entitled to ask, ‘ why should I give a million dollars to someone who can’t write 20 pages? ’

By spending time on the business plan, and taking a critical perspective, you maximize the chances of your acquisition finding a funder, and simultaneously creating a strategy for the acquisition that primes it for success.

Free Template: Business Acquisition Plan

Download the exact plan dealmakers use to ensure important acquisition planning criteria aren't overlooked

Still unsure where to start?

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How To Write an Acquisition Business Plan

In the world of business, acquiring another company is a bold move. It’s a venture filled with both opportunities and risks. To navigate this complex journey successfully, you need a well-structured acquisition business plan. This isn’t just any document; it’s your guiding star, your blueprint, and your key to making this business acquisition a triumphant success.

Acquiring a business is no small feat. It’s a defining moment in the life of any company, and the acquisition business plan is the compass that will lead you through this challenging journey. In this guide, we will not only emphasize the significance of having a comprehensive plan but also provide you with an in-depth understanding of the critical elements that should be present in your plan.

What is Acquisition Planning?

How to create an acquisition business plan step by step, start with an executive summary, get to know your company, understand the industry, evaluate the target business, lay out your acquisition strategy, your marketing and sales game plan, crunch the numbers, deal with potential risks, navigate legal and regulatory matters, meet the team, merger and acquisition business plan template, optimizing a business acquisition plan with structured processes, making it work together, sharing the secrets, one size fits all, more bang for your buck, what makes you special, the big picture.

Acquisition planning is a structured process for identifying and acquiring goods or services to meet an organization’s needs. It is a critical part of the procurement process, as it helps to ensure that the organization gets the best value for its money.

Need a Professional business plan writer?

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The executive summary is like the opening scene of a blockbuster movie – it sets the tone and captures the audience’s attention. It’s a concise yet impactful overview of your acquisition strategy. This section serves as the very first impression potential investors and partners will have of your plan.

In your executive summary, include key highlights such as the purpose of the acquisition, the target business, and the expected benefits. Remember, it should be captivating, informative, and compelling.

In the ‘Get to Know Your Company’ section, you provide an extensive profile of your own organization. This is your opportunity to showcase your strengths, experience, and financial stability. It’s essentially the part where you introduce yourself before a crucial presentation.

Outline your company’s history, achievements, and expertise. Explain why your company is the right entity for this acquisition. Make sure to instill confidence in the minds of your readers and potential stakeholders.

An acquisition is not just about buying another company; it’s about entering a new landscape. Understanding the industry in which your target business operates is crucial.

Here, you need to delve deep into the industry. Share insights about market trends, potential for growth, and any challenges that might be on the horizon. This section serves as evidence that you’ve done your homework and are prepared for what lies ahead.

Let’s talk about the business you plan to acquire. In this part of your business plan , it’s your chance to discuss the target business in detail. This includes its history, financial performance, and the assets it brings to the table.

Highlight the aspects of the target business that are promising, and also acknowledge where improvements can be made. This demonstrates your realistic approach and your clear vision for the future.

This is where you outline your plan for acquiring the target business. Your strategy should include the deal structure, financing details, and a clear timeline. Explain how you intend to integrate the newly acquired business into your existing operations seamlessly.

In this section, it’s essential to exhibit your strategic thinking and your ability to execute the acquisition effectively.

Once the acquisition is complete, what’s your strategy for marketing and selling? How will you use this new addition to your portfolio to grow your customer base and, consequently, your revenue?

This part of your plan should outline your marketing and sales strategies post-acquisition. It’s the place to showcase your vision for the future and your ability to drive results.

This is where the hard numbers come into play. Provide detailed financial projections, including income statements, balance sheets, and cash flow forecasts. These projections should offer a clear picture of the expected financial benefits of the acquisition.

These figures are not just dry statistics; they are the financial backbone of your plan, demonstrating the potential return on investment.

Every business venture comes with its share of risks. In this section, you should identify potential risks associated with the acquisition and explain how you plan to address them.

This shows your meticulousness and your commitment to risk mitigation, which is crucial for building trust and confidence among your stakeholders.

Acquisitions often involve complex legal and regulatory matters. It’s essential to discuss these aspects in your plan. If there are compliance issues, explain in detail how you intend to address them.

This section assures your readers that you’re well-prepared to navigate the legal intricacies involved in the acquisition.

A successful acquisition is a team effort. Introduce the key players involved in the acquisition and explain their roles. Highlight their experience, qualifications, and achievements.

By showcasing the strength of your team, you demonstrate that you have the right people in place to execute the plan effectively.

Get specialized business plan services now!

Grab our Merger and Acquisition Business Plan Template to make your merger or acquisition journey smoother. This template is packed with key sections and detailed insights, ensuring you cover all aspects of your acquisition strategy. Let this template be your roadmap as you navigate the complexities of business acquisitions. Start your journey toward a triumphant merger or acquisition business plan today! Download M&A Business Plan Template

Crafting a business acquisition plan isn’t just about signing papers; it’s about blending smart strategies that supercharge success. By weaving organized methods into this plan, you’re making sure that the merging companies don’t just coexist but flourish together.

Think of it as putting puzzle pieces together. Show how a carefully planned approach isn’t just about buying a company; it’s about merging their ways of doing things into a cohesive strategy. This part is about combining different systems, rules, and methods smoothly.

Talk about finding and using the best ways of doing things from the company you’re acquiring. Explain how mixing their successful methods with yours makes everything run smoother and more efficiently.

Show why having a set way of doing things helps. Discuss how having consistent methods, from handling money to everyday tasks, helps the new company grow without unnecessary overlaps.

Explain how having a well-thought-out plan gets you more than just a new company—it increases your profits too. Highlight how bringing in smart strategies boosts how well the business works and makes it stronger.

Talk about the advantage you have—the ability to look at different ways companies work. Explain how this helps you find and use the best ideas, making all your businesses better.

Wrap it up by saying this plan isn’t just a bunch of papers—it’s a map to a successful future. It brings together the best parts of different companies, wipes out any problems, and sends everyone toward success.

In the concluding section of your plan, summarize the key points. Emphasize the potential for success that your acquisition business plan represents. Leave your readers with confidence in your approach and a sense of optimism about the future.

In conclusion, an acquisition business plan is more than just a document; it’s the heart and soul of your acquisition strategy. A meticulously crafted plan, like the one described here, can be your key to not only a successful acquisition but also a confident and prosperous future in the complex world of business acquisitions.

By following these steps and adding depth to each section of your plan, you can create a compelling narrative that instills trust and confidence in your stakeholders. This detailed roadmap will position you to excel in the intricate and rewarding realm of business acquisitions.

What is acquisition in business strategy?

An acquisition is a business deal where one company acquires and assumes control of another company. These transactions are a fundamental component of mergers and acquisitions (M&A), which represents a professional field in corporate law and finance centered on the acquisition, sale, and merging of businesses.

What is acquisition in business example?

An acquisition is a business deal in which one company obtains companies, organizations, or their assets in exchange for some form of consideration from another company. Examples of such transactions include Google’s purchase of Android for $50 million in 2005 and Pfizer’s acquisition of Warner-Lambert for $90 billion in 2000.

How do I prepare my business for acquisition?

• Perform an internal audit.
• Establish a well-organized company structure.
• Tidy up your financial statements.
• Renew your most crucial contracts.
• Create a strategic plan for the next five years.
• Address any pending legal and tax matters.
• Optimize your business operations.
• Ensure you have a top-notch team in position.

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How to Write a Business Plan Outline

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Many considerations come with a business acquisition. Not only do you have to consider the cost of the purchase, you have to consider how your business will integrate the newly purchased assets and utilize, or relieve, the employees that come along with the business. The business plan takes these and other acquisition considerations, along with their pros and cons, and organizes them into reusable research and analysis.

Create the business description for your business plan. List the legal business description of your business and indicate that your business is acquiring a business. Provide a detailed account of that business’ history, including staff size, location, legal business description and financial history. Identify the business’ short- and long-term goals and projections.

Create your business plan’s staffing section. List the managers and staff required to complete the business’ operations in a timely and efficient manner. Explain the functions of each manager and identify each of your business’ departments.

Identify the number of acquired employees and show how those employees will be integrated into the business. List the costs of all employment aspects, including costs, such as payroll, training, benefits and severance packages. Create an organizational chart to show the chain of command.

List the location of your business, as well as the locations of any acquired property. Explain how the properties are utilized by the business, as well as the costs for each. Include items such as zoning compliance fees, utilities and taxes in your expense list.

Show if the properties are owned, leased or rented. Address which properties will be retained and which will be released. Determine how your business will utilize the equipment and inventory acquired during the acquisition. Explain the steps that your business will use to control its losses and increase its assets.

Identify the external threats and opportunities that accompany the business acquisition. Look at areas such as customer demands, government regulation and industry competition. Research the identified areas thoroughly. Develop strategies to overcome the threats that accompany the acquisition and ascertain how your company will take advantage of its underlying opportunities.

Identify the products and services that your business will focus on after the acquisition. Categorize the original products and services against the newly acquired ones. Show and explain the costs and procedures of implementing the change requirements and merging the businesses. Identify any newly created products that result from the merge of company resources and identify any new equipment or inventory that will be required.

Identify the target market for your business. Explain how this market has changed as a result of the acquisition. Differentiate the market by separating it into categories of original, acquired and new markets. Address each category separately. Ascertain how your business will maintain its original customer base, and welcome its acquired and new customers.

Create financial statements for your business acquisition. Include personal financial statements for each owner of the business. Provide a balance sheet, income statement and cash flow statement for the business at a point just after the acquisition. Use realistic figures and assumptions when forecasting the business. Include complete financial statements for your original business and acquired business, for the past three years, to support and justify your forecasts.

Use the executive summary to introduce your business, along with the new products and services that result from the acquisition. Highlight your company’s various target markets and briefly review the trends within the industry. Review the reasons for the acquisition and explain how the acquisition will make your company stronger. Limit the executive summary to no more than three pages.

Include a copy of the acquisition contract in the appendix of your business plan, along with supporting documents, such as lease agreements, warranties and building appraisals. Begin the appendix with a content page. Label the documents accordingly and place the appendix at the end of your business plan.

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Writing professionally since 2004, Charmayne Smith focuses on corporate materials such as training manuals, business plans, grant applications and technical manuals. Smith's articles have appeared in the "Houston Chronicle" and on various websites, drawing on her extensive experience in corporate management and property/casualty insurance.

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How to Start a Business: A Startup Guide for Entrepreneurs [Template]

Published: February 15, 2024

I started a local HVAC business in the summer of 2020, and since then, I’ve learned a lot about which steps are most important for getting a business venture off the ground. To help you make your business idea a reality, I've put together a complete guide that walks you through the steps of starting a business.

The guide covers every step I’ve discovered you need to start a business, from the paperwork and finances to creating your business plan and growing your business online. At the bottom, you’ll find a library of the best free tools and resources to start selling and marketing your products and services.

Use the links below to navigate to each section of the guide:

• What do you need to start a business?

How to Start a Business

How to make a business plan, how to decide on a company name.

• How to Choose a Business Structure

How to Register Your Business

How to comply with legal requirements, how to find funding for your new business, how to create a brand identity for your new business, tips for starting a business, resources to start a business, how to start a business online.

Let's get started.

Every budding entrepreneur wants more visitors, more qualified leads, and more revenue. But starting a business isn’t one of those “if you build it, they will come” situations. So much of getting a startup off the ground has to do with timing, planning, and the market, so consider if the economic conditions are right to start a company and whether you can successfully penetrate the market with your solution.

In order to build and run a successful company , you’ll also need to create and fine-tune a business plan, assess your finances, complete all the legal paperwork, pick your partners, research apps for startup growth, choose the best tools and systems to help you get your marketing and sales off the ground … and a whole lot more.

When I first started my business, I felt overwhelmed by the sheer magnitude of requirements, which is why I’ve summed up the process to make it easier for you.

In brief, the requirements for starting a business are:

• A business plan.
• A business name.
• An ownership or business structure.
• A business registration certificate.
• A legal license or seller’s permit (as well as other legal documents).
• A source of funding.
• A brand identity.

Without these elements in place, you unnecessarily risk your new business’s future. Now let’s go over these basic steps for starting a business.

• Write a business plan.
• Choose a business name.
• Choose an ownership structure.
• Register your business.
• Review and comply with legal requirements.
• Apply for funding.
• Create a brand identity.

Having a great business idea is only part of the journey. In order to be successful, you’ll need to take a few steps to get it off the ground. In order to refine your business idea and set yourself up for success, consider doing the following:

1. Write a business plan.

Your business plan maps out the details of your business, including how it’s structured, what product or service you’ll sell, and how you’ll be selling it. Creating a business plan will help you find any obstacles on the horizon before you jump into running a business.

Pro tip: Remember that part of a business plan is telling investors or funders which specific items you need funding for. Be sure to list what you need to be funded, the reasoning behind items, and how long you will need funding.

Recommended Reading:

• What is a Business Plan? Definition, Tips, and Templates
• How to Build a Detailed Business Plan That Stands Out
• How to Write an Ecommerce Business Plan
• How to Become an Entrepreneur With No Money or Experience

70 Small Business Ideas for Anyone Who Wants to Run Their Own Business

Jump to: How to Start a Business Plan →

Featured Resource: Free Business Plan Template

Below are the key elements in a business plan template, details about what goes into each of them, and example sections at the bottom. You’ll also learn tips for writing a business plan .

1. Use a business plan template .

The executive summary should be about a page long. It should cover:

• Overview . Briefly explain what the company is, where you’ll be located, what you’ll sell, and who you’ll sell to.
• Company profile. Briefly explain the business structure, who owns it, what prior experience/skills they’ll bring to the table, and who the first hires might be.
• Products or services . Briefly explain what you’ll sell.
• The market. Briefly explain your main findings from your market analysis and product market fit .
• Financial considerations . Briefly explain how you plan to fund the business and what your financial projections are.

Featured Resource: Executive Summary Template

On the marketing side, you’ll want to cover answers to questions like:

• How do you plan to penetrate the market?
• How will you grow your business?
• Which channels will you focus on for distribution?
• How will you communicate with your customers?

Pro tip: Marketing trends change year after year, so be sure to keep up on the latest trends by subscribing to the Hubspot Marketing blog .

On the sales side, you’ll need to cover answers to questions like:

• What’s your sales strategy ?
• What will your sales team look like, and how do you plan to grow it over time?
• How do you plan to scale for growth ?
• How many sales calls will you need to make to make a sale?
• What’s the average price per sale?

Speaking of average price per sale, you’ll want to go into your pricing strategy as well.

Featured Resource: Marketing & Sales Alignment Template

More importantly, it typically doesn’t entail giving partial ownership of the business away. Instead, it’s a way of getting funding not from potential co-owners, but from potential fans and customers who want to support the business idea, but not necessarily own it.

What you give donors in exchange is entirely up to you — and typically, people will come away with early access to a product, or a special version of a product, or a meet-and-greet with the founders.

Pro tip: Choose the right platform for your crowdfunding campaign type. Some platforms are more geared towards traditional investors, while others are for donations. Learn more about crowdfunding here .

5. Venture Capital Financing

Only a very small percentage of businesses are either fit for venture capital or have access to it. All the other methods described earlier are available to the vast majority of new businesses.

If you’re looking for a significant amount of money to start your company and can prove you can quickly grow its value, then venture capital financing is probably the right move for you.

Venture capital financing usually means one or more venture capital firms make large investments in your company in exchange for preferred stock of the company — but, in addition to getting that preferred return as they would in series seed financing, venture capital investors also usually get governance rights, like a seat on the Board of Directors or approval rights on certain transactions.

VC financing typically occurs when a company can demonstrate a significant business opportunity to quickly grow the value of the company but requires significant capital to do so.

Pro tip: A lot of venture capital financing is simply being in the right room with the right people. Make sure to network extensively if this is your approach to financing.

When you’re first starting a business, you’ll need to build the foundation for a strong brand identity. Your brand identity is about your values, how you communicate concepts, and which emotions you want your customers to feel when they interact with your business. Having a consistent brand identity to promote your business will make you look more professional and help you attract new customers.

Here’s what you need to do to develop your brand identity:

1. Design a logo.

Creating the right logo for your business requires careful thought and consideration. It should be representative of your brand’s purpose and target audience, while also being memorable and distinct from competitors.

To start, you need a deep understanding of your business’s mission, values, and target audience. Think beyond what your company does and truly examine why you do what you do and who you do it for. This knowledge will serve as the foundation for your logo.

Conducting market research and identifying current logo trends can help you understand what works well for others and strategize on how to stand out. Then, start brainstorming design ideas that showcase what makes your business unique.

For instance, you could try writing out a list of words that best describe your business and what makes it special and then use those words as inspiration to start sketching ideas and concepts.

Once you have some sketches created, pick which ones you think are the best and share them with stakeholders, colleagues, and buyer personas to gather feedback and refine your design. After narrowing down a design, you’ll want to test its versatility and scalability to ensure it works well in different sizes and formats.

Pro tip: Check out this blog on designing your logo, and then try out different logo design features in Canva’s logo maker .

2. Develop a visual identity.

Your brand’s visual identity doesn’t stop at creating a logo — you’ll also need to establish guidelines for typography, color palette, imagery, and other graphic elements. The more consistent your brand is with its visuals, the more consumers will be able to recognize and trust it.

To get started, consider creating a brand mood board. Ask yourself: What kind of emotions do you want your brand to evoke? Is there a specific visual aesthetic that you want to emulate? This can help you gather visual inspiration that resonates with your brand.

Choose your color palette and typography wisely. Spend some time researching color theory , as color can have a major impact on how people perceive your brand. Make sure your typography is readable and looks good across different sizes and formats.

Additionally, you should create other visual assets such as patterns, shapes, illustrations, and icons that pair well with your color palette and typography.

Pro tip: If design and color palettes aren’t your thing, consider hiring a freelance graphic designer on LinkedIn or Fiverr to help you create your visual identity and incorporate it into your logo and overall design.

3. Craft a tagline.

In just a few words, your tagline should encapsulate your brand’s essence and communicate its value. Think of it as a written or verbal version of your logo. Both elements are created to immediately capture the attention of your audience. Even if consumers don’t remember anything about your product or service, they will remember a catchy tagline.

When crafting your tagline, keep it simple. You want your tagline to be memorable, so aim for a short phrase and focus on key benefits or unique aspects of your brand. Also consider using techniques like alliteration, rhyme, or play on words to make your tagline stand out — just make sure it aligns with the rest of your brand’s voice and tone.

Pro tip: This is another element of starting a business that could benefit from someone with experience. A marketing consultant or a content writer could help you establish a compelling tagline with the next step of developing your voice and tone.

4. Develop your voice and tone.

Your brand voice refers to the personality that your brand adopts in its communication with its audience. It provides direction on what to say and how to say it, allowing you to differentiate yourself and cut through the noise.

A well-defined brand voice helps create a distinct and memorable identity for your brand, allowing you to connect with your target audience on a deeper and more meaningful level.

When determining the appropriate voice and tone for your brand, remember that consistency is key. Ensure that your brand voice and tone align with your brand’s values, mission, and positioning. Alignment between your brand’s personality and its communication style is crucial for building trust and authenticity.

Pro tip: Adapt your voice and tone to suit the preferences and understanding of your audience. Additionally, use emotion and storytelling techniques to engage your audience and resonate with them.

5. Create brand guidelines.

Once you determine all of the previously mentioned brand elements, establish a set of brand guidelines that communicate how to appropriately use them. Having these rules and standards set in place ensures consistent and cohesive messaging and representation for your brand.

Get started by defining the rules for using your brand elements across different channels and applications, such as digital and print media, social media profiles, web design, packaging, and any other relevant materials.

Show practical examples of correct and incorrect usage scenarios to demonstrate the do’s and don’ts of brand representation. This helps stakeholders and users understand the guidelines and their application. You can also offer your team templates or mock-ups to ensure correct implementation.

Once the brand guidelines are set, distribute them to internal stakeholders and relevant external partners. To make sure everyone’s on the same page, take the time to review the guidelines with everyone and consider conducting training sessions if necessary.

As your brand evolves, so should your brand guidelines. Continuously review and update them to reflect any changes or refinements. Keep the guidelines easily accessible and communicate any updates effectively.

Pro tip: A writing style guide is a great place to start when creating brand guidelines. Check out this blog on brand style guide examples.

6. Identify your sales goals.

Don’t get intimidated by sales lingo, such as KPIs and ROI . All this means is that you need to figure out what you need to make ends meet and grow: How much revenue do you need, and how many products do you need to sell to hit that target? Create a holistic sales plan to meet your goals.

7. Hire a sales rep.

When you’re starting your business, it’s tempting to do everything yourself, including taking on sales. However, making that first sales hire is crucial to scaling — you need someone dedicated to understanding your buyers and selling to them full-time.

When looking for that first sales hire, seniority should be less of a priority than how much sales experience they have on the front lines and whether they understand your business’ target buyer. From there, you’ll want a plan for building your sales development team .

8. Get more out of your sales activities.

Efficiency is key. Put together a sales process, such as this helpful 7-step sales process framework , which works regardless of your business size. You’ll also want to automate sales tasks (such as data entry) or set up notifications when a prospective customer takes an action.

That way, you spend less time poring through records and calling the wrong prospects and more on strategy and actual selling.

9. Keep your customers happy.

Getting new customers in the door is important, but retaining them is just as important. You can’t ignore customers once you’ve closed them — you have to take care of them, give them stellar customer service, and nurture them to become fans of (and even evangelists for) your business.

While inbound marketing and sales are both critical to your funnel, the funnel doesn’t end there: The reality is that the amount of time and effort that you spend perfecting your strategy in those areas will amount to very little if you’re unable to retain happy customers.

This means that building a model for customer success should be central to your organization.

Think for a second about all the different ways reviews, social media, and online aggregators spread information about your products.

They’re all quick and effective, for better or for worse. While your marketing and sales playbooks are within your control and yours to perfect, a large chunk of your prospects are evaluating your company based on the content and materials that other people are circulating about your brand.

10. React quickly to customer issues.

People expect fast resolution times (some faster than others, depending on the channel), so it’s essential to be nimble and efficiently keep up with requests so that you’re consistently providing excellent service to avoid losing trust with your customers.

Pay attention to the volume of your company mentions on different channels. Identify where your customers spend the most time and are asking the most questions, and then meet them there, whether it’s on a social network, on Yelp, or somewhere else.

11. Keep track of touchpoints with individual customers.

Interactions with your customers are best informed by context. Keep track of all the touchpoints you’ve had with individual customers because having a view into their experience with your company will pay dividends in the long run.

How long have they been a customer? What was their experience in the sales process? How many purchases have they made? Have they given positive/critical feedback about your support experience or products?

Knowing the answers to these questions will give you a more complete picture when you respond to inquiries and will help you have more productive conversations with customers.

12. Create feedback loops.

From the moment you have your first customer, you should actively seek out insights from them. As your business grows, this will become harder — but remember that your customer-facing employees are a valuable source of information because they are most in tune with your buyers and potential buyers.

13. Create a FAQ page on your website.

Give customers the tools to help themselves, and scale this program as you grow. When you’re starting out, this might take the form of a simple FAQ page. Over time, as your customer base grows, turn your website into a resource for your customers and enable them to self-service — such as evolving that FAQ page into a knowledge base or library that answers common questions and/or gives customers instructions.

Here are some helpful resources to help you spread awareness, build your online presence, and get the leads you need for free. In addition, we’ve listed additional templates and sales tools to help you build an efficient sales engine, reach prospects, and close customers for free.

• The Ultimate Inbound Guide for Start-Ups : A guide that covers how to build an inbound sales and marketing machine, which demand generation activities offer the biggest return on investment and more.
• HubSpot’s Free Marketing Tools : A free marketing tool that gives you insight into what every lead does before and after they fill out a form. It includes built-in analytics that make it easy to learn which pages, offers, and traffic sources are driving the most conversions for you.
• Website Grader : Enter your website URL and email address, and you’ll get a detailed grade on your website’s performance, mobile, SEO, and security, along with detailed tips and resources for making impactful improvements on your website.
• Press Release Templates : Downloadable press release templates you can customize, along with a corresponding guide to building a press release and promotion plan.
• Case Study Templates : Downloadable case study templates you can customize, tips on how to find and reach out to candidates, and sample interview questions.
• Content Creation Templates : 100 social media image templates, 8 PowerPoint presentation templates, 50 call-to-action templates, 15 infographic templates, five ebook templates, five blog post templates, and more.
• Email Signature Generator : A free tool that creates a professional email signature you can easily add to your Gmail, Outlook, Apple Mail, Yahoo Mail, or any other email provider.
• Sales Email Templates : A list of email templates that have been used with tremendous success by real companies (including HubSpot).
• Sales Call Scripts : Easy-to-follow sales call scripts that can help you build rapport and develop trust, understand the prospect’s pain points, identify key decision-makers, and secure a follow-up meeting.
• Daniel Pink’s “Sell Like a Human” Video Series : Monthly video series where Sales Expert Daniel Pink and special guests solve your biggest sales challenges in under 30 minutes.
• Sales Close Rate Industry Benchmarks Tool : Compare your sales close rate against your industry competitors using data from over 8,900 companies segmented by 28 industries.

Additional Resource: Enroll in HubSpot Academy to learn everything you need to know about digital marketing and sales for small businesses. Train your whole team for free!

Starting a business online is a little different from starting a traditional business. Here are some important steps for starting and scaling your business online.

1. Determine your niche and business idea.

Your business niche is the target focus area for your product or service. It’s important to choose a niche because customers like brands and businesses that specifically cater to their needs. Most customers are more likely to purchase products or services from a brand that provides personalized experiences.

When determining your niche and business idea, first identify your target audience and specify everything from their age to their interests. Then, use that information to figure out their principal need. If your product doesn’t resolve a specific need, your business will fail to get off the ground.

Pro tip: You should have a good idea of the market at this point. Use that knowledge to position yourself in a way that differentiates you from your competitors.

2. Conduct market research.

Conduct market research to understand what product or service you should offer, whom you should serve, and where you face the stiffest competition. From physical goods to digital downloads, understanding your target market and competitors will help you determine how to best position your product.

Your research should help you create a strong selling proposition . In other words, what makes your business unique? Why should someone buy from you?

Pro tip: Sometimes, market research is as easy as calling around to competitors and getting a quote on services. Make sure your pricing is competitive but not so low as to be unsustainable.

3. Learn online business laws.

While online businesses may require fewer licenses and permits than traditional businesses, there are still legal requirements that you will need to adhere to. Be sure to check:

• What kind of business license (if any) do you need to start operations?
• What legal structure makes the most sense for your company?
• Are there any permits that you need to obtain?
• Are there any inspections that you need to pass?
• Do you need a sales tax license?
• Are there any specific regulations applicable to online businesses only?
• What are the laws regarding hiring contractors and hiring employees?

Pro tip: Check out this article for more information on starting an online business and navigating online laws.

4 . Make sure your business is insured.

Depending on your business type, you may be required by state law to be both licensed and insured. HVAC businesses have a lot of liability as they involve both plumbing and electricity. I spoke with several insurance agents before deciding on the best insurance for my business needs.

There are also many different business insurance types, such as:

• Liability insurance.
• Worker’s comp.
• Property insurance (think your business location, tools, and equipment you use).
• And more. Be sure to research these different insurance types and purchase the necessary ones.

Pro tip: Check out this article on small business insurance.

5. Create a website.

After handling the research, taking care of legalities, and honing your products or services, it is time to create your website . When creating your website, you will need to choose a strong ecommerce platform that will allow you to sell products online.

Pro tip: Check out Hubspot’s free CMS tool for website building here.

6. Set up shop.

Once your website is complete, it’s time to add products or services to your store. When adding your products, pay attention to product images and descriptions. Having a crisp image and a detailed but concise description will help your audience maneuver your website smoothly.

After you have finished setting up your store, it’s critical to ensure you offer a seamless shipping or delivery experience to your buyers. For example, you can use HubSpot to manage quality control before you ship products out.

Finally, you want to make sure everything is working before you hit the live button on your website. Make sure that everything is clickable and that all pages look good across all devices and browsers. Once you’ve checked that, you are ready to go live.

Pro tip: If you take credit card information on your website, you will need to abide by compliance laws that ensure the safety of sensitive data. Read more on credit card compliance .

7. Create a marketing plan.

You’ve created an awesome product, and now it’s time to get the word out. In other words, it’s time to grow your audience. There are numerous ways to reach your target customer, including:

• Social media : Use hashtags and paid ads to expand your reach.
• Influencer marketing : Send free samples to “celebrities” in your niche.
• Facebook groups : Connect with your target market on this platform.
• Google advertising : Put your products in front of people all over the web.
• Content marketing : Publish blog posts to bring organic traffic to your site.
• Word-of-mouth : Encourage customers to spread the word.
• YouTube videos : Start a channel to showcase your products.

Pro Tip: Google ads and LinkedIn ads regularly offer discounts or free ad money; consider using these promos to try online advertisements out.

8 . Grow your business.

You’ve heard it said that in business, you’re either growing or you’re dying. Here are a couple of tips for growing your business online:

• Reduce the amount of time it takes online viewers to receive value from you and your brand.
• Answer the questions no one in your industry is answering — for example, a lot of companies won’t talk about pricing, forcing customers to keep looking for someone who will.
• Create a dynamic website that changes with the times. Update your images and writing to reflect what’s happening with your business now, and ensure your website isn’t dating you.
• Invest in content and SEO . They aren’t cheap, but they are really important for being found online, organically.

Pro tip: Check out this blog on how to become an SEO expert, according to HubSpot’s SEO team.

9. Watch your income and expenditures closely.

The first year of your business is an essential set point for discovering your overhead and your profit. Have a date in mind of when you want your business to start turning a profit and a solid plan for if you aren’t meeting that goal. Read further on potential exit strategies below.

Pro tip: Use a free business budget template to monitor your finances.

10. Plan for an exit strategy.

If you’re like me, you didn’t consider an exit strategy when thinking up your business. You probably assumed you’d run your business for the foreseeable future. However, economic uncertainty or unexpected success can both impact the end of your business. In fact, 90% of startups fail , which makes it a wise choice to know under what circumstances you would close down your business.

You could also experience unexpected buzz and success and be offered a buyout. A good exit strategy will plan for this as well. What amount of money would make selling worth it? Consider also how long you would have to run your business before considering offers. Some want to sell high and fast, whereas other business owners want to see where things go during a set amount of time.

An exit strategy could also include who you want to inherit your business, maybe family or an employee.

Pro tip: Check out this blog on the importance of having an exit strategy.

Next Steps: Getting Ready to Launch Your Business

I know from experience that being a small business owner isn’t easy, but with the right plan, you can set up your business for success. Be sure to check and know your requirements, have a solid business plan, and submit your legal paperwork before you take your business live. Once you have a solid business plan and the financing to execute your goals, you’ll be well on the path to launching a successful enterprise.

Editor’s note: This post was originally published in August 2019 and has been updated for comprehensiveness.

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Business Acquisition Plan: What to Include in 2024 (+ Template)

Kison Patel is the Founder and CEO of DealRoom, a Chicago-based diligence management software that uses Agile principles to innovate and modernize the finance industry. As a former M&A advisor with over a decade of experience, Kison developed DealRoom after seeing first hand a number of deep-seated, industry-wide structural issues and inefficiencies.

A business acquisition plan is an important component of planning for an M&A transaction, regardless of whether you require external financing. A solid business acquisition plan should lay out the rationale for the investment, and how it will add value for the entity. In this article, FirmRoom takes a closer look at how these documents should be crafted.

Understanding Business Acquisition Plan

A business acquisition plan is a strategy document, which serves the purpose of a business plan for an M&A transaction.

It outlines the motives behind a transaction, profiles of the companies involved in the transaction, how the transaction will generate value for the entity which is driving it, how the two companies will be integrated, and how the merged company (or simply acquired company in the case of an investment firm acquiring a company) is expected to perform.

Reasons to Have a Business Acquisition Plan

An acquisition plan provides its users with a roadmap to making the transaction a success. Even before the transaction is initiated, it acts as a reminder to the sponsors, what they’re looking for, why they’re looking for it, and how they’re going to ensure that the transaction is a success.

In general terms, the reasons to have a business acquisition plan are:

Strategic alignment

The overriding goal of a business acquisition plan, as the opening text alludes to, is strategic alignment: ensuring that those undertaking the deal, for lack of a better expression, ‘stick to the plan’, around the motives and means for making the deal a success.

Valuation and pricing

The plan should include strategies and methodologies for valuing the target company. It should guide the deal participants on how to determine a fair value for the target, assess synergies, and estimate future financial returns. It also sets a limit on how much the company can extend itself financially for a deal to occur.

Financing and resource allocation

Financing (sources and uses of funds) is just one part of the resource allocation conundrum. The business acquisition plan also outlines the working capital needs, who works where, how expenditures are going to shift, what capital assets are required, and more.

Business Acquisition Plan Template

The insight that FirmRoom has gained from working with hundreds of companies on thousands of transaction, have been collated in a business acquisition plan template.

This provides a detailed roadmap of what should be included in an effective business acquisition plan, ensuring that its users have everything in place for the conclusion of a successful transaction.

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Creating a Business Acquisition Plan Step-by-Step

While developing a business acquisition plan is recommended, having an ineffective acquisition plan is worse than having none at all.

The document has to be watertight, creating no doubt in the reader’s mind about the benefits of an acquisition.

A strong business acquisition plan should make the reader think that it makes far more sense to go ahead with the transaction than for the company to continue in the status quo.

That being said, the following should only be seen as a rough step-by-step guide to putting together a business acquisition plan:

Strategy development

Best practice:

• Identify where the company wants to be in each of the next five years, possibly on a month-by-month basis, and how it plans to get there. See here for example.
• Identify the key performance indicators that need to be tracked to ensure that the company meets these objectives.
• Based on both of the above, ask whether an acquisition is a crucial part of the company achieving those objectives, before moving forward.

Identifying and evaluating target companies

• Understand where the companies that fit into the strategy will be found , and be thorough and objective in the search for them.
• Be realistic about the companies that can be acquired/merged with, including valuations ,  so as not to waste resources for other companies and your own.
• Remember that just because a company is the only one that’s available, it doesn’t mean that a transaction is a good idea.

Due Diligence

• Use technology ; any M&A practitioner that decides against using a sound technology platform for due diligence is doomed to failure.
• Adopt a mindset where due diligence is considered an investment in the acquisition, rather than a cost to your own company;
• Do not fall for the M&A acquirer’s fallacy of ‘we’ve come this far, so we can’t go back.’ If due diligence says the deal isn’t right, it isn’t.
• Begin the post-merger integration phase as soon as the deal begins to look like a realistic possibility (something which DealRoom is designed to cater for).

Deal structure and negotiation

• Leverage the findings of due diligence to create a more informed negotiation process.
• Remember that there will be back and forth with the seller, and they can be reasonably expected to overvalue their asset.
• Consider all market outcomes (i.e. downturns, current value of stock vs. future value, etc.) when creating an offer. Avoid irrational exuberance.

Post merger integration (PMI)

• Keep in mind at all times during the PMI phase that this is where most of the value can be generated and lost in a transaction.
• As mentioned, begin the process as soon as possible. If the transaction is visible on the horizon, you need to start thinking about its integration.
• Don’t write this off as a ‘soft’ or unnecessary part of the transaction - it won’t be soft when it impacts on your income statement.

Common mistakes to avoid when writing a business acquisition plan

Despite plenty of advice to the contrary, enthusiastic CXOs often write acquisition plans which fail to avoid the pitfalls.

These are among the most common:

Putting the acquisition before the strategy

The acquisition is part of the overall strategy, not the other way around. Companies that are approached by others about a deal, and then somehow convince themselves that there is a strong rationale for a deal, fall foul to this backwards logic.

Management hubris

M&A is an area ripe with management hubris (take a glance at Google Scholar at all the academic texts that link the two). That means management hubris inevitably finds its way into business acquisition plans. Avoid it at all costs - it’s a highly costly behavioural pattern for companies of all sizes.

Lack of detail

The business acquisition plan is a strategy document, not a marketing one. That is to say, it should break down in a step-by-step fashion how the deal will generate value. The more detailed the better. “Creating an outstanding organization” is great, but writing it in the business acquisition plan won’t add any value.

Business acquisition plan template

A business acquisition plan is a hugely worthwhile document that all M&A practitioners should write in order to discern the value of a transaction and how that value can be extracted. It is the business plan for an M&A transaction.

Get your free template below to receive guidelines on how to create the document and make it work for your transaction.

Frequently Asked Questions (FAQs)

Successful acquisition starts with a great plan

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Business Plan for Buying an Existing Business

OCT.18, 2023

Buying an existing business is a great way to enter a new market, expand your product or service offerings, or leverage the seller’s existing customer base and brand recognition. However, before making an offer, you need a clear and realistic acquisition business plan for running and growing the business post-acquisition.

A business plan for buying an existing business is a document that outlines your vision, goals, strategies, and financial projections for the business you want to buy. It is similar to a regular business plan but also includes information about the seller’s business history, performance, strengths, weaknesses, opportunities, and threats. 

A business plan for buying an existing business via franchise business planning services helps you to:

• Evaluate the feasibility and profitability of the deal
• Negotiate the best price and terms with the seller
• Secure financing from lenders or investors
• Manage the transition and integration process smoothly

What to Include In an Acquisition Business Plan?

A business plan for purchasing an existing business should cover all the essential aspects of running and growing a business, such as:

• Executive summary
• Company overview
• Industry analysis
• Marketing plan
• Operations plan
• Organization and management
• Financial plan

Why Do You Need a Business Plan Sample for Buying an Existing Business?

A business plan sample can help you write a business plan for buying an existing business by providing a template and examples of how to structure and present your information. A business plan for buying an existing small business can also inspire you with ideas and insights on improving or innovating the existing business.

To help you get started with writing your acquisition business plan template for buying an existing business, we have created a sample based on buying a restaurant for you.

Executive Summary

We are XYZ Restaurant Group, a company that owns and operates several successful restaurants in New York City. We seek to acquire ABC Restaurant, a well-established and popular Italian restaurant in Brooklyn, New York.

For over two decades, ABC has been a mainstay in the community, earning devoted regulars and renown for top-notch cuisine and hospitality. This 100-seat eatery runs at full capacity for lunch and dinner daily. Raking in $1.2 million yearly with $150,000 left over after expenses, ABC shows no signs of slowing down after its longstanding prosperity.

ABC Restaurant is an excellent opportunity to expand our portfolio and enter a new market. We have identified several areas where we can add value and improve the performance of the restaurant, such as:

• Updating menu and dishes
• Enhancing online presence and marketing
• Renovating interior/exterior
• Hiring and training new staff

We estimate the total cost of acquiring and improving ABC will be $500,000. We project that ABC will generate an annual revenue of $1.5 million and a net profit of $200,000 in the first year after the acquisition and grow by 10% annually.

Company Overview

XYZ Restaurant Group owns and whips up several nifty eats-places in the Big Apple. We’re crackerjack at serving out first-rate delicious eats from all over the world, like Mexican, Thai, Indian, and Mediterranean. Folks rave about our mouthwatering chow, friendly service, cozy mood, and fair coin.

Our mission is to dish up a memorable dining experience that delights taste buds and beats hopes. Our vision is to become top cook in the USA, with a diverse and brainy bill of fare for different chowhounds. We value being the cat’s meow, passionate, upright, diverse, and keeping customers cheerful.

We aim to acquire ABC, a swell and popular Italian hub in Brooklyn. ABC has loyal eaters and a dynamite food and service name. We want to buy ABC because it has a potential for growth and bankroll.

Industry Analysis

The restaurant industry in the USA is a large and diverse sector that includes various types of establishments, such as full-service restaurants, fast-food restaurants, cafés, bars, and catering services. 

Here are some key stats regarding the restaurant industry in the USA:

• The food service industry might reach $997B in sales in 2023. (Source – National Restaurant Association )
• There are 749,404 restaurants in the United States as of 2023. (Source – Zippa )
• Between April 2022 and March 2023, new business openings in the restaurant industry increased by 10%. (Source – Yelp )
• The US restaurant industry shall grow at a CAGR of 10.2% in 2022 and 2023. 

Some of the key trends and drivers that influence the restaurant industry are:

• Consumer preferences
• Regulations

Our primary competitors in the Italian restaurant segment are:

• Strong brand recognition
• Diverse menu selection
• Provides good value
• Menu lacks innovation
• Food quality is inconsistent
• Customer service needs improvement
• High quality food using fresh ingredients
• Excellent service with knowledgeable staff
• Charming, intimate ambiance
• Expensive menu prices
• Small capacity limits covers
• Relies heavily on its location

Marketing Plan

Our marketing plan for ABC is based on the following objectives:

• To increase the awareness and recognition of ABC.
• To attract new customers and retain existing customers.
• To increase the sales and profitability of ABC.

Our business plan for buying an established business consists of the following elements:

• Professionals
• Millennials
• Updating the menu and introducing new dishes
• Enhancing the online presence and marketing
• Renovating the interior and exterior
• Hiring and training new staff and implementing best practices
• Branding – Our brand name is simple, memorable, and distinctive. Our brand logo is a stylized letter A with a fork and knife on either side. Our brand slogan is “ABC: A Taste of Italy.” Our brand colors are red, white, and green, representing the colors of the Italian flag. Our brand voice is friendly, professional, and authentic.
• Offering discounts and coupons
• Implementing dynamic pricing
• Creating bundle deals
• Providing upselling and cross-selling opportunities
• Online – Search engines, social media, email, and blogs, online reviews, testimonials, and referrals
• Offline – Newspapers, magazines, radio, TV, billboards, print ads, radio spots, TV commercials, outdoor signs, flyers, brochures, and business cards
• Events – Trade shows, festivals, and community events via booths, banners, and samples to display using contests, games, and giveaways

Operations Plan

Our operations plan for ABC is based on the following objectives:

• To provide a safe, clean, and comfortable environment
• To deliver high-quality food and service
• To manage our resources and costs effectively

Our business plan for buying an existing company consists of the following elements:

• Location and Facilities – ABC operates at 123 Main Street, Brooklyn, New York. It is a prime location with high foot traffic, visibility, and accessibility. The restaurant occupies a 2,000-square-foot space, including a dining area, kitchen, storage room, restroom, and office. The dining hall has a capacity of 100 seats and can accommodate up to 150 customers at peak times.
• Food: We buy ingredients from XYZ Food Distributors, a local company specializing in Italian food products.
• Beverages: We buy our beverages from ABC Beverage Company, a national company that offers a wide range of alcoholic and non-alcoholic drinks.
• Other: We buy our other supplies from DEF Supply Store, a regional company that provides various supplies.
• Food Safety – Adhere to all FDA and DOHMH guidelines. Monitor and log temps, freshness. Train staff on protocol.
• Service Excellence – Follow XYZ standards for hiring, training, dress code, incentives, feedback. Address complaints ASAP.
• Performance Evaluation – Track KPIs (sales, costs, satisfaction, retention) with POS, software, spreadsheets. Hold regular reviews to improve.
• Business License from NYS Department of State
• Food Service License from DOHMH
• Liquor License from NYS Liquor Authority
• Health Inspection clearance from DOHMH
• Fire Inspection clearance from NYFD
• Workers’ Compensation Insurance
• Liability Insurance
• Sales Tax registration and remittance with NYS Taxation and Finance
• Passed inspections for health, sanitation, and fire safety standards
• Obtained all necessary permits, licenses, registrations, and insurance

Organization and Management

XYZ Group is a partnership between Alex Smith, Park Smith, and Mark Wood, who own 33.3% and oversee strategy, operations, and technology, respectively.

ABC is a subsidiary operated by the following staff:

• General Manager – Reports to Alex Smith, oversees daily strategic and operational planning services
• Chef – Reports to Park Smith, manages kitchen and food preparation
• Sous Chef – Assists the Chef ensures food quality
• Kitchen Staff – Report to Sous Chef, perform various kitchen duties
• Servers – Report to the General Manager, take orders, and serve customers
• Host – Reports to General Manager, greets and seats guests
• Bartender – Reports to General Manager, prepares and serves drinks
• Delivery Driver – Reports to Mark Wood, delivers orders to customers

We have an experienced, competent team at ABC with proper training, compensation, and a collaborative work culture to drive success. The organizational structure establishes clear roles and reporting lines.

Financial Plan

Our financial plan for ABC is based on the following objectives:

• To generate sufficient revenue and profit
• To maintain a positive cash flow
• To secure adequate funding

When buying an existing business, it’s important to determine how much operating capital you should plan for. Our financial plan consists of the following elements:

• Funding Sources
• Assumptions

Income Statement

• Balance Sheet
• Cash Flow Statement
• Ratio Analysis
• Break-Even Analysis

Get Expert Help with Your Acquisition Business Plan

As you can see, developing a comprehensive business plan for buying an existing business requires significant time and expertise across various areas like finance, operations, marketing, and more. That’s where our expert advisors at OGSCapital can help.

With over 15 years of experience in M&A, strategic planning, and business planning, OGSCapital has helped numerous clients acquire and integrate businesses successfully. Our business plan writers can conduct diligence, analyze the deal, create projections, and craft a winning plan tailored to you. If you’re still thinking about how to buy an existing business, partner with our seasoned advisors to maximize your chances of closing and profiting.

Frequently Asked Questions

What is acquisition in business plan.

Acquisition in a business plan is buying or merging with another company to achieve strategic or financial goals. Acquisition planning can help a company expand its market share, diversify its product portfolio, acquire new technologies or skills, or reduce competition.

How do you create an acquisition plan?

To create a business plan for buying an existing business, you must define your objectives, identify and evaluate targets, conduct due diligence for merger and acquisition , negotiate the deal, plan and execute the integration, and monitor the outcomes.

How do I prepare my business for acquisition?

To prepare your business for acquisition, you should improve your business value, know your valuation range, establish an advisory board and a transition team, clean up your financials and legal documents, and prepare a pitch deck and better buy side due diligence services .

What should be included in an acquisition plan?

A business plan for buying an existing business should include an executive summary, target description, market overview, sales and marketing, financial history and projections, transition plan, deal structure, and appendices/supporting documents.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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Positioning Your Business for Acquisition 

For many entrepreneurs and business owners, the goal is to build a successful enterprise that attracts interest from potential buyers. Whether you’re actively seeking acquisition opportunities or simply want to position your business for future growth, preparing for acquisition is a crucial step in your journey. In this blog, we’ll delve into the essential strategies and actionable steps you can take to ensure your business is primed for acquisition success.  

Understand the Acquisition Landscape

• Research recent acquisitions in your industry to understand market trends and valuation metrics.  
• Identify potential acquirers, including strategic buyers, private equity firms, and competitors.  
• Determine the motivations behind acquisitions in your industry and tailor your preparation accordingly.  

Conduct a Comprehensive Business Assessment

• Perform a thorough evaluation of your company’s strengths, weaknesses, opportunities, and threats (SWOT analysis).  
• Assess financial performance, including revenue growth, profitability, and cash flow stability.  
• Evaluate operational efficiency, scalability, and potential areas for improvement.  
• Identify key assets, intellectual property, and competitive advantages that differentiate your business.  

Optimize Financial Performance

• Ensure your financial records are accurate, up-to-date, and compliant with accounting standards.
• Improve profitability by optimizing costs, reducing overhead, and increasing operational efficiency.  
• Strengthen cash flow management practices to demonstrate stability and predictability to potential buyers.  
• Address any outstanding legal or financial issues that may impact the acquisition process.  

Enhance Operational Excellence

• Streamline business processes, eliminate inefficiencies, and improve productivity throughout the organization.  
• Invest in technology infrastructure and automation tools to enhance scalability and operational agility.  
• Develop a scalable business model that can support future growth and expansion initiatives.  
• Document standard operating procedures and key workflows to facilitate integration with potential acquirers.  

Build a Strong Management Team:  

• Develop a competent and experienced leadership team capable of driving the business forward post-acquisition.  
• Clearly define roles, responsibilities, and succession plans to ensure organizational continuity.  
• Invest in leadership development and talent retention strategies to retain key personnel during the acquisition process.  
• Foster a positive corporate culture that aligns with the values and objectives of potential acquirers.  

Protect Intellectual Property:  

• Secure patents, trademarks, copyrights, and trade secrets to protect valuable intellectual property assets.  
• Conduct intellectual property audits to identify any vulnerabilities or infringement risks.  
• Ensure proper documentation and legal agreements are in place to protect intellectual property rights.  
• Demonstrate the uniqueness and defensibility of your intellectual property portfolio to increase attractiveness to potential buyers.  

Cultivate Customer Relationships:  

• Strengthen customer relationships through exceptional service, innovation, and personalized solutions.  
• Diversify your customer base to reduce dependency on any single client or market segment.  
• Develop long-term contracts and recurring revenue streams to demonstrate stability and predictability.  
• Showcase customer satisfaction metrics, testimonials, and case studies to highlight the value of your offerings.  

Engage Professional Advisors:  

• Seek guidance from experienced M&A advisors, investment bankers, and legal experts to navigate the acquisition process.  
• Conduct thorough due diligence to assess potential buyers and negotiate favourable deal terms.  
• Prepare comprehensive documentation, including offering memorandums, financial projections, and legal agreements.  
• Anticipate potential challenges or objections from buyers and develop strategies to address them proactively.  

In Summary  

Preparing your business for acquisition is a strategic endeavour that requires careful planning, diligent execution, and a focus on maximizing value for all stakeholders involved. By understanding the acquisition landscape, conducting a comprehensive business assessment, optimizing financial performance, enhancing operational excellence, building a strong management team, protecting intellectual property, cultivating customer relationships, and engaging professional advisors, you can position your business for acquisition success. Whether you’re actively pursuing acquisition opportunities or simply want to enhance the value of your business for future growth, these strategic steps will help you navigate the acquisition process effectively and achieve your goals.  

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Master the Art of Acquiring Single Family Home Building Business!

By alex ryzhkov, resources on single family home building.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan

The single-family home building industry in the US is experiencing steady growth, driven by high demand from homeowners looking for custom-built homes that meet their unique needs and preferences. According to recent statistics, the industry has seen an increase in revenue of 5.3% annually over the past five years. This presents a lucrative opportunity for aspiring entrepreneurs looking to acquire and operate a single-family home building business.

Before diving into the acquisition process, it is crucial to conduct thorough market research and assess the demand for single-family home building in your target area. Understanding the local market dynamics, such as population growth, income levels, and housing trends, will help you determine the viability of your business venture.

Once you have identified a suitable market, it is important to define your acquisition criteria and narrow down potential targets. Consider factors such as the size and reputation of the business, its financial health, and its track record of successful projects.

Conducting due diligence on potential acquisition targets is a crucial step to ensure you are making an informed decision. This involves analyzing financial statements, reviewing contracts and permits, assessing the performance of past projects, and conducting a comprehensive evaluation of the business's assets and liabilities.

Developing a comprehensive business plan and financial model is essential for securing financing and attracting potential investors. This should outline your strategies for marketing, project management, customer acquisition, and profitability projections.

Securing financing is a key aspect of acquiring a single-family home building business. Explore various funding options, such as bank loans, private investors, or partnerships, to provide the necessary capital for the acquisition and future operations.

Preparing and negotiating the terms of the acquisition agreement is a critical step that requires legal expertise. Seek professional advice to ensure that the agreement includes all relevant terms and conditions, such as purchase price, warranties, and non-compete clauses.

Obtaining necessary regulatory approvals and permits is crucial to ensure compliance with local building codes and regulations. Engage with local authorities and consult with professionals in the industry to navigate through the permit application process smoothly.

Once all the necessary steps have been completed, it is time to execute the acquisition agreement and complete the transaction. Engage with legal counsel and financial advisors to ensure a seamless transition of ownership and transfer of assets.

The final step is to begin implementing your business plan and financial model. Utilize your expertise and experience to deliver high-quality homes to customers, while continuously striving to meet their evolving needs and preferences.

Conduct Market Research and Assess Demand for Single-Family Home Building

Before entering the single-family home building business, it is crucial to conduct thorough market research to assess the demand for such properties in your target area. This research will provide valuable insights that will assist you in making informed decisions and developing a successful business strategy.

Here are some key steps to help you conduct effective market research:

• Identify your target market: Define the geographic area in which you plan to operate and identify the specific demographics and preferences of potential homeowners. Understanding the needs and desires of your target market will allow you to tailor your offerings to meet demand.
• Analyze market trends: Study the current state and historical trends of the single-family home building industry in your target area. This analysis will help you determine if there is steady or increasing demand for new homes, identify any seasonal patterns, and anticipate any potential market fluctuations.
• Assess competition: Identify and analyze your competitors in the single-family home building market. Understand their strengths, weaknesses, and market positioning. This will enable you to identify any gaps in the market that you can capitalize on and differentiate yourself from your competitors.
• Evaluate local regulations and zoning: Familiarize yourself with local regulations and zoning laws that may impact the construction and development of single-family homes in your target area. Understanding the legal landscape will help you navigate any potential challenges and ensure compliance with all necessary requirements.
• Engage with local real estate agents, developers, and industry professionals to gain insights into the local market and gather valuable market intelligence.
• Utilize online resources, such as real estate websites and industry reports, to gather market data and trends specific to single-family home building.
• Consider conducting surveys or focus groups to gather direct feedback from potential homeowners on their preferences and needs.
• Stay updated on economic indicators, population growth, and any planned infrastructure developments in your target area, as these factors can significantly impact the demand for single-family homes.

Define Your Acquisition Criteria And Identify Potential Targets.

Defining your acquisition criteria is a crucial step in the process of buying or acquiring a single-family home building business. This will help you narrow down your search and identify potential targets that align with your goals and objectives.

When defining your acquisition criteria, consider factors such as:

• Geographical Location: Determine the areas where you are interested in acquiring a single-family home building business. Consider factors such as local market demand, competition, and economic growth potential.
• Size and Scope: Decide on the size and scale of the business you want to acquire. Determine whether you are looking for a smaller operation or a larger company with multiple projects.
• Reputation and Track Record: Research and identify businesses with a solid reputation and a track record of delivering quality construction projects.
• Financial Stability: Assess the financial health of potential targets. Look for businesses with stable revenue streams, good profitability, and manageable debt.
• Expertise and Management Team: Evaluate the expertise and experience of the existing management team. Determine whether they have the skills and knowledge necessary to successfully run the business.
• Consider hiring a professional business broker or consultant to assist you in identifying potential targets and evaluating their value.
• Network with industry professionals, attend conferences, and join relevant associations to expand your connections and gain insight into potential acquisition opportunities.
• Stay updated on market trends, changes in regulations, and emerging technologies that could impact the single-family home building industry.
• Be flexible in your criteria and willing to adjust as needed during the acquisition process. Keep an open mind and consider opportunities that may not fit your initial criteria but have growth potential.

Once you have defined your acquisition criteria, you can start identifying potential targets by conducting market research, analyzing industry reports, and contacting industry contacts and professionals. This will help you create a list of potential businesses that meet your criteria and are worth further consideration.

Conduct Due Diligence On Potential Acquisition Targets

Conducting due diligence is a crucial step in the process of acquiring a single-family home building business. It involves the thorough investigation and examination of potential acquisition targets to ensure that they align with your business objectives and present favorable opportunities for growth and profitability.

During the due diligence process, you will gather and analyze information about the target business, including its financial performance, market position, operational capabilities, and legal and regulatory compliance. Here are some important considerations:

• Financial Performance: Review the target company's financial statements, tax records, and other relevant documents to assess its overall financial health, profitability, and cash flow. Look for any red flags or significant liabilities that could impact the value or stability of the business.
• Market Position: Evaluate the target company's market share, competitive landscape, and customer base to determine its growth potential and market opportunities. Consider factors such as location, demographics, and market trends that could affect the demand for single-family homes.
• Operational Capabilities: Assess the target company's operational capabilities, including its construction processes, project management practices, and supply chain relationships. Verify the quality of its workmanship and its ability to meet project timelines and deliver high-quality homes.
• Legal and Regulatory Compliance: Ensure that the target business is in good standing with all necessary licenses, permits, and certifications required for single-family home construction. Review any ongoing legal disputes or regulatory issues that could pose risks or obstacles to the acquisition.
• Engage qualified professionals, such as attorneys and accountants, who specialize in mergers and acquisitions to assist you in conducting due diligence effectively.
• Request and carefully review all relevant documentation, including contracts, construction plans, warranties, and maintenance records to gain a comprehensive understanding of the target business.
• Interview key personnel and visit construction sites, if possible, to observe the target company's operations firsthand and assess its team's expertise and professionalism.
• Consider seeking references from the target company's previous clients to gather insights into their satisfaction with the builder's work and customer service.

By conducting thorough due diligence, you can mitigate risks and make informed decisions about whether a potential acquisition target aligns with your strategic goals and has the potential to contribute to the success of your single-family home building business.

Develop A Comprehensive Business Plan And Financial Model.

Developing a comprehensive business plan and financial model is crucial for the success of any acquisition in the single-family home building business. This step will help you outline your goals, strategies, and projected financial performance, providing a roadmap for your future operations.

When developing your business plan, consider including the following essential components:

• Executive Summary: Summarize your business concept, target market, competitive advantage, and overall goals.
• Market Analysis: Conduct extensive research on the housing market, including current trends, demand-supply dynamics, and potential competitors. Identify your target market segment and highlight key factors that will drive demand for your homes.
• Business Structure and Management: Define your business structure, whether it be sole proprietorship, partnership, or corporation. Introduce your management team and highlight their qualifications and experience in the industry.
• Marketing and Sales Strategy: Outline your marketing and sales approach, detailing how you will attract potential homebuyers and establish a strong brand presence. Include pricing strategies, advertising channels, and anticipated sales volumes.
• Operations Plan: Describe how you will manage the construction process, including site preparation, subcontractor management, quality control, and project timelines. Highlight any innovative techniques or technologies you plan to utilize.
• Financial Projections: Develop a detailed financial model that includes projected revenue, expenses, and profitability over a specific period. Consider factors such as construction costs, land acquisition expenses, overhead costs, and expected profit margins.
• Ensure your business plan and financial model align with the current market conditions and industry benchmarks.
• Seek assistance from industry professionals or consultants to validate your assumptions and provide expert guidance.
• Regularly update and revise your business plan as market conditions change to ensure its relevance and accuracy.
• Consider the potential risks and challenges of the single-family home building industry and develop contingency plans to mitigate them.

Developing a comprehensive business plan and financial model will not only help you secure financing but also serve as a guiding tool for the successful execution of your acquisition. It will demonstrate your thorough understanding of the industry and your ability to generate profits in the highly competitive single-family home building market.

Secure Financing And Explore Various Funding Options.

Securing financing is a crucial step in acquiring a single-family home building business. It is important to explore various funding options to ensure you have the necessary capital to complete the acquisition and support your business operations.

When it comes to securing financing, there are several options you can consider:

• Traditional bank loans: Approach banks and financial institutions to discuss loan options specifically designed for the acquisition of a business. These loans typically require a solid business plan, financial projections, and collateral.
• Small Business Administration (SBA) loans: The SBA offers loan programs that provide financial assistance to small businesses. These loans have favorable terms and can be used for business acquisitions.
• Private equity or venture capital: Explore the possibility of partnering with private equity firms or venture capitalists, who can provide the necessary capital in exchange for equity in the business.
• Seller financing: In some cases, the seller of the business may be willing to finance a portion of the acquisition. This option allows for a smoother transition and demonstrates the seller's confidence in the business.
• Crowdfunding: Consider crowdfunding platforms to raise capital from a large number of individuals who are interested in investing in your business.
• Personal savings or equity: Utilize your own personal savings or equity from existing assets to finance the acquisition.
• Prepare a solid business plan and financial projections to demonstrate the viability and profitability of the single-family home building business to potential lenders or investors.
• Research and compare interest rates, repayment terms, and fees associated with different funding options to make an informed decision.
• Consider seeking guidance from a financial advisor or consultant who specializes in business acquisitions to assist you in navigating the financing process.
• Be prepared to provide necessary documentation, such as financial statements, tax returns, and personal financial information, when applying for financing.
• Keep in mind that securing financing may take time, so it is important to start the process early and be patient throughout the negotiation and approval stages.

Prepare And Negotiate The Terms Of The Acquisition Agreement

Once you have identified potential targets for acquiring a single-family home building business, the next step is to prepare and negotiate the terms of the acquisition agreement. This agreement will outline the terms and conditions under which the acquisition will take place, including the purchase price, payment terms, and any contingencies or conditions that need to be met.

When preparing the acquisition agreement, it is important to clearly define the rights and obligations of both parties involved in the transaction. This includes detailing the assets and liabilities that will be transferred, any warranties or representations made by the seller, and the timeframe for completing the acquisition.

During the negotiation process, it is essential to carefully review and assess the terms proposed by the seller. Consider engaging legal and financial professionals to ensure that the agreement is fair, reasonable, and protects your interests.

• Clearly define the purchase price: Negotiate a purchase price that accurately reflects the value of the single-family home building business. Consider factors such as the company's assets, revenue, and future growth potential.
• Include necessary contingencies: Specify any conditions that need to be met before the acquisition can be completed, such as obtaining financing or regulatory approvals.
• Review warranties and representations: Carefully assess any warranties or representations made by the seller regarding the condition of the business, its assets, or its financial performance.
• Set a realistic timeframe: Agree on a reasonable timeframe for completing the acquisition, taking into account any necessary due diligence processes or regulatory requirements.
• Consider including provisions for post-acquisition support from the seller, such as training or assistance with the transition process.
• Engage legal and financial professionals with experience in mergers and acquisitions to guide you through the negotiation process and ensure a legally sound agreement.

By carefully preparing and negotiating the terms of the acquisition agreement, you can ensure a smooth and successful transaction that aligns with your goals and protects your investment.

Obtain Necessary Regulatory Approvals And Permits.

Obtaining necessary regulatory approvals and permits is a crucial step in acquiring a single-family home building business. These approvals and permits ensure that your business complies with all local, state, and federal regulations and is authorized to operate legally in the construction industry.

Here are some important considerations when it comes to obtaining necessary regulatory approvals and permits:

• Research local building codes and regulations: Familiarize yourself with the specific building codes and regulations in the areas where you plan to operate. This will help you understand the requirements and standards that need to be met in order to obtain the necessary approvals and permits.
• Identify the required approvals and permits: Determine the specific approvals and permits that are required for your single-family home building business. This may include permits for construction, zoning, land use, environmental impact, and occupancy.
• Engage with regulatory authorities: Reach out to the relevant regulatory authorities to understand the application process and requirements for each approval or permit. This may involve meeting with building inspectors, zoning officials, and environmental agencies.
• Prepare and submit applications: Complete all necessary paperwork and submit the applications for the required approvals and permits. Include all required documentation, such as architectural plans, engineering reports, and financial statements.
• Follow up and comply with any additional requirements: Once the applications are submitted, stay in regular communication with the regulatory authorities to address any additional requirements or concerns they may have. Be prepared to provide any requested additional information or documentation.
• Allocate sufficient time: The process of obtaining regulatory approvals and permits can take time, so it is important to allocate sufficient time for this step in your acquisition plan. Delays in obtaining approvals and permits can potentially impact your project timeline and financial projections.
• Consider hiring a lawyer or consultant: Engaging the services of a lawyer or consultant who specializes in construction and regulatory matters can help ensure that your applications are complete, accurate, and in compliance with all applicable regulations.
• Build strong relationships with regulatory authorities: Building strong relationships with regulatory authorities can help streamline the approval process and facilitate ongoing compliance with regulations. Be responsive, respectful, and proactive in your interactions with these authorities.

Execute The Acquisition Agreement And Complete The Transaction

After conducting a thorough due diligence process and negotiating the terms of the acquisition agreement, it's time to proceed with executing the agreement and completing the transaction. This step marks the final stage in acquiring the single-family home building business and officially becoming the new owner.

The execution of the acquisition agreement requires careful attention to detail and adherence to legal requirements. It is essential to ensure that all parties involved fully understand and agree to the terms and conditions outlined in the agreement.

Here are a few tips to guide you through the execution and completion of the transaction:

• Engage legal professionals: Seek the assistance of experienced attorneys to oversee the legal aspects of executing the acquisition agreement. They will ensure that all necessary documentation is in place and the transaction is compliant with relevant laws and regulations.
• Coordinate with stakeholders: Communicate with all relevant stakeholders, including the sellers, employees, and any other parties impacted by the transaction. Ensure that everyone is aware of the impending ownership transfer and the key timelines or requirements.
• Obtain required approvals: If there are any regulatory approvals or permits required for the acquisition, make sure to complete all necessary applications and submit them in a timely manner. This may include obtaining approvals from local government bodies or industry regulators.
• Review financial obligations: Before completing the transaction, carefully review any outstanding financial obligations or liabilities of the business. This includes ensuring that any outstanding debts, taxes, or legal disputes are addressed and resolved appropriately.
• Ensure smooth transition: Plan for a smooth transition period after the completion of the transaction. This may involve integrating the newly acquired business into your existing operations, informing customers and suppliers of the change in ownership, and addressing any potential challenges that may arise during the transition.

By following these steps and considering the tips provided, you can effectively execute the acquisition agreement and complete the transaction to acquire your single-family home building business. With the proper preparations and attention to detail, you can smoothly transition to the next phase of implementing your business plan and financial model.

Begin Implementing Your Business Plan And Financial Model.

Now that the acquisition process is complete and you have taken ownership of your single-family home building business, it is time to start implementing your business plan and financial model. This step is crucial as it sets the foundation for the success and growth of your business.

1. Assemble your team: Building a strong team of professionals who can execute your business plan is essential. This includes hiring skilled project managers, architects, engineers, subcontractors, and administrative staff. Each member of your team should have a clear understanding of their roles and responsibilities.

2. Establish operational processes: Develop efficient operational processes to ensure smooth project management and construction operations. This includes defining guidelines for project scheduling, procurement, quality control, and safety procedures. Regularly review and adjust these processes to improve efficiency and address any challenges that may arise.

3. Monitor financial performance: Continuously monitor the financial performance of your business to ensure that it aligns with your financial model. Regularly track revenue, expenses, and cash flow to identify any areas of improvement or potential risks. Use this information to make informed business decisions and adjust your financial model as needed.

4. Implement marketing and sales strategies: Develop and execute marketing and sales strategies to promote your business and attract potential clients. Utilize various channels such as online advertising, social media, networking, and traditional marketing methods to establish your brand and generate leads. Continuously analyze and refine your marketing efforts to reach your target audience effectively.

5. Build strong relationships: Establish strong relationships with suppliers, subcontractors, and other stakeholders in the real estate industry. This will help you secure the necessary resources, negotiate favorable terms, and enhance your reputation. Foster open communication and collaboration to ensure smooth project execution and successful outcomes.

• Regularly review and update your business plan and financial model to adapt to changing market conditions and opportunities.
• Stay updated with industry trends, construction techniques, and building codes to maintain a competitive edge.
• Invest in ongoing professional development for yourself and your team to enhance skills and stay abreast of industry best practices.
• Continuously seek feedback from clients, subcontractors, and other stakeholders to identify areas for improvement and ensure customer satisfaction.

By effectively implementing your business plan and financial model, you can position your single-family home building business for long-term success. Stay focused, adapt to market conditions, and strive for continuous improvement to drive growth and achieve your goals.

Acquiring a single-family home building business is a complex process that requires careful planning and consideration. By following the checklist outlined in this blog post, you can ensure that you have covered all the necessary steps to successfully acquire and run a single-family home building business.

From conducting market research and identifying potential targets to securing financing and completing the transaction, each step plays a crucial role in the overall success of your acquisition. By taking the time to thoroughly assess the demand, conduct due diligence, and develop a comprehensive business plan, you will be well-prepared to implement your vision and deliver high-quality homes to your clients.

Remember to carefully negotiate the terms of the acquisition agreement and obtain all necessary regulatory approvals and permits. This will ensure a smooth transition and compliance with all legal requirements. Once the acquisition is complete, it's important to stay focused on implementing your business plan and financial model, utilizing your expertise to deliver exceptional results.

Acquiring a single-family home building business can be a lucrative venture, but it requires careful planning, research, and execution. By following the steps outlined in this checklist, you can increase your chances of success and establish yourself as a reputable builder in the industry.

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4 Lessons I Learned From Acquiring a Business

Posted august 9, 2018 by holly rollins.

One of the very first steps you will need to take is to assemble a dream team. This team should be made up of legal counsel, a financial advisor, entrepreneurial mentors , and anyone else you can think of to help you make the smartest possible decisions for your existing and future business.

There are many things I’ve learned from acquiring a business, so here is my advice for a first-time buyer.

1. Vet your potential business

All businesses have skeletons in their closets, and it’s your job to figure out what those skeletons are up front and then decide if they are worth the trouble of dealing with post-acquisition.

There’s no perfect company, and there is a lot you can and will uncover in the aftermath of acquisition, so being as prepared as possible is key. It’s best to know the ins and outs of not only the business you are looking to acquire but also its competitors and the big picture of the industry (if you’re not already in that industry). The bigger picture is just as important as the smaller details.

For example, when I bought a digital marketing business, the intent was to combine the two different entities into a more powerful brand and do it sooner rather than later. The other business owner (who stayed following the merger) had different expectations. He wanted to maintain the two different brands, websites, and some of the business ideologies under silos for more than a year.

In retrospect, I should have spelled out my intention to have the company fly the new flag under one brand and one message before the contract ink was dry. While every merger or acquisition has a transition period, the best practice is to quickly and as seamlessly as possible, present a united face and message to past, present, and future clients and stakeholders.

This is just one of many business policies you will need to negotiate and place in a contract prior to signing. Many of these policies will be specific to your type of business or situation, so make sure to do your research and consult with the dream team you’ve hopefully assembled by this point in the process.

2. Strong leadership skills matter

Merging two teams together under one new company is no task for the weary. It requires exceptional leadership, patience, and drive among many other skills. Often, when acquiring a business, leaders have a pre-conceived notion of how well their two teams will get along and see eye-to-eye, and that’s rarely the case. For a successful start following the merger, everyone must agree on a common vision and mission and be willing to make compromises.

While you’ll likely be working out the kinks many months later, setting a solid foundation for your team and being a great leader is a necessity for long-term success. Set up team-building exercises and quarterly retreats if possible, especially if all or part of your team is remote. These community-fostering junkets and practices are a good way to start on the right foot with employees and will help build and maintain the new company culture.

Also, either before or after the merger, implement personality testing as well as a survey regarding the company, its mission and overall company objectives and policies. While some may be suspicious at first of the personality testing, ensure it is distributed with the intent to build an environment where people know how to communicate with each other’s different personality profiles.

3. Focus on the financials

During the exciting acquisition phase, many people will be tempted to dream of counting stacks of money based on the numbers outlined in the pitchbook of the company or business broker. But beware, just as mentioned earlier, the discovery process doesn’t always pull back the curtain on  everything.

Securing a financial or accounting expert early on is a linchpin for your success. Even if you are a genius at numbers and spreadsheets, having a professional in this area allows you to focus on the highly important task of merging the two companies while he or she keeps your financial records organized, healthy, and pointed toward future earnings.

4. Prioritize and monitor the details

If you’re running a successful business, you’re probably at a point where you don’t have to pay attention to the small details day in and day out. When you merge two businesses together, however, this is an extremely important part of the acquisition—at least for a year or more, depending on the scope of your operation.

You should get up close and personal with all aspects of your business, your managers, and employees. That way you can guide and refine the business model as your business grows and becomes even more profitable .

A CRM (customer relationship management) software where everyone (or those that it pertains to) can track and monitor jobs or tasks is a foundational tool where all can be involved in the company’s productivity and success. Even if you use Google Docs or a tool you inherited from the other company in the beginning, plan to combine all information into the next best platform that can scale as you mature, such as Salesforce or Insightly.

Persistence and process

Persistence, diligence, and process are mantras I suggest you focus on—in the beginning, and on an ongoing basis. It can be hard to stay motivated before you start seeing the fruits of your labor.

Keep engaging with your mentors and professionals in the year-long or more onboarding time period and remember that proper processes are not optional, they are imperative for success.

Your days will be long and grueling to start, but eventually, you’ll get to a place where you can step back and reap the benefits of your time, your financial output, and sweat equity.  

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Holly Rollins

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