The Cost Effective Small Business Opportunity ...

One type of business that is often quite popular and needs some explanation is the small business opportunity.

Typically this type of small business is where you buy the means to start the business, including the materials or equipment needed and you are then left to your own devices.

You run the business as you like with no further input from the business opportunity seller, and no further fees or royalties.

You usually name and market the business in your own way.

Finding Your Business Opportunity and Small Business Partner

An Opportunity for Your Own Small Business

Compared with buying an established small business (lock, stock and barrel), buying any of the many small business opportunities can be cheaper and involve less risk if you select carefully.

Buying a franchise on the other hand means having to strictly adhere to all the franchisors rules and regulations. Not for you if you like your freedom.

If you want to get into business quickly and cheaply and don't like being told what and how to do everything, then buying a small business opportunity might be right for you.

Can a Small Business Opportunity be right for you?

There are many business types that can be classified as business opportunities and to give you some idea of the range, I will list the major types ...

Distributors ...

Many large businesses will appoint distributors to help sell their products.

The appointed distributor can be an individual or a company and has the right to sell the products of the parent company, but does not have the right to use its trade name.

If you buy a distributorship you can generally also sell on to dealers within your authorized area.

Dealerships ...

Similar to a distributor, but will normally sell only to end customers and sometimes retailers.

Both distributors and dealers can use their supplier?s trade name to advertise their goods, but cannot call themselves by this name.

For example, you could be a Hitachi dealer and use all their supplied advertising, but you could not call your business Hitachi Suppliers Corp.

Affiliate Cooperation ...

For promotional or advertising purposes many businesses selling the same products or service, band together to help keep costs down.

If your business is similar to other businesses, then being affiliated to them can be worthwhile.

Many a small business opportunity can be found with affiliations.

Internet Affliliate ...

Do not confuse the above with the affiliations commonly found on the internet. These affiliations do not really involve seperate business entities with common product types banding together to reduce costs. Rather it is more usually a website designer promoting the products or services of another company.

More like a dealership than a true affiliation.

Large online businesses favor internet affiliate marketing because it mostly uses a "pay for performance" business model. Meaning that the business owner does not incur a marketing expense unless a website owner generates a specific result. Some large businesses have had great success using this marketing technique, notable examples being ebay.com and amazon.com.

Licensees ...

Many companies will license their technology, equipment etc and allow you to buy the right to use this under license.

In many cases they will teach you their processes and sell you their machinery, raw materials and supplies, provided you sell, in some cases exclusively, their products.

You will be allowed to sell under their trade name, but still remain an independent business.

5. Network Marketing

Here you buy, usually at low cost, the right to sell the product of a Multilevel Marketing or Network Marketing company (sometimes called a direct sales company).

Many such network marketing companies are very popular, with names like Tupperware, Avon, etc.

The business can be operated as a part-time or home-based business, making for a very flexible business indeed.

6. Vending Machines ...

Millions upon millions of vending machines are available and in use worldwide.

Many of the machine manufacturers will sell these machines and provide training in their use and maintenance.

They also provide spares and in many cases also supply maintenance or technical support.

After buying the vending machines, you find locatations for them, then restock and collect any money from them.

Advantages of Buying a Small Business Opportunity ...

Take away the large costs involved in buying a franchise or the funding required to start a small business from scratch and you can still find a cost effective small business opportunity waiting for you.

Advantages ...

  • All you buy is a package to enable you to start your own business, so you are your own boss from day one.
  • The seller of the package has no control over your business, which is not the case when buying a franchise business.
  • Your investment is limited to paying for goods and services only. No liabilities, as can be the case when buying a small business that has already been trading for some time.
  • There is some buyer protection in many states in the USA. These can be checked out, through your Attorney General?s Office.
  • In most cases you will have the value of a well known brand name for the goods you intend selling.
  • Buying a small business opportunity is less restrictive than buying a franchise and usually much easier than buying a small business from scratch.
Disadvantages of buying a small business opportunity
  • Often there is no further relationship with the seller. You are on your own with no after sales service. You need to understand and plan for this before buying.
  • If you do not carry out proper due diligence checks, you can be conned into buying a business opportunity that promises very high earnings.
    • If you are not careful, you can be easily misled with unverified figures and the seller may run away with your money.
    • So investigate any opportunity thoroughly before committing yourself.
  • The multi-level marketing business, if reliant on recruitment of further representatives and not product sales, can be classified as a pyramid scheme, which is illegal.
    • Be very careful of any MLM business with no track record or verifiable proof of earnings.

In general there are a great number of small business opportunities for you to choose from, all of which will help you start your own small business with minimal start-up costs. Remember however, that in all cases, you have to study the potential market for the business type and sector you are thinking of buying.

If there is a gap in the market near you, that is waiting for just such a business, then you could have a winning business opportunity.


Business Paying for New Business

There are many opportunities in business, but any small business opportunity should be checked thoroughly before making a decision to buy.

The more well known the business you are looking to buy, the less checking you will need, but beware, less checking does not mean no checking.

You must check all small business opportunity sellers, not only to see if the seller is honest and the business viable but also to see if they have exactly what you want.

The more thoroughly you check the less likely you are to have problems and the more likely you will end up satisfied, so ...

  • Contact the seller and ask for a full list of people they have sold to in your state or area. Don't let them give you their pick of 4 or 5 names; obviously these will only be the best. Contact as many of these people as you can and ask if they would recommend the business model
  • Use the guidelines supplied in buying a small business or buying a franchise. Many of them apply to buying a small business opportunity.
  • Check the principle seller with your State agencies, such as the Commission of Securities and the Commission of Financial Institutions. They will be only too willing to let you know if the seller is complying with regulations or has any pending lawsuits.
  • Check the opportunity with Dun and Bradstreet and your Better Business Bureau.

Finally use your common sense, if it doesn't feel right and you don't really like it ... don't buy into it.

The more effort you put into checking out what is right for you, the better your chances of buying a small business opportunity that will be successful.