Strategies: Lessen start-up time by buying a bu…

So you want to own your own business.

Notice I didn't say start your own business. The popular idea of going into business usually conjures an image of an entrepreneur or two starting at their kitchen table, growing their small business from the ground up.

COLUMN: Pros, cons of seller financing
COLUMN: Buying biz an option if job's in danger

But you can go into business another way: You can buy an existing business.

Too few entrepreneurs consider the option of buying a business. When you buy on ongoing concern, you're further down from the starting line and you have several other advantages:

1. Existing customer base. This is the No. 1 reason to buy an existing small business.

But you need to make sure these customers will be a source of recurring revenue.

In some types of businesses, a hair salon or a doctor's practice, for instance, customers or patients are likely to try you at least once. But you have to assume they're also asking their friends for recommendations.

With a local business such as a coffee shop, a Laundromat, or a clothing store, unless you drastically change the quality of your merchandise, service or price, customers likely will return because the business has become part of their routine.

Other types of business typically don't get repeat customers, such as wedding planners and event photographers. Buy one of these and you'll still have to look for new customers. So what is the value of buying such a business?

2. Location, location, location. Often the greatest value of a small business is its physical location.

An ice cream parlor or surf shop on a beach boardwalk has a competitive advantage that you may not be able to replicate elsewhere. Or the small business you have your eye on may have a long-term lease in a building that's highly desirable, and perhaps that long-term lease is transferable and cheap.

Sometimes an ice cream shop's secret recipe is reason enough to buy an existing business.(Photo: Smitten Ice Cream)

3. Existing product. The business you are considering buying may have a product you want to sell.

The seller has done the groundwork — created a prototype, taken care of government regulations like trademarks and certification. Maybe the present owners have a great product and you realize its potential.

4. Proof of concept. A company may have done the hard work of proving a new business concept such as creating a following for a mobile app.

Perhaps the company has received some recognition but isn't in a position to build to the potential you know is there. If the product has patent protection, that's another good reason to buy.

5. A great team already in place. Many times companies are acquired for their human resources as much as their products or locations.

Just make sure the great team at the real-estate firm, graphic design business, or tech company will stay after you take over. Technology companies have started to "acqui-hire," buy small tech start-ups, acquire the top-notch talent and dump the technology.

6. Physical assets. A bakery with ovens and equipment or a construction company with trucks and tools may be easier to acquire secondhand than getting the financing to start from scratch.

If the business is selling cheaply, you may get such assets at a bargain. Or the business may not be so great, but it comes with a fleet of vans or a warehouse and you see the potential to do something else with it.

Real-estate developers may buy a company for its land, for example, then close the company and build.

A word about non-compete clauses: If you're buying from someone, you want to make sure they won't go into the same business across the street from you six months lat! er.

They may say they're retiring but get bored playing golf in a few months. Remember, the business was once their baby. They're going to see what you're doing and think it's wrong even if it's working out.

Talk to a lawyer to make sure you have the right non-compete provisions for your state.

Finally, keep in mind that many small-business owners think their business is worth much more than it really is. So bargain hard.

Buying a business may give you a faster start toward fulfilling your dream.

Rhonda Abrams is president of The Planning Shop and publisher of books for entrepreneurs. Her most recent book is Entrepreneurship: A Real-World Approach. Register for Rhonda's free newsletter at PlanningShop.com. Twitter: @RhondaAbrams. Facebook: facebook.com/RhondaAbramsSmallBusiness.Copyright Rhonda Abrams 2013.