if you do a due dilligence on a small business, its good, do you have a shot at being sucsessful with it?

Question

if you do the due dilligence and the records show that the business has done well up to the time it has been sold

is the next owner likley to do well?

Answer 1

Yes!

Answer 2

It depends on many factors. Where is the current market trend with respect to what goods or services the business is in? What experience does the new owner have? Would the former owner be willing to be retained as a consultant on a limited basis? How critical are the relationships the current owner has with established clientele, that they would continue to do business with the new owner? Has due dilligence included learning about the current owner's personality, if the business operates on a more personable level? WHO owned the business can , in many case be as important as WHAT the business is.

Answer 3

Not really. Poor management can kill the best business. Look at all the software companies that have risen, made millions, were bought out by some bigger company and after a short time went out of business. What happens is that new management doesn't understand the business and what made it a success, especially the role key employees played. They alienate the those employees who go elsewhere and that is the kiss of death.