One way to grow your small business is to buy another business and merge the two together. When the going gets though, i.e. a recession – many of the non-bootstrapping businesses will be for sale or in trouble. This is the time for you to sharpen your bootstrapping pencil and think about opportunities that present themselves.
If you do not know what to look for here are some pointers:
1. Customers complain about your competitor;
2. Employees from your competitor apply for a job with your business;
3. Competitors loosing the plot, i.e. unrealistically low prices;
4. Court judgements against your competitor or disgruntled suppliers;
5. Partners and directors resigning or leaving the business.
Be aware of potential pitfalls, especially if you have never done this sort of thing before. Get your accountant to help you evaluate the competitor and then make a move.
Don’t loose your business focus, however tempting the opportunity. It is easy to damage your business with an uncontrollable acquisition. ST.