Start A Business Or Buy A Business

How does the risk of starting a new business compare with the risk of buying a business?
April 6, 2010 - PRLog -- April 6, 2010, Boston, Massachusetts. Some interesting statistics were published by the Small Business Association, Office Of Advocacy. This information can be useful in many ways says Tom Giampapa, Managing partner of Bizlinkin a National Business For Sale Website, if you are trying to decide on starting a new business or  buying an existing business.

There are 26.6 million small businesses in the U.S. Expected growth in a year is around 627,000 new start up businesses and about 600,000 business failures. In that same period approximately 45,500 businesses will file for bankruptcy. Over the last 15 years, Small Businesses in the U.S. have created some 65% of all private employment.

The question, how does the risk of starting a new business compare with the risk of buying an existing business? There are many determining factors when trying to find that answer. The following data may help.

If one was to start a new business today, the odds of survival for the first two years are favorable with a 66% surviving and 35% failing. For businesses that make it to four years the numbers reverse with only 35% surviving and 65% failing. What do these numbers say when looking at a business that is two years old or if a business is four years old? This data should be considered when trying to determine the risk of starting a new business versus buying a business. Again, there are many other details to be considered when making a decision of this magnitude. This may contribute to answering one.

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