Monday, 9 November 2015

Is It The Right Time To Buy A Business In India?

India is expected to have the fastest GDP growth rate among emerging markets, beating even China if it grows by 7-8 percent per year. Interestingly, the SME sector in India has been outperforming with an even better growth rate of 10 percent per year. With the government’s focus on development and reforms this is expected to further increase. According to an E&Y 2015 survey taken from 505 “global decision makers” earlier this year, 62% said that they are looking to either enter the Indian market or are planning to expand their business. In fact, FDI in manufacturing has increased by a staggering 221% from January-June of this year. NRI deposits in the country has increased by 48% during the first few months of 2015. This makes it the right time to be in business in the India. 

Yet, it’s not easy to start a business from scratch because of the complexities involved in setting up a business. India ranks at a dismal 155th position among 189 nations in ease of starting a business. What is one of the most deterring factors when it comes to starting a new venture from scratch? Will your business idea find the traction you expect? Will it turn out to be as profitable? These are some of the questions that have to run through any realistic business owner’s mind.

There is one way to circumvent this problem. Instead of taking a huge risk and starting a business from scratch, you can simply buy an existing business available for sale. If not, you can even invest in a company which you are passionate about and get a stake in return and mould it the way you want. By doing this, you can inherit the goodwill that the company already has, along with the customers with whom relationships have already been made and get experienced staff and management who are passionate about the business. Since processes are already in place, you can start operations and start reaping the benefits from day one. Also, you do not have to bear the risk and costs of setting up the business.

You can enroll on secure online platforms which make introductions between business buyers seeking to buy a business and business owners / brokers who are seeking to sell a business. Most common opportunities include websites for sale, restaurants, bars and cafe for sale, IT companies for sale, commercial shops for sale, manufacturing factories for sale and even industrial properties for sale. Top locations where such deals are more prominent include Bangalore, Mumbai, Chennai, Delhi, Ahmedabad, Hyderabad, Pune, and other metros. Some websites also provides free guideline valuations so these opportunities are priced at fair valuations. Depending on the size of the business and industry, business takeovers are priced between 5 lakh rupees to 50 crore rupees and buyers can filter out opportunities as per their preference. If you are seeking to invest in India, partnering with sound SME businesses, which operate in industries which you are passionate about, is probably the best way to make an enriching investment.

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