Ask an Expert: Job in danger? Maybe you can buy a business

— -- Q: I am pretty sure that I will lose my job. I don't want to start a business from scratch, so what do you think of buying a pre-existing business? And if that is a good idea like I think it is, what are the possibilities of getting the owner to finance the purchase? My credit isn't great. — Mike

A:As a general rule, buying a business can be a very good idea, but as with everything else in this economy, to make sure it will be a successful venture, you have to proceed with caution and do your due diligence.

First the pros: With a pre-existing business, you should have a pretty good idea of what you are getting. The business makes X number of dollars in profit a year, has Y number of customers, and so on. The kinks should mostly be ironed out and the brand already established. All good, that.

There are two potential pitfalls as I see it:

1. First, you have to make sure that the success of the business is not due to the current owner. If the customers, for instance, are his personally and not really those of the business, that is a red flag.

2. Similarly, you need to be extra certain, given the economic times we are in, that the business will remain as profitable as it has been in the last few years.

When it comes to buying a business, there are few people more knowledgably about the process — selecting, financing, etc. — than the folks over at BizBuySell.com. The site is one of the top marketplaces for businesses and franchises for sale. It lists everything from inexpensive home-based businesses to gas stations, large ventures, franchises, and more.

So to better answer your question, I called up Mike Handelsman, the general manager of BizBuySell.com and spoke with him.

Like any good business coach, he thinks you need to begin with the basics: "Start with a self analysis, decide what you are good at, figure out whether you are an entrepreneur" — aside: my book The Small Business Bible can help with that! — "and then start thinking about the sort of business that fits your interests and affords you the right type of income."