I finally found a small business forum! Glad to be here. My wife and I will be leaving the Army (currently in GA) next year and move back to TX. I planned on buying a business once we got there. However, I was surfing a site that lists business' for sale and found one that I am interested in. It is a towing company with management in place. Seems the owner is absentee and leave most of the day to day operations to the manager. He is offering 100% (think with part SBA loan) and that makes me think this is a solid co. if the owner is willing to finance a large part of the business. I want to purchase this business but need advise on the how to work the long distance. I am thinking of asking the seller since I think that's what he is doing now.

1. I would not buy a business without seeing it.
2. It's just business paperwork it can be done long distance
thats how global business works. Most transactions will be taken care of by other title management, bank, lawyer etc.
3. Read carefully before you sign.

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First, thanks for your service! Our military has a challenging daunting and long term task before it - eradication of terrorists.

Towing biz are often state regulated. Transfer of those permits are a challenge. Palm greasing mean anything?

Without knowing your background, accurate answers are tough. You will need legal counsel and/or CPA counsel before you do a deal. Structure of purchase and sale agreements establish how you operate for now on - if you don't have the time to do it right the first time, what makes us think we will the second?

Study both the biz and your temperment. Are they compatible? Is the biz real? What are you missing? New tow trucks cost up to $60,000. What state of repair are the ones being sold? Owned or leased? Etc. Etc. More questions than could possibly be covered on a forum.

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Good Luck and Good Selling!
John Slenes, MBA
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In my 20+ years experience dealing in business sales, I consistently advise my business buyers that there is really No Absentee Business. You are going to invest a lot of money in the venture and need to dilligently watch over it.

This type of business typically has a portion of its revenues in "Cash." This is very hard for an absentee owner to monitor and audit.

Good luck.

I would carefully look at any towing business. It can be a nightmare from an absentee owner standpoint.

Just ask Bill Miller and the stock holders of Miller Industries in Chattanooga TN. They hold a hugh market share of the tow industry, they make holems tow trucks and many other well know brands.

They got the bright idea a few years back to build a nationwide towing company so they bought up a bunch of local tow company across the country. They would buy them and leave the current owners there to run the local company. Problem with that is that towing is a mostly cash business. The old owners would tow a car and someone would pay them cash and it went into their pocket. This almost sent Miller into chapter 11 before they unloaded Roadone.

Point being it is hard to control a cash business if you are not there to keep a close eye on it.

Thanks
Mark

The 'red flag' for me is why any business owner would offer 100% financing? If the business is doing well, a buyer would have no problem getting bank financing. If I sell you a business that is failing badly, and provide 100% financing, where is my risk? None. The business is worthless in the first place, and now you have just agreed to pay me $***,*** for this business. You are on the hook to pay me, regardless of the condition of the business. The very first thing I would do would be to ask for audited financial statments and tax returns for the past three years. Then decide if this is something you want to do.

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Gordon