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Is it wise to buy a business to just for the location / lease?

I am thinking of buying a business just for its location. I plan to close the existing business and start a new one. Does is make sense to buy a business and pay premium just for a good location?

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The BAF Group LLC

We have seen this done, but rarely. You have to ask yourself the most fundamental question you would, if you were going to operate the current business: At the price you pay, how long would it take you to overcome the investment?

In addition, are there no other locations that would meet your need, without paying that premium? What makes this particular location so attractive, compared to others you might consider? Why is the current business being sold? Is it making a profit - and if no, why not? Does it have anything to do with the location?

Yes, it CAN make some sense - but you REALLY have to analyze the pros and cons, before committing to it.

Jan 24, 2016

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