From the outset, we must sadly assume that everyone selling a business is economical with the truth. The majority of people don’t lie, but they have a wonderful habit of omitting the problems that you need to know.
The licensed industry is one of the worst educationally informed professions, it has for years evolved on the principle that you buy a business, have some rudimentary instruction by the person selling the business and then find out how it really works. There is also the continual belief that you can actually run the business better than the present owner. A large number of people look at possibly an overweight, jovial or miserable as the case may be proprietor with a glass in his hand chatting to a customer or wandering round the business apparently aimlessly and assume that they have to be able to improve on his or hers performance. He may well have water or a soft drink in the glass; his eyes are everywhere checking his customers, the service and a myriad of other things to make the business tick. He could of course have a large whisky and be exactly what he looks like – I have always preferred to be the former.
The reason for the industry being the least technically educated is that you can take a one day course, obtain a license and immediately take over a business with no previous experience, your only requirement being that you satisfy the Police that you do not have a criminal record. If like any other profession a licensee had to undergo three years training and study before they could obtain a licence we would not have the failure rate that we do. The failure rate is exacerbated by a large number of would be licensees buying businesses that have no serious chance of survival and their inability to recognise this fact, through lack of knowledge and insufficient experience.
I met the then Chairman of one of the Commercial Agents organisations at a meeting some years ago and suggested that we at least tried to make would be buyers better informed. He immediately said it was not in their interests to do so, because it would slow up the selling of businesses if people were more successful and kept their businesses longer. The consistent failure rate provides a constant flow of businesses for them to sell. He’s right from his side, but irresponsible from the would be buyers side. Many of us would like to see this attitude change, but it won’t happen unless people buying businesses are better informed.