What is a buy proposal?

<span data-sheets-value="{"1":2,"2":"A buy proposal, also known as a “buy a business” proposal, is a document which indicates the desire of a company/investor to buy another company. It’s a brief document that is structured like a letter, and it includes details about the sender company and the best way to communicate with them."}" data-sheets-userformat="{"2":15105,"3":{"1":0},"11":4,"12":0,"14":{"1":2,"2":0},"15":"Montserrat","16":5}">A buy proposal, also known as a “buy a business” proposal, is a document which indicates the desire of a company/investor to buy another company. It’s a brief document that is structured like a letter, and it includes details about the sender company and the best way to communicate with them.

What does it mean to buy an existing business?

<span data-sheets-value="{"1":2,"2":"Many business people/investors look to buy existing businesses because they see a potential for growth and because these businesses already have a steady customer base and an excellent product/service. To purchase these businesses, they send a buy a business proposal or a letter of intent."}" data-sheets-userformat="{"2":15105,"3":{"1":0},"11":4,"12":0,"14":{"1":2,"2":0},"15":"Montserrat","16":5}">Many business people/investors look to buy existing businesses because they see a potential for growth and because these businesses already have a steady customer base and an excellent product/service. To purchase these businesses, they send a buy a business proposal or a letter of intent.

How do I properly propose purchasing a business?

<span data-sheets-value="{"1":2,"2":"To purchase a business, you must first communicate your intentions through a letter of intent (LOI) or a buy a business proposal. Both documents contain information about you, your intent of buying, and the reason(s) you'd like to buy the business. You can go one step further and mention a price too. However, more often than not, that's discussed later."}" data-sheets-userformat="{"2":15105,"3":{"1":0},"11":4,"12":0,"14":{"1":2,"2":0},"15":"Montserrat","16":5}">To purchase a business, you must first communicate your intentions through a letter of intent (LOI) or a buy a business proposal. Both documents contain information about you, your intent of buying, and the reason(s) you’d like to buy the business. You can go one step further and mention a price too. However, more often than not, that’s discussed later.

Proposal to Purchase Business Template

Prepared by: [Sender.FirstName][Sender.LastName] [Sender.Company]

Prepared for: [Client.FirstName][Client.LastName] [Client.Company]

Cover Letter

Dear [Client.Company],

This is [Sender.FirstName][Sender.LastName], and I am the [Sender.Title] at [Sender.Company], a business acquisition firm. It’s a pleasure to make your acquaintance!

[Sender.Company] is always on the lookout to partner with or acquire small businesses or business ideas that show vast potential, are ripe for improvement, or those that set out to solve a particular problem.

Your business, (insert client’s business’ legal name), caught our attention these past (X) months. Since then, we have noticed an upward trend of growth, and we see major room for improvement and development in the future.

With that being said, [Sender.Company] would like to discuss buying [Client.Company], either partially or fully. The following proposal contains our offer and has everything you need to know about [Sender.Company].

Please consider this written proposal as a formal letter of intent/offer letter. If you accept our proposal, we will begin to discuss the details of the business sale and the business plan with the respective business owners.

We look forward to hearing back from you!

Regards,

[Sender.FirstName][Sender.LastName][Sender.Company]

About Us

[Sender.Company] was established in (Year), with the aim of helping small businesses grow and reach their potential. Over the years, we have shifted operations, and we now also own a subsidy through which we buy existing businesses that show growth potential.

[Sender.Company]’s aim has always been to protect the mission and vision of the people that created a particular brand — the only difference we make is in strategy. With over (X)+ years of industry experience working with small businesses and startups, we are confident that we understand the likes and dislikes of the target demographic that buy from these brands.

At the present moment, we only purchase businesses in the (insert details) niche, since most of our experience stems from that industry.

For any questions or inquiries, please feel free to reach us at [Sender.Phone] or [Sender.Email].

Our Portfolio

In the (name of niche) industry, we have an impressive list of notable names in our portfolio. These names include, but are not limited to:

Insert name and address of the business.
Insert name and address of the business.
Insert name and address of the business.

Our Offer

Our current offer stands at $ (X). This payment can be made as a one-time fee or through installments, whichever option is most preferred by [Client.Company]. We are also open to the possibility of negotiating the offer with the business owners, either through direct negotiations or by having a lawyer conduct the proceedings.

The final offer includes all parts of your business, including your business name, all future profits and losses, copyrights, trademarks, patents, licenses, real estate, contact information, agreements, etc.

Requirements From Your End

To take this offer further, we require the following details from [Client.Company]:

Company valuation from an unbiased auditor.
Information on outstanding debt and liabilities.
Information on payment for current employees.
Data on all other monthly and annual costs.
Income statements.
P&L statements from the last five years.
Business plan.
Information on the type of business and registration details.

Terms and Conditions of the Agreement

[Sender.Company] has the right to rescind the offer if the valuation of the company is found to be untrue during the process of finalizing the agreement.
[Client.Company] agrees that they’re not allowed to use the contact details of any business stakeholders and are also not allowed to create a similar business in the next five years.
[Client.Company] agrees not to poach any stakeholders, be it past or current employees or customers.
[Client.Company] and [Sender.Company] both agree for there to be a transfer in ownership only if the offer price is agreed upon by both parties, and the conditions of the agreement are met. This proposal only serves as a preliminary document, and other contracts, which will be legally binding, will be drawn up at a later date once both parties reach an agreement.
If there are any disagreements arising from the settlement, both parties have the right to take matters to court, and all proceedings will be based on [Sender.Company]’s local laws and jurisdiction.
Once the negotiations begin, [Client.Company] agrees that they will not enter into a negotiation with other parties, specifically any competitors of [Sender.Company].
If [Client.Company] wishes to agree to this offer, they will need to send a signed copy of the contract within 14 business days from when the proposal is sent. If they wish to arrange a negotiation, they will need to show an indication of the same to [Sender.Company] via email within 14 business days. [Sender.Company] will then respond by email to ask for a review within this timeline. If no emails from [Client.Company] are answered, and no indication is given within 14 business days, it is to be assumed that [Sender.Company] has rescinded their offer.

Acceptance and Signatures

Please indicate that you agree to enter negotiations to discuss the final contract by signing the document.

Signature

MM / DD / YYYY