Starting your own business from scratch involves money, time and considerable uncertainty. Buying an existing business can remove many of the unknowns. The "buy versus make" decision evaluates many factors of potential value that are embodied in "Goodwill" including:
- An established customer base
- A recognized company name
- A trained workforce
- In-place information systems
- Existing business processes and procedures
- Intellectual property such as patents and copyrights
- A developed base of vendors and key relationships
- Physical facilities with in place operating equipment
- A company performance record, both financial and operational
These factors must be investigated to asses the strength of the company's competitive position and the relative barriers to market entry.