Buying a Business: Can a Private Individual Purchase a Business Without Being a Professional?
Buying a business can be a great opportunity for individuals who want to embark on the entrepreneurial journey. But one question remains: can a private individual buy a business without being a professional or merchant? In this article, we’ll explore the conditions, steps, and available support to carry out this operation. Our goal: to provide you with a clear, complete, and practical answer.
What Is a Business?
A business (or “fonds de commerce” in French law) is a collection of elements that allow the operation of a commercial activity. It should not be confused with the physical commercial premises (known as “commercial property”) or with the company or legal entity operating the business.
The Components of a Business
A business includes:
tangible assets such as equipment and furniture,
intangible assets such as clientele, trade name, signage, lease rights, licenses, and administrative authorizations, and sometimes intellectual property.
These elements are essential to operating the business but do not include real estate, debts, or receivables.
Difference Between Business and Other Notions
It’s important to distinguish between:
the commercial goodwill (fonds commercial), which is an accounting concept,
the commercial lease, which is a rental contract for the premises,
and the business (fonds de commerce), which includes all the operational means.
The business can be sold, leased, or transferred. It is transferred via a notarized or private contract.
Can a Private Individual Buy a Business?
Yes, a private individual can absolutely purchase a business, provided they comply with certain legal obligations and choose an appropriate legal status. You don’t need to be a merchant beforehand, but you must become an operator.
Legal Conditions for a Private Individual
A private individual must:
be of legal age and have legal capacity,
register with the Trade and Companies Register (RCS),
declare their activity and meet fiscal and social obligations,
choose a status as a merchant or sole proprietor.
This process entails civil responsibilities and legal commitments.
Choosing a Legal Status
The individual will need to set up a structure:
a sole proprietorship, including under the micro-entrepreneur scheme. Caution: this simplified regime may limit borrowing capacity and the ability to resell the business,
or a single-member company such as an EURL or SASU, which offer more flexibility for financing and transferring the business.
Each status has its advantages in terms of taxes, personal asset protection, and social contributions. Getting advice from an expert is recommended to make the right choice.
Advantages and Disadvantages for a Private Individual
Buying a business as a private individual offers tangible benefits, but also some risks to be anticipated.
Advantages of Buying a Business
Buying a business brings several benefits:
a turnkey operation,
an already loyal customer base,
trained employees,
a strategic location,
an existing supplier network.
This allows for a faster ramp-up, quicker revenue generation, and a higher probability of business continuity: in fact, businesses acquired tend to survive longer than those started from scratch.
Disadvantages and Precautions
However, the operation carries risks, such as an overvalued price or poor assessment of commercial potential. To reduce these uncertainties, it is essential to conduct a thorough due diligence and seek proper legal guidance. These steps help secure the purchase both legally and financially. A solid financing plan and thorough preparation are also key.
Key Steps in the Acquisition Process
Buying a business involves specific steps that must be carefully followed to ensure a secure transaction.
Preparation and Research
Before buying, you should:
define your business sector,
choose a geographical area,
determine your budget and selection criteria,
consider seeking professional advice.
Finalizing the Purchase
The steps include:
negotiating the price,
signing a preliminary sales agreement,
conducting a business audit,
signing the deed of transfer,
completing tax formalities, including filing the deed with the tax office (SIE),
publishing the sale in a legal notice journal,
registering with the RCS.
Financing and Available Support
Buying a business often requires external financing. Fortunately, several solutions are available.
Financing Options
Available options include:
professional loans,
leasing or lease-purchase,
microcredit,
crowdfunding,
love money,
business angels.
A personal contribution remains essential.
Support and Assistance Programs
Numerous forms of support exist:
ACRE (Aid for Business Creation or Takeover),
NACRE (support and interest-free loan),
assistance from Pôle Emploi for unemployed entrepreneurs,
Bpifrance, regional councils, chambers of commerce,
support networks such as Initiative France and France Active.
Conclusion
A private individual can legally buy a business, and the process is regulated. With the right preparation, appropriate support, and solid financing, this project can be successfully realized.
Key takeaways:
A private individual can buy a business with the right legal status.
The operation requires serious analysis and preparation.
Choosing a legal status protects personal assets.
Professional support is crucial.
Numerous support schemes are available.
Need help evaluating a business or finding opportunities in your area? Contact an Optimhome advisor for local expertise and personalized guidance on your entrepreneurial journey.
FAQ
Can a private individual buy a business without creating a company?
Yes, via a sole proprietorship, but this involves unlimited liability.
What are the main risks?
Overvaluation of the business, poor location, or unstable customer base.
Is a personal financial contribution necessary?
Yes, a personal contribution is generally required to strengthen the application and make financing more accessible. However, it can be supplemented with alternative financing sources.
What support is available?
ACRE, NACRE, honor loans, regional support programs, and Bpifrance initiatives.
Is it necessary to be supported?
Yes, to secure the purchase, assess the business, and choose the appropriate legal structure.
Author:
Bernard Schustermann – Head of the Retail & Business Division
With 20 years of experience in the real estate sector and dedicated expertise in the Retail and Business division, my goal is to share practical information and in-depth analysis to help every professional make the best decisions for their real estate projects. Because a well-thought-out project is a successful one.
