Watching your first bloom can be a real confidence boost. Your hard work has paid off and you feel like everything you touch can turn to gold. Could this be the time to start looking at additional business acquisitions?

Before jumping into the next big adventure, now could be the time to slow down and take stock of your situation.

1. Your Financial Health

Purchasing another business will be a big investment. Do you have the financial means by way of savings? Consider the risk this could bring to your financial health if the new business goes south.

Would it be wiser to finance your new business so any struggles don’t drain your existing wealth? There are many questions to ask yourself regarding finances, but most importantly how do you fund the new business without taking from your existing business?

2. What’s Your Motivation?

Understand why you feel motivated to pursue other business acquisitions. It’s understandable if you have a lot of knowledge regarding the industry of the business and believe you could do it better. For many people, that’s reason enough to set sail toward new opportunities.

If you want to purchase a business simply because you enjoy a challenge, perhaps a better challenge would be growing the business you already have. That’s not saying pursuing a new challenge is wrong, but maybe you need to take some time to think about it.

3. Create a Mock Business Plan

Before you purchase another business, it can help to create a mock business plan. Obviously, this will take time and research, but it’s time you need to take a good hard look at where you can take your new business endeavor.

Be sure to include a marketing plan and a strategy for growth. Be realistic in setting milestones. As you build your plan, plan for the impact the time spent on the new business may have on your existing business.

Once your plan is complete, you’ll have a good idea as to whether or not purchasing an additional business is the right move for you.

Starting a successful business can be a moral booster. Perhaps you feel like you’re on top of the world. These feelings can lead to careless mistakes which is why you should take an appropriate amount of time to mull over any future business acquisitions. Some people do have the magic touch when it comes to creating successful businesses, but that touch comes with patience.