Anhil8tor Wrote:Owners of a 50+ year old business are considering retirement. Business has three convenient locations in growing markets. They each have excellent market share growth history, with a well-established customer base. Sales have grown steadily and are approaching 1.5M, with good cash flow. Qualified partes may email for more info...What's the catch? These people have no kids?
Flumper Barflusterbutt Wrote:What's the catch? These people have no kids?
Anhil8tor Wrote:guess not.... or their boy is gay and their daughter is working at the bunny ranch.I always wonder why people try to sell business that sound like such a good deal. Of course, anyone that owns a business must first work out their "exit strategy". That is one of the first things you do when you get started.
Anhil8tor Wrote:This thing had quite a few adds.. they make them all sound $$$ too. Now if this store has 3 locations that is a plus.. but I am suprised an employee won't take it.That's what makes me think that it isn't the great deal they portray. Usually they cook the books for the last couple of years to make it look like a good deal. Who knows though. I would say if it is something that a person really wants to do and the price of the business isn't much more than the cost of the necessary assets at their current value, the cost of the accounts receivable that are collectable, the cash that will be left in the bank, and whatever a fair price is for the current good will of the company, then it might be something to consider.
Flumper Barflusterbutt Wrote:That's what makes me think that it isn't the great deal they portray. Usually they cook the books for the last couple of years to make it look like a good deal. Who knows though. I would say if it is something that a person really wants to do and the price of the business isn't much more than the cost of the necessary assets at their current value, the cost of the accounts receivable that are collectable, the cash that will be left in the bank, and whatever a fair price is for the current good will of the company, then it might be something to consider.
I would weigh all that against what it would cost to get a loan and start an identical business.
leucetios Wrote:The nice thing with mom and pop business, is that if they are looking to retire you can probably pay them SOME cash down, and then have them finance it to you. It takes some negotiating, but in the long run taking, say 50k now, and then the financing to you at 6% makes them more money than having that cash in the bank would, and saves them some heavy taxes immediately. And some people looking to retire want some liquid cash to do stuff immediately, but then getting that nice 6% check (on say a 10 or 15 yr loan paying interest only or more) is pretty nice.Yes, but a lot of business owners have in mind what they think their business is worth. Often it is much more than what someone would be willing to pay. So, getting them to agree on a price can be difficult. I've even seen them hang on to the damn thing so long waiting on the right price that they let the business go to shit and then they practically have to give it away.
