Mabelmae1968

Okay, I have an opportunity to purchase a salon in town. It has been in business 5 years and is a combo tanning, mani/pedicures and hair salon. It is beautifully done and is making money. Equipment all paid for and all stylists manicurists have a signed lease which the owner gets $2000 a month from them. It is 2800 square feet, 8 ergoline beds 1 hand held spray tan . Also, 1 room built out for massage or facialist or whatever. The rent alone is $4200 not to mention other overhead. The build out cost $80,ooo and the equipment $62, 000 5 years ago. The current owners are wonderful people but they will tell you they haven't spent anytime advertising. Any advice will be helpfull. Thanks

MATT A

How do you know it's making money?

navigatin1

The owners told him/her so. Duh.

Mabelmae1968

I have seen there financials and I had the opportunity to sit in the salon on 2 seperate occassions and learn there software and meet some of there customers. I am dealing with a husband/wife. I have spoken to the landlord he has given me his opinion on the salon. He has mentioned he would consider a rent reduction if I exstend the current lease which is up Aug. 2011. Not sure about that yet. They have a great reputation there really isn't a whole bunch i would change at first. They are just ready to move on. There daughter just moved back home and has a 6month old baby and they take care of the child for her...at the salon. Anyway, any thoughts on what i may be missing? I have opened a business but never bought an exsiting one. Navigatin1 I love your picture!!

dnjplus6

If you just just started looking into this Biz since you joined TanTalk, WAIT. LOts to learn !

Mabelmae1968

Actually, I have a full service salon already (5 years in business) about 15 miles away from the one I am looking at. I always wanted to expand more into the tanning part(i have 2 beds now) in my current salon. This other salon is much larger and like I said earlier has 8 beds. The area of my current salon is in a different county and is a bit more saturated with tan/massage, etc. I love the tanning part of my current business, I have to say seeing all the tanning salons going under on craigslist and here makes me nervous, but the salon isn't just tanning so I feel better about it. I guess I am just afraid because on the tan tax and slow season here. I see you joined this year dnjplus6, what is your situation and what have you learned since joining?

Michelle N

You saw their financials? Does that include their bank statements, their tax returns for the past several years or just a spreadsheet that they made up for you?

jkonturas

Plain and simple..... right now is not the time to be buying a tanning salon. Id wait, and instead, maybe upgrade what you have to some VHR machines. Say a 12 min bed, and a 9 min Booth.... You can charge more, tan more people, and be more aggressive.... Also, I have owned my salon for 7 years now. Opened it from scratch, and now Im doing very well. I see "combo" salons all the time, and they never will do as well as an exclusive tanning salon. Just keep that in mind..... If your only gettin 2K from stylists, and still need to come up with 2,200 on your end of the "combo"... Id pass... Why not just open a kick arse tanning salon (exclusively tanning) for the same price? You would fare alot better IMO

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Mabelmae1968

Lots of good advice, thanks! Did I mention they are asking $20,000?

Marie713

Are they showing a profit on their tax returns? If you look at their software are they on track to gross the same this year as last?

Something else you should do is ask for their profit/loss. This will help you have an idea of utilities and other expenses. Make sure that what they wrote off makes sense. Don't let them BS you by saying they take out cash or write of more than they should. All you can go by is their tax returns.

That rent is frightening.

It seems like they put a lot of money into it to only be asking 20K.