buying a salon, is this a good opportunity? - tanTALK

caseyc · 09-09-2005, 11:50 PM

Hi - I am new to this forum. would like to get some inputs from the experts here.

I am interested in buying a salon in town. It's been serving a growing suburb 4.5 years. It has 12 beds with a Peacock Stand Up system and a Water Massage Bed. A New Spray tanning booth has just been added. 2004 Tower computer system, washer & dryer, CD player, nice decoration. The client list is over 4,500.

Asking price is $60K, cash flow $30K. It's currently close on Sunday. Owner doesn't do a whole lot of agressive marketing and promotion. I think it has the potential to grow..

Is it worth pursuing?
Thanks!

Ezliving_Jim · 09-10-2005, 12:05 AM

Not enought information to make a buying decision.

What were the annual sales for those 4 years?

Client database of 4500 is as good as a 2 year old phone book. How may clients tanned in May? 300-400, maybe.

How many sessions were served in May? In the last 12 months?

Competition within 3-5 miles?

Population within 3 miles?

What other equipment does he have? What kind of spray booth? If his premier equipment is a Peacock and a water massager, run, run, run away.

_________________
Jim

"Entrepreneur Extraordinaire Since 1953"

Read "Why Sunshine Is Good For You And Why Doctors Don't Want You To Know"
[ This Message was edited by: Ezliving_Jim on 2005-09-10 00:09 ]

sunsally · 09-10-2005, 08:28 AM

Agree - get more info. How much is the rent, are all the beds paid for (no leases to assume)?

Exactly WHAT equip does it have? Brands, specific pieces, years -- that will tell a lot about 'worth'.

See more specifics on the "cash flow". Did they bring in 150K, expenses were 120K and they made 30? Or brought in 75K and they're telling you they netted 30K. How much in payroll - were they "paying themselves" if they worked hours, or do you have to factor that out of the "profit".

$60K is pretty low -- lower than you can go build something, put in 12 beds, come up with 4500 addresses of known tanners, etc. So it COULD be a good opportunity. But need more info first to be sure!

West Side Tanner · 09-10-2005, 12:37 PM

Have YOU looked at the bank statements?

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09-10-2005, 12:05 AM	#2 (permalink)
Ezliving_Jim I love Derf!! Join Date: Mar 12 2002 Location: Undisclosed Secure Location Posts: 2,636 Rep Power: 26	Not enought information to make a buying decision. What were the annual sales for those 4 years? Client database of 4500 is as good as a 2 year old phone book. How may clients tanned in May? 300-400, maybe. How many sessions were served in May? In the last 12 months? Competition within 3-5 miles? Population within 3 miles? What other equipment does he have? What kind of spray booth? If his premier equipment is a Peacock and a water massager, run, run, run away. _________________ Jim "Entrepreneur Extraordinaire Since 1953" Read "Why Sunshine Is Good For You And Why Doctors Don't Want You To Know" [ This Message was edited by: Ezliving_Jim on 2005-09-10 00:09 ]

09-10-2005, 08:28 AM	#3 (permalink)
sunsally Team TanTalk Join Date: Nov 23 2004 Location: ITA Member & Berman Supporter! Posts: 3,136 Rep Power: 25	Agree - get more info. How much is the rent, are all the beds paid for (no leases to assume)? Exactly WHAT equip does it have? Brands, specific pieces, years -- that will tell a lot about 'worth'. See more specifics on the "cash flow". Did they bring in 150K, expenses were 120K and they made 30? Or brought in 75K and they're telling you they netted 30K. How much in payroll - were they "paying themselves" if they worked hours, or do you have to factor that out of the "profit". $60K is pretty low -- lower than you can go build something, put in 12 beds, come up with 4500 addresses of known tanners, etc. So it COULD be a good opportunity. But need more info first to be sure!

09-10-2005, 12:37 PM	#4 (permalink)
West Side Tanner Join Date: Dec 27 2003 Location: Florida Posts: 1,818 Rep Power: 21	Have YOU looked at the bank statements?

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