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Old 02-21-2012, 12:25 PM   #1 (permalink)
 
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Question Help with salon value!!!

Hello,

I am interested in buying a tanning salon in PA. The seller is asking $25k but her income tax return shows about 25500, but she flat out told me she takes almost all cash out and she took home $20k cash last year. She has been in business for 12 years.

She has 4 beds.
1 & 2.) 2 Wolfe beds that are 12 years old. One is a Sunstar zx30 3f
the other Wolfe is a stand up

3.) Mega Sun which is 8 years old (stand up)

4.) Ovation which is 5 years old and has 32 bulbs.

These beds are in perfect shape.
She does have all kinds of lotion and she was getting another shipment in today.


Should I be weiry of this? Her hours right now are very small, M-F 10-6 and Saturday 10-1. There are 15 salons in the area, this includes hair salons with tanning. Most are small but there are two that are very large.

If I were to purchase this salon I would extend the hours first thing.


HELP please!! I know this isn't a large amount of money, but still.
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Old 02-21-2012, 01:29 PM   #2 (permalink)
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Re: Help with salon value!!!

How much is she grossing?
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Old 02-21-2012, 01:34 PM   #3 (permalink)
 
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Re: Help with salon value!!!

She is saying on paper it is $25k. She doesn't keep very good records, which scares me. Just as I previously stated, she told me she took out almost all cash for herself which is an additional $20k. She doesn't have a computer system but does us a T-max timer system. She can only give me her income tax amount.
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Old 02-21-2012, 01:58 PM   #4 (permalink)
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Re: Help with salon value!!!

How much is the rent?

Is there room to do anything else there beside offer 4 tanning beds? (other services, products, another business,...). How many amps of electrical service is there and how many tons of HVAC?


Would you be working the salon yourself? If so, would you have to be quitting an existing job to work here instead?
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Old 02-21-2012, 02:14 PM   #5 (permalink)
 
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Re: Help with salon value!!!

Quote:
Originally Posted by sunsally View Post
How much is the rent?

Is there room to do anything else there beside offer 4 tanning beds? (other services, products, another business,...). How many amps of electrical service is there and how many tons of HVAC?


Would you be working the salon yourself? If so, would you have to be quitting an existing job to work here instead?
The rent is $600 a month. The landlord pays water and sewage.
There is room for one more bed. Everything is on 220amps. Two of the bed have 160 watts other two are 100 watts.
The previous owner has 5 window AC units, which is not my preference.

I would be working at the salon 2 days during the week and Saturday and Sunday. I do currently have a full time position, that I am not looking to leave, but the company I work for is on rocky ground so to be honest it is just a matter of time. If the company I am currently employeed with goes under, I would work there full time.
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Old 02-21-2012, 02:45 PM   #6 (permalink)
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Re: Help with salon value!!!

RUN!!!!!!!!!
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Old 02-21-2012, 03:55 PM   #7 (permalink)
 
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Re: Help with salon value!!!

Quote:
Originally Posted by Brian Oshman View Post
RUN!!!!!!!!!
Hi Brian,

Can I ask why? I appreciate your response but just want a reason.


Thanks!
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Old 02-21-2012, 04:08 PM   #8 (permalink)
 
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Re: Help with salon value!!!

Just stopped in.. she is open from 10-6 right now. She had 18 scheduled appts today. I was there for about 20 mins and she had 4 walk in.

She said that this is normal and has 35 monthly packages as of right now. She said that things will start picking up March, at that point she requires appointments.

She has an okay amount of lotion, but it is not marked up to what suggested retail is.
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Old 02-21-2012, 04:10 PM   #9 (permalink)
 
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Re: Help with salon value!!!

oh ya... and she has never advertised. And I can believe that, because I have lived in the area my entire life and have never seen any advertisment.

I used to tan there it has been about 4 or 5 years, at that time I loved it. It was very busy and I got really good color.
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Old 02-21-2012, 05:48 PM   #10 (permalink)
 
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Re: Help with salon value!!!

you'd be better off opening your own salon and having better equipment. 25k for what? the beds are worth nothing. there's not enough clients to be perceived as value. just wait til a salon close's...go in and start paying rents...you'd have the build out all done and just need new beds and pc.
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