looking for advice from those who bought existing salons

SpaRookie · 03-21-2006, 12:33 PM

We are getting ready to draw up our list of "due diligence" before finalizing the purchase of the salon (27 beds).
We have a good listing of the financials and legals we need to examine more closely before making the contract binding.
My question is.....is there anything in particular that other buyers have found out "after the sale" that we should watch out for? Any due diligence advice anyone can offer would be greatly appreciated!

ramcat · 03-21-2006, 12:46 PM

Are the beds all working? Hours on lamps? Lamps need replacing? A/C adequate for building?

glowtanning530 · 03-21-2006, 12:47 PM

Packages. The previous owners took it upon themselves to sell one yr. Unlimted's at half price. I never signed anything agreeing to honor existings but what do you do? Make your existing clientele mad. It isn't their fault

Electric_Sun · 03-21-2006, 12:57 PM

^^ maybe prorate some $ back to you for those long term contracts.

glowtanning530 · 03-21-2006, 12:59 PM

Get it in writing before escrow starts....

Electric_Sun · 03-21-2006, 01:01 PM

also make sure all income numbers used by the owner are supported by income tax returns. Don't take their word that they 'pocketed' a lot of cash so it wasn't declared. There's no way to verify this so only use the documented numbers.

parrot head · 03-21-2006, 01:11 PM

If the numbers can't be verified, they don't exist. Been there, done that. I'm sure you've done this, but make sure there are no liens anywhere on anything.

mlc1121 · 03-21-2006, 03:27 PM

^^^Agree with everyone. Make sure you ask to see the numbers on the lamps and check out that AC to make sure it is working. The owner we were buying from failed to mention that the AC didnt work...good thing we found out before closing and we made him fix it. Also you should have an agreement that any monies he makes from packages he sells from now until closing date should be put into escrow and maybe split between the 2 of you. Good luck!! :)

mikejones · 03-21-2006, 03:49 PM

maybe not jump into such a huge setup? Start with a smaller place.

glowtanning530 · 03-21-2006, 04:08 PM

Yeah that is alot of beds!

03-21-2006, 12:33 PM	#1 (permalink)
SpaRookie Join Date: Mar 16 2006 Location: IL Posts: 7 Rep Power: 0	looking for advice from those who bought existing salons We are getting ready to draw up our list of "due diligence" before finalizing the purchase of the salon (27 beds). We have a good listing of the financials and legals we need to examine more closely before making the contract binding. My question is.....is there anything in particular that other buyers have found out "after the sale" that we should watch out for? Any due diligence advice anyone can offer would be greatly appreciated!

03-21-2006, 12:47 PM	#3 (permalink)
glowtanning530 Join Date: Jan 20 2006 Location: folding towels, cleaning beds, ordering lotions, fixing beds, etc. etc. etc. etc. etc. Age: 28 Posts: 1,136 Rep Power: 114	Re: looking for advice from those who bought existing salons Packages. The previous owners took it upon themselves to sell one yr. Unlimted's at half price. I never signed anything agreeing to honor existings but what do you do? Make your existing clientele mad. It isn't their fault

03-21-2006, 12:57 PM	#4 (permalink)
Electric_Sun Just chill out, will ya! Join Date: Feb 27 2006 Location: BFF Field Office #2 Posts: 587 Rep Power: 76	Re: looking for advice from those who bought existing salons ^^ maybe prorate some $ back to you for those long term contracts. __________________ Ban Virgin

03-21-2006, 12:59 PM	#5 (permalink)
glowtanning530 Join Date: Jan 20 2006 Location: folding towels, cleaning beds, ordering lotions, fixing beds, etc. etc. etc. etc. etc. Age: 28 Posts: 1,136 Rep Power: 114	Re: looking for advice from those who bought existing salons Get it in writing before escrow starts....

03-21-2006, 01:01 PM	#6 (permalink)
Electric_Sun Just chill out, will ya! Join Date: Feb 27 2006 Location: BFF Field Office #2 Posts: 587 Rep Power: 76	Re: looking for advice from those who bought existing salons also make sure all income numbers used by the owner are supported by income tax returns. Don't take their word that they 'pocketed' a lot of cash so it wasn't declared. There's no way to verify this so only use the documented numbers. __________________ Ban Virgin

03-21-2006, 01:11 PM	#7 (permalink)
parrot head Police Department Join Date: Jul 13 2004 Location: Menomonie, Wi. Age: 67 Posts: 1,369 Rep Power: 6	Re: looking for advice from those who bought existing salons If the numbers can't be verified, they don't exist. Been there, done that. I'm sure you've done this, but make sure there are no liens anywhere on anything.

03-21-2006, 03:27 PM	#8 (permalink)
mlc1121 Join Date: Oct 15 2005 Location: New York Age: 32 Posts: 240 Rep Power: 5	Re: looking for advice from those who bought existing salons ^^^Agree with everyone. Make sure you ask to see the numbers on the lamps and check out that AC to make sure it is working. The owner we were buying from failed to mention that the AC didnt work...good thing we found out before closing and we made him fix it. Also you should have an agreement that any monies he makes from packages he sells from now until closing date should be put into escrow and maybe split between the 2 of you. Good luck!! :) __________________ ~MELISSA~ Life Is Much Better When You're Tan!!

03-21-2006, 03:49 PM	#9 (permalink)
mikejones Join Date: Sep 30 2005 Posts: 649 Rep Power: 7	Re: looking for advice from those who bought existing salons maybe not jump into such a huge setup? Start with a smaller place. __________________ I need a dime that's top of the line Cute face slim waist wit a big behind

03-21-2006, 04:08 PM	#10 (permalink)
glowtanning530 Join Date: Jan 20 2006 Location: folding towels, cleaning beds, ordering lotions, fixing beds, etc. etc. etc. etc. etc. Age: 28 Posts: 1,136 Rep Power: 114	Re: looking for advice from those who bought existing salons Yeah that is alot of beds!

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