wendycity

I am looking into buying two existing salons that are currently for sale. I know there is alot more information that we need to obtain, as we are in the beginning stages.

Here is some of the info that I do have:

-Asking price is $370,000.00 total for 2 salons in 2 different cities.
-Both salons are in leased strip mall space.
-Salon A has approx 20 beds, Salon B has approx 15 beds.
-Owner has owned the salons since 1990 and I believe they are part of a franchise.
-Per the Quickbooks income statement (which yes I realize is likely inaccurate and not final) the gross income is $510,000.00 per year for the 2 combined. Net profit before taxes and depreciation is $160,000.00.

Salon A is actually the place where I currently tan. It is located right next to campus in a college town. December through March there is usually a 10-30 minute wait to tan for the better part of the day. The town is about 20k people and college adds an additional 17k. There are only 2 salons of this caliber in the town (including this one), with a few other smaller salons. Salon B is in another larger city, but I am unfamiliar with the salon itself. It pulls a similar profit as Salon A.

My current occupation is office management for a $2.5 million/yr company so I am quite familiar with how to run a business. This venture would be myself and a partner.

My questions:

1. Do you feel that this asking price is accurate? If not, what would be an acceptable offer?
2. Assuming there is a manager employed at the salon (I believe there is one that runs both...again I need to check on alot of things)...how much time is going to be involved with myself and my partner? How involved in the business will we actually be? The current owner lives 2 hours away from the salons, so I believe that he doesn't play a very active roll.
3. I realize that I need to get a detailed account of the equipment, but in general, how often should I expect to replace beds?
4. Am I going to be way in over my head here? I have a strong business sense and my partner is an accountant. We know the basics about tanning but nothing too in depth. I am a very quick learner though, and am determined to succeed. F'real - don't laugh! ;)

Thank you very much for any help and/or insight you may have. Again, I realize that I do not have alot of the necessary information as I am just in the beginning stages.

Wendy

caribbean tan man

wheather or not they are a franchise is a huge factor and you shouldnt go any further till you find this out....franchises have fees/royalties on top of the purhase price.

__________________
someone PM me when a good tanning topic is posted. :lol:

eyecandytanning

Be wary of having a partner. I have a co-owner and he was supposed to help with the business since he too is an accountant. Well I have not heard from him in almost a year and I am stuck running the business full time while he gets to reap the benifits of it and there is nothing I can do about it. He did absolutley nothing for the business after signing the papers.

Steve Underhill

Please send me an email and I will send you a questionnaire for the salon owner to fill out that will me to determine the purchase value.

navigatin1

Listen to that guy! /\/\/\/\/\/\/\

excitednewguy

WOW, what a concept! All you have to do is have someone fill out a questionnaire to determine the value of a business? Does this work with all businesses?

Next time I purchase a business or sell one of mine, I will be sure to have this filled out so that I can get top dollar!

Steve Underhill

You can throw something at the wall and hope it sticks or you can generate real answers by knowing what questions to ask. What is a business worth? There is what the owner thinks it is worth and there is what you can actually buy it for. In order to determine what that number is there are some questions that you can ask that will help you determine that. Are the questions I ask going to kick out a number that becomes the price that you can buy it at? Not necessarily, however it will generate the number that it is worth.

Dr. Woo

May i have a copy of that questionaire Thank you

Platinum Tanz

for that much money i would open my own salon's that way you don't have to deal with someone elses junk or problems.