Listing ID: 70079
Major Sub franchisee looking to retire after a long time in business is looking to sell all 11 stores in and around this large Central Illinois then. Prime locations. Management in place. 6 (soon to be 7) of these stores have real estate that can be purchased. All others are in leased space. Half have drive thru windows. Ownership would consider breaking the stores into 2 packages, selling real estate owned or any other combination that makes sense. They will not sell stores individually. These stores gross over $3MM per year in sales.
- Asking Price: $2,250,000
- Cash Flow: N/A
- Gross Revenue: $3,000,000
- EBITDA: N/A
- FF&E: N/A
- Inventory: N/A
- Inventory Included: N/A
- Established: N/A
Why is the Current Owner Selling The Business?
There are all kinds of reasons people decide to sell companies. However, the true factor and the one they tell you might be 2 entirely different things. As an example, they might say "I have way too many various obligations" or "I am retiring". For lots of sellers, these reasons are valid. But, for some, these might just be justifications to attempt to hide the reality of altering demographics, increased competition, current decrease in profits, or a range of other factors. This is why it is very important that you not rely entirely on a vendor's word, however instead, use the seller's response in conjunction with your total due diligence. This will repaint a more sensible picture of the business's current circumstance.
Existing Debts and Future Obligations
If the current company is in debt, which many businesses are, then you will certainly have reason to consider this when valuating/preparing your offer. Many companies finance loans with the purpose of covering points like stock, payroll, accounts payable, and so on. Remember that in some cases this can mean that profit margins are too tight. Numerous organisations come under a revolving door of taking on debt as a way to pay back other loans. Along with debts, there may additionally be future obligations to think about. There might be an outstanding lease on tools or the building where the business resides. The business may have existing contracts with suppliers that should be fulfilled or might lead to penalties if terminated early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do businesses in the area bring in brand-new consumers? Many times, businesses have repeat clients, which develop the core of their everyday revenues. Particular factors such as brand-new competitors growing up around the location, road building and construction, as well as staff turnover can affect repeat clients and adversely influence future revenues. One essential thing to think about is the area of the business. Is it in a highly trafficked shopping mall, or is it hidden from the highway? Certainly, the more individuals that see the business on a regular basis, the higher the possibility to develop a returning customer base. A last thought is the general location demographics. Is the business situated in a densely populated city, or is it situated on the outside border of town? Just how might the neighborhood typical house income impact future revenue potential?