Listing ID: 77387
Listing # – 5167 JH
* International Franchise Tea & Boba Shop
* Located inside a shopping center with lots of shops and restaurants
* Absentee Run, potential to grow business with owner-operator
* Low Rent and Long lease
* Build out cost $400K plus
* High Net
* Prime Location
- Asking Price: $489,000
- Cash Flow: $120,000
- Gross Revenue: $420,000
- EBITDA: N/A
- FF&E: $150,000
- Inventory: $20,000
- Inventory Included: N/A
- Established: 2017
- Property Owned or Leased:N/A
- Property Included:N/A
- Building Square Footage:950
- Lot Size:N/A
- Total Number of Employees:12
- Furniture, Fixtures and Equipment:N/A
The business was founded in 2017, making the business 5 years old.
The deal doesn't include inventory valued at $20,000*, which ins't included in the suggested price.
The company has 12 employees and is situated in a building with disclosed square footage of 950 sq ft.
The building is leased by the company for $4,500 per Month
Why is the Current Owner Selling The Business?
There are all kinds of reasons people decide to sell businesses. However, the genuine factor and the one they tell you may be 2 totally different things. For instance, they may say "I have a lot of various responsibilities" or "I am retiring". For numerous sellers, these factors stand. But also, for some, these might just be excuses to try to conceal the reality of altering demographics, increased competition, recent reduction in incomes, or a variety of other factors. This is why it is really essential that you not depend totally on a seller's word, but rather, utilize the vendor's response in conjunction with your general due diligence. This will repaint a more practical picture of the business's existing scenario.
Existing Debts and Future Obligations
If the current company is in debt, which lots of businesses are, then you will need to consider this when valuating/preparing your offer. Many operating businesses borrow money in order to cover things such as supplies, payroll, accounts payable, so on and so forth. Remember that occasionally this can mean that earnings margins are too thin. Numerous businesses fall into a revolving door of taking loans as a way to pay back other loans. Along with debts, there may also be future commitments to consider. There may be an outstanding lease on tools or the building where the business resides. The business might have existing agreements with vendors that should be met or may cause charges if canceled early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do companies in the location attract new clients? Most times, companies have repeat consumers, which create the core of their day-to-day revenues. Certain factors such as new competition growing up around the area, roadway construction, and employee turnover can impact repeat clients and also adversely influence future incomes. One vital point to take into consideration is the location of the business. Is it in a very trafficked shopping center, or is it concealed from the main road? Certainly, the more individuals that see the business on a regular basis, the higher the opportunity to build a returning consumer base. A last thought is the general location demographics. Is the business situated in a densely populated city, or is it located on the edge of town? How might the neighborhood mean house income influence future earnings potential?