Listing ID: 77456
PRICE REDUCED FOR QUICK SALE! This is a unique opportunity to acquire a successful business (with Real Estate).
Note: Must sign NDA and show proof of down payment to get full detail on this business!
Sales Price: $6,695,000 Plus Inventory
Cash on Cash Return 21.69 %
Internal Rate of Return (IRR) 36.01 %
Capitalization Rate 10.53 %
Gross Rent Multiplier (GRM) 1.40
Debt-coverage Ratio (DCR) 2.06
Operating Expense Ratio (OER) 84.82 %
The financial information was supplied by the seller and has not been verified by the broker. The broker makes no representation about the accuracy or completeness of the information and does not guarantee future performance. It is the responsibility of a prospective buyer to make their own inspection of all financial and other business records and to seek independent financial and legal counsel regarding any purchase of this business and/or real estate.
All data, information including all measurements and calculations of area, is obtained from various sources and has not been, and will not be verified by the broker for accuracy. Properties or Businesses may or may not be listed by the office/agent presenting the information.
- Asking Price: $6,695,000
- Cash Flow: $700,000
- Gross Revenue: $4,600,000
- EBITDA: $700,000
- FF&E: N/A
- Inventory: N/A
- Inventory Included: N/A
- Established: N/A
- Property Owned or Leased:Own
- Property Included:Yes
- Building Square Footage:N/A
- Lot Size:N/A
- Total Number of Employees:N/A
- Furniture, Fixtures and Equipment:N/A
Why is the Current Owner Selling The Business?
There are all kinds of reasons why individuals choose to sell companies. Nonetheless, the true reason vs the one they say to you may be 2 totally different things. For instance, they might state "I have too many various responsibilities" or "I am retiring". For many sellers, these reasons are valid. However, for some, these may simply be justifications to attempt to conceal the reality of changing demographics, increased competition, current reduction in profits, or an array of various other reasons. This is why it is really crucial that you not count completely on a vendor's word, however instead, utilize the vendor's answer combined with your general due diligence. This will paint a more sensible picture of the business's present situation.
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. Lots of companies finance loans with the purpose of covering items such as inventory, payroll, accounts payable, and so on. Remember that in some cases this can suggest that earnings margins are too thin. Many organisations come under a revolving door of taking loans as a way to pay back various other loans. In addition to debts, there may also be future commitments to consider. There may be an outstanding lease on equipment or the building where the business resides. The business might have existing contracts with vendors that must be satisfied or may result in penalties if canceled early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do businesses in the area attract new customers? Often times, businesses have repeat clients, which develop the core of their day-to-day revenues. Particular aspects such as new competitors growing up around the area, roadway building and construction, as well as employee turn over can influence repeat clients as well as adversely affect future earnings. One important thing to take into consideration is the placement of the business. Is it in a highly trafficked shopping center, or is it hidden from the highway? Clearly, the more people that see the business often, the better the opportunity to construct a returning customer base. A final thought is the general area demographics. Is the business situated in a densely populated city, or is it situated on the edge of town? Exactly how might the neighborhood average house income effect future income potential?