Listing ID: 82805
motel is doing average monthly
$18,000 to $20,000
total Expenses is $8000 to $ 10,000 month
- Asking Price: $550,000
- Cash Flow: $100,000
- Gross Revenue: $260,000
- EBITDA: N/A
- FF&E: N/A
- Inventory: N/A
- Inventory Included: Yes
- 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 sorts of reasons why people decide to sell businesses. Nonetheless, the genuine factor vs the one they say to you may be 2 entirely different things. For instance, they might say "I have way too many various responsibilities" or "I am retiring". For lots of sellers, these factors are valid. However, for some, these may simply be excuses to attempt to conceal the reality of changing demographics, increased competitors, current reduction in earnings, or an array of various other reasons. This is why it is extremely essential that you not rely entirely on a vendor's word, but instead, make use of the vendor's answer together with your overall due diligence. This will repaint a more realistic image of the business's current circumstance.
Existing Debts and Future Obligations
If the existing company is in debt, which many businesses are, then you will certainly have reason to consider this when valuating/preparing your deal. Many businesses take out loans in order to cover points like stock, payroll, accounts payable, and so on. Remember that occasionally this can imply that profit margins are too small. Lots of companies come under a revolving door of taking on debt as a way to pay back other loans. In addition to debts, there may additionally be future obligations to consider. There may be an outstanding lease on tools or the structure where the business resides. The business might have existing contracts with suppliers that should be satisfied or may lead to fines if terminated early.
Understanding the Customer Base, Competition and Area Demographics
How do operating businesses in the location bring in new customers? Often times, operating businesses have repeat clients, which create the core of their daily revenues. Particular aspects such as new competitors sprouting up around the location, road construction, and also employee turnover can impact repeat consumers and also adversely influence future revenues. One important point to think about is the area of the business. Is it in a very trafficked shopping mall, or is it hidden from the highway? Undoubtedly, the more people that see the business often, the greater the opportunity to build a returning consumer base. A last thought is the basic area demographics. Is the business located in a densely inhabited city, or is it situated on the outskirts of town? Just how might the regional average household earnings impact future revenue potential?