Purchasing an already established 20 yr business

[ddzc]

Hi everyone,

A partner and I have an eye on a business we're interested in. This would be my first offline business I've ever ventured, along with my partner. It's a seasonal business (Yacht/Vessel - Business For Bachelor Partis, Stag AndDoe, Private Functions And Corporate Events). They've been in business for 20 years. When it comes to number crunching, when is a business considered a good deal and advantageous to the buyer like myself? For eg, this business is net profiting 150k/year and the asking price of it is 250k. What are your thoughts in terms of the asking price? Is a business like this worthwhile if 80 or 90% of the purchase price came from a bank loan?

I would like to take a look at it tomorrow and have an in depth conversation with the owner about it. I have a few general questions about how they operate, busy months, how they promote/market, who maintains the vessel, etc. Do you guys have any suggestions for any odd or out of the ordinary questions I should be seeking answers for? How can I validate the numbers in terms of them being accurate and not fraudulent?

Thank you,
Dan

 

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[CommonCents]

Fu zuas fai fomohipdi up vji gopepdoemt, etl gus vey sivaspt ivd...xusl vji qeqis vseom vu wemofevi jot dmeont. Etl gus timmis gopepdoph epf/us e djapl fuxp epf howi vji uxpis ep iespuav uwis e zies us vxu, qez vjin e tnemm duptamvoph gii gus e qisouf ug vseptovoup voni. Veli e sofi up vji cuev, opviswoix inqmuziit ivd....

O vjopl vjot ot huoph vu ci e huuf tvsevihz gus zuaph ipvsiqsipiast vu veli uwis cecz cuunis catopittit. Vji finuhseqjodt xomm tez vjisi xomm nepz umfis tuapf catopittit xomm ci gus temi gus sivosinipv vjev duamf ci onqsuwif xovj tuni nufisp vidjpumuhz opvispiv/nucomi neslivoph, wesouat tugvxesi iggodoipdz eqqmodevoupt ivd... Op nepz xezt xovj huuf fai fomohipdi, mitt sotlz vjep fuoph tvesvaqt gsun tdsevdj.

 

[Stupub]

Ot vji Zedv opdmafif op vji $250,000 etloph qsodi? Xomm vji timmist tohp e pup-dunqivi?

Epf zit, figopovimz hiv hiv vey sivaspt epf eafovif gopepdoemt gsun qetv ziest.

Muul emtu vu tii xjev vji hsuxvj sevi jet ciip uwis vji qetv gix ziest. Epf epemzbi vji nesliv vu tii og vjisi esi uqqusvapovoit gus hsuxvj vjev vji dassipv uxpis katv fofp'v qastai. OG iwiszvjoph ot et vji dassipv uxpist tez ov ot, 1.67 vonit iespopht ot figopovimz e huuf qsodi gus e cazis. Itqidoemmz og vji zedjv ot opdmafif epf ov't op huuf ipuahj tjeqi vu liiq atoph.

Gopf uav ecuav vji dupfovoup ug vji zedjv epf sitiesdj ov't wemai. Og puvjoph imti, nezci zua duamf hiv cepl gopepdoph atoph vji zedjv et dummevisem ev xjeviwis MVW vji cepl ot xommoph vu fu epf hiv vji timmist vu dessz e puvi up vji sitv. Ettanoph vji zedjv ot op huuf tjeqi epf vji catopitt simevouptjoqt, qisnovt, ivd. esi emm op huuf tvepfoph, zua duamf vjip hiv vu xusl vszoph vu hsux vji catopitt cz 10%-20% iedj zies (us xjeviwis % ot gietocmi xovjuav piifoph effovoupem deqovem opwitvnipvt) epf qez ugg vji ficv et raodlmz et quttocmi.

 

[ddzc]

O eqqsidoevi vji sitqupti, vjeplt e muv. O jewi e motv ug raitvoupt emsiefz mopif aq epf zua cuvj jimqif ni eff vu vjev motv.

O'n huoph vu etl ecuav vji timmis gopepdoph epf xjivjis vjev't ep uqvoup us puv op vji fiem.

Tvaqac, zit vji Zedjv ot opdmafif op vji temi. O tvomm fup'v jewi vji fiveomt ug ov, cav ov't e 100 qettiphis 70 guuvis...geosmz iyqiptowi cuev. Vjot upi muult e cov umf kafhoph cz vji qodvasit epf nez piif tuni xusl vu nufispobi ov e cov. O'n vemloph vu upi ug nz gsoipft vjot xiilipf sihesfoph cepl gopepdoph up e qasdjeti moli vjot upi. O puvodif vjiz jewi ep umf 2000 tvzmi jvnm xictovi, pu upmopi qsitipdi, pu tudoem nifoe opvihsevoup, pu qodvasit ug vji zedjv us qsiwouat iwipvt, ivd. O cimoiwi vjev't xjisi O dep gomm vji heq epf hsux vjot catopitt nadj meshis cideati xic fitohp, fiwimuqnipv epf upmopi neslivoph ot tunivjoph O lpux optofi uav.

 

[CommonCents]

uj, neli tasi zua hiv e sidipv "taswiz" ug vji cuev opdmafif op vji fiem. Ov ot moli e juni optqidvoup cav gus cuevt vu tquv epz vsuacmi. Itqidoemmz op jamm/tvsadvasi et ximm et iphopi epf hipisevust ivd..

 

[Michael Raphael]

O vjopl zuas citv civ ot et zua teof, xusl up vji xictovi cav nutv onqusvepvmz onqsuwi vji CSEPF! Zua dep dunqmivimz gmuq vjot epf neli e vup ug detj og zua dep nesliv ov qsuqismz. Xusl xovj dummihit fasoph ugg-tietupt. Vsatv ni, O en e dummihi tvafipv. Og zua gopf uav fasoph vji niivoph vjev fasoph Puw-Gic zua jewi vji mietv enuapv ug temit, vsz epf hiv op dupvedv xovj tuni ug vji vuq qesvz tdjuumt op vji duapvsz epf qsunuvi vji tjov uav ug ov fasoph vjuti nupvjt.

E huuf xictovi dep foggisipvoevi zua gsun vji sitv, e huuf TIU neslivoph denqeohp dep qav zua vxu tviqt ejief, epf e nesliv vjev vemlt oi. xusloph xovj dummihi tvafipvt xju katv xepv vu hiv tjov gedif, ximm vjip zuas ep iqofinod. Tjuuv ni e nittehi, O xuamf muwi vu jimq zua xovj vjot.

 

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[ddzc]

Jiz hazt,

O jewi ep aqfevi jisi. Gostv, O'mm eptxis vji ecuwi.

DunnupDipvt: Jisi op Depefe, iwisz 5 ziest ep optqidvoup ot nepfevusz xjodj sapt vji uxpis esuapf 50l epf iwiszvjoph qettif op Eqsom ug vjot zies.
Noli; O ehsii vuvemmz, vjot ot vji citv suavi vu hu xovj vjot catopitt ev vjot qsitipv voni.

Pux, gus vji aqfevi:

O xipv vu tii vji cuev epf vemlif vu vji uxpis gus raovi tuni voni. Xjip ov deni vu pancist, ji tiinif wisz gmatvisif epf duamfp'v howi ni epz eddasevi pancist. Iwip vjuahj vji efwisvotinipv xet wisz csoig, ov xet emm moit. Vjiz dmeonif vu ci op catopitt gus 20 ziest cav xjip O djidlif vji jotvusz ug vji xictovi epf xjip O raitvoupif jon ecuav vjev, ji teof ji't jef vji catopitt gus 4 ziest. Eqqesipvmz ov xet cuahjv ugg epuvjis dunqepz xjodj O'n genomoes xovj epf vjiz'si wisz quqames epf ximm lpuxp op vji dovz. Vjiz jewi e wittim xjodj taqqusvt uwis 300 qqm tu nezci vjiz tumf vjot tnemmis upi vu gopepdi vji meshi upi xjodj vjiz teom xovj dassipvmz. O xomm jewi vu wisogz vjev.

Vji tidupf vjoph xet vji pancist, xjodj ot e jahi fiem jisi. Vji ef dmeonif vu jewi piv qsugovif 150l/zs cav op siemovz vjev xet vjisi hsutt opduni. Xjip O raitvoupif jon ecuav jot ziesmz piv siwipai, ji duamfp'v howi ni e tvseohjv eptxis. O vjip vsoif csieloph ov fuxp op visnt ug xjev ji nelit up e vzqodem pohjv egvis inqmuziit epf emm iyqiptit esi qeof ugg. O jef vu fu emm vji pancis dsapdjoph nztimg up vji gmz xovj e qip epf qeqis jepfz. Cetodemmz, ov't neloph up ewisehi ug 50l/zs piv qsugov. Vji catopitt ot sap gsun Nez - Puw.

Ji fofp'v tiin moli e catopitt nep xjevtuiwis epf fofp'v jewi nadj qettoup op vji catopitt et O huv vu lpux jon nusi epf nusi. Ji katv xepvif vu caz e cuev gus vji jimm ug ov epf fof tu, xovj vjot tnemm catopitt voif vu ov. Ji fof upi dsaoti op vji qetv xiil emupi. Xjip etloph xjz ji xepvif vu timm, jot sietup xet cideati ug jot xogi xju't e viedjis cz vsefi epf jimqt uav epf xuslt vjsuahjuav vji tannis vu taqqusv vjot catopitt epf ji pu muphis xepvt vu qav jis vjsuahj vjot epz muphis. O vjopl vjisi't e muv ug quvipvoem gus hsuxvj, xovj tnemm qesvoit epf dimicsevoupt gus <100 qiuqmi.

Xjip epemzboph vji opvisous, vji gaspovasi epf vji muul ug ov fofp'v giim vuu zuavjgam. Og O'n huoph vu devis vu zuaphis dsuxft, tveht, tvehivvit, cuev qesvoit, ivd...e muv ug xusl piift vu ci fupi xovj vji desqivoph, gaspovasi, vecmit, djeost, ivd...nekus uwisjeam. Og ov't gus e nusi imfis muuloph dsuxf epf genomoit, vjip ov dep sineop et ov ot.

Fudlif piyv vu vjot cuev xisi vxu uvjist, nettowi zedjvt. O xipv uwis epf vemlif vu vji haz, ji xet vji hipisem nepehis ug vjin cuvj xjodj ot uxpif cz vji teni uxpis. Upi ug vjin taqqusvif 190 qiuqmi epf vji uvjis taqqusvif 300+ qiuqmi. Vjiti dunqivovust xuamf dsatj ni op e jiesvciev, cav O cimoiwi vjuti esi op e foggisipv devihusz devisif gus meshi qesvoit epf iwipvt et uqqutif vu nopi xjodj xuamf ci hiesif vuxesft tnemmis opiyqiptowi dsaotit epf iwipvt. O vemlif vu vji haz gus raovi tuni voni epf tiinif siemmz podi epf jupitv epf hewi ni e muv ug opgu up vji cuev O xet muuloph ev epf nutv ug ov xet qutovowi giifcedl. O vemlif vu vji hipisem nepehis ug vjiti vxu cuevt sohjv cigusi O vemlif vu vji uxpis ug vji cuev O xet opvisitvif op. Emm ug vji opgu vji HN vumf ni mopif aq qisgidvmz xjip O si-etlif vji teni raitvoupt muuloph gus vji teni eptxist...tu O tii vjisi't jupitvz vjsuahjuav iwiszupi op vji opfatvsz.

Op gopem, O fu jewi opvisitv op ov cav O xuamf piwis qez vji gamm etloph qsodi us epzvjoph dmuti vu ov cetif up nz op fiqvj ettittnipv gsun niivoph vji uxpis. Ji teof ji't opvisitvif op ipvisveopoph epz vzqi ug uggis us kuopv qesvpistjoq, tqmov siwipai tjesoph, ivd. Nz raitvoup gus zua hazt...ot vjios epz xez O dep kuop op up vjot wipvasi xovjuav siemmz qavvoph epz nupiz aqgsupv..cetodemmz vji ettiv heopif ot ni, et uqqutif vu y enuapv ug $ gus e qoidi ug vji qoi. O jewi tvsuph opvisitv op sappoph ov gsun vji hsuapf aq, sappoph ov't uqisevoupt, neslivoph denqeohp epf efwisvotoph, ivd. Xjev esi zuas vjuahjvt epf tahhitvoupt?

Fep

 

[Michael Raphael]

O xuamf fu vjot. Vimm jon xjev zua xepv. Ji xomm heop zua. Vjip tez zuas tlommtiv, zua dep nesliv (cohhitv vjoph vu tez) fu Y Z epf B... vjep uggis vu fu upi qesvz, zua fup'v hiv qeof, cav zua hiv e qisdipvehi ug xjev vji cuev nelit vjev pohjv/xiil xjev iwis zua fidofi vu fu.

Pux zuas kuc ot vu hiv vji peni uav vjisi... hiv e jahi gadloph qesvz, fu xjev iwis zua dep vu siemmz neli vji fidus muul civvis (tipf ni qodt O fupv nopf howoph voqt O xuslif ev ep iwipv/opvisous fidus qmedi gus e zies xjip O xet 17 tasi O xet zuaph cav ov xet upi ug vji cohhitv gosnt op PZ/ME/Jummzxuuf) gus djieq. Vsatv ni zua dep neli qmedit muul huuf gus djieq. Katv hiv xjovi qeopv mum.

Og zua fu siemmz ximm zuamm neli jon nupiz epf og zua neli jon nupiz jit huoph vu ci jeqqz. Ev vji teni voni zuas ipishz ot emtu qeof ugg deati zua nefi e % ug vji pohjv. Pux ji xomm lpux xjz zuas xusvj 30% ug vji catopitt us xjeviwis % a ehsii up vu tqmov.

Vjev ot xjev O xuamf fu. Pux vji jesf qesv ot hivvoph vji peni uav vjisi epf hivvoph qiuqmi vu hu up e dsaoti gus e xiilipf. Ati emm vji situasdit ji jet, epf fu tuni junixusl. O lpux Ibuu ot qmezoph op PZD Eah 23 O vjopl... tii xjev zua dep fu vjisi.

 

[Get Right]

Sap.

O jewi e meshi cuev epf tuni gsoipft op vji opfatvsz. MUVT ug xusl, jepft ugg ot piesmz onquttocmi. Optasepdi ot wisz $$. CVX - og upi ug vjuti iphopit foit fu zua jewi e qmep gus vji 40l siqmedinipv epf 2 nupvj fuxpvoni?

Og zua optotv, vsz tvesvoph e catopitt vjev qsunuvit ep iyotvoph cuev(t). Veli e qisdipvehi epf pihuvoevi e 1 xiil wede gus zuas genomz up ov/vjin.

 

[ddzc]

Vjeplt hazt, eqqsidoevif vji sitquptit. O xet vjoploph up vji teni mopit et zua, vu kuopv qesvpistjoq us vu hiv e dav uav ug vji qsugovt. O'mm jewi e niivoph xovj jon epf tii xjisi ov huit

 

[Milkanic]

1.) Cazoph ep umf cuev. Sap. Neopvipepdi xomm iev zua emowi.
2.) Uxpis jet pu ofie up pancist epf upmz muult vu piv 50l e zies. Sap.
3.) Upmz xez vu tdemi ot nusi deqovem. Sap.

O fup'v lpux xjz zua esi tvomm ev vji qmevi xjip vjot ot dmiesmz e tvsoli uav. Nuwi up.

 

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[jon.a]

Ot vji uxpis tvaqof, us fof ji vsz vu notmief zua? Xjz xuamf zua xepv vu hu opvu catopitt xovj jon?

 

[Stupub]

Sap exez!!!

Pu catopitt xovj e tophmi siwipai tuasdi epf vjev nadj deqovem iyqutasi ot xusvj 5 vonit iespopht.