My new business (pic attached)
woodswise
TID Board Of Directors
- Apr 29, 2012
- 4,334
- 1,340
Hey MF. This is great news. Is it a single store front, part of a franchise, or a chain of stores? If you don't mind me asking, will this mean you will own two stores (I thought you owned one now), or only one?
One word if caution: if this is your second storefront, be ready for this. Owning a second business or opening in a second location, does not allow you to enjoy the economies of scale that most people think. People I know and trust (and I have witnessed this myself) say that opening a second location (or buying a business in a second location) is almost as much work as starting in the first location, so be ready to hire more help with your existing store and the new business. I have also heard and witnessed, on multiple occasions, that starting or purchasing a second business is a very risky time for an existing business owner, and creates an increased likelihood that both businesses will fail.
All of this is to say: Plan for the worst case scenario (i.e. losing customers and key employees, or having a natural disaster) at both businesses, then you should be ready for any and all challenges that might come up. Good luck with it buddy, I hope everything goes very well for you.
One word if caution: if this is your second storefront, be ready for this. Owning a second business or opening in a second location, does not allow you to enjoy the economies of scale that most people think. People I know and trust (and I have witnessed this myself) say that opening a second location (or buying a business in a second location) is almost as much work as starting in the first location, so be ready to hire more help with your existing store and the new business. I have also heard and witnessed, on multiple occasions, that starting or purchasing a second business is a very risky time for an existing business owner, and creates an increased likelihood that both businesses will fail.
All of this is to say: Plan for the worst case scenario (i.e. losing customers and key employees, or having a natural disaster) at both businesses, then you should be ready for any and all challenges that might come up. Good luck with it buddy, I hope everything goes very well for you.
Mini Forklift Ⓥ
The Veganator
- Dec 23, 2012
- 4,313
- 730
Thanks guys ~ I don't have time to write much at the moment but to bullet point:
** It's a franchise but the store owners own the head lease rather than the franchisor
** Single store (only one in Christchurch, one other in the South Island) and 25+ stores up in the North Island
** The Franchisor is definately looking at opening more stores in the South Island within the next 2-5yrs and we will be given the first opportunity to buy
** Owner is selling because they are retiring. Hardy's as a group has been around since the 80's. The current owners have owned this store since it opened 14yrs ago, I have worked with the company as a store manager for 7yrs
** Margins and profit are both very good and the group has experienced steady growth over the last few years despite the earthquakes and difficult economy, we've spent a few months running the numbers with the figures for the last three years trading. Franchise/advertising fees are around 5%, overheads and expenses are fairly high but then it is prime location in a busy mall. Foot traffic is excellent
WW ~ this will be my first store. I did look at purchasing another one a couple of years back but the timing wasn't quite right.
** It's a franchise but the store owners own the head lease rather than the franchisor
** Single store (only one in Christchurch, one other in the South Island) and 25+ stores up in the North Island
** The Franchisor is definately looking at opening more stores in the South Island within the next 2-5yrs and we will be given the first opportunity to buy
** Owner is selling because they are retiring. Hardy's as a group has been around since the 80's. The current owners have owned this store since it opened 14yrs ago, I have worked with the company as a store manager for 7yrs
** Margins and profit are both very good and the group has experienced steady growth over the last few years despite the earthquakes and difficult economy, we've spent a few months running the numbers with the figures for the last three years trading. Franchise/advertising fees are around 5%, overheads and expenses are fairly high but then it is prime location in a busy mall. Foot traffic is excellent
WW ~ this will be my first store. I did look at purchasing another one a couple of years back but the timing wasn't quite right.
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woodswise
TID Board Of Directors
- Apr 29, 2012
- 4,334
- 1,340
Very cool bro. And exciting, too.
If this is your first time owning a business, don't forget the profit and loss statement does not include the principal payments on your loan. So when you look at how much profit you will have in a year, you must then subtract the principal payments each year to have a good picture of how much money you will have left over for yourself.
That is a classic newbie mistake, and if you have good business advisors, i am sure you already have been told this. Best of luck to you.
If this is your first time owning a business, don't forget the profit and loss statement does not include the principal payments on your loan. So when you look at how much profit you will have in a year, you must then subtract the principal payments each year to have a good picture of how much money you will have left over for yourself.
That is a classic newbie mistake, and if you have good business advisors, i am sure you already have been told this. Best of luck to you.
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