[SEL] OT (way OT!) advice on how to sell business needed

[Jeff Allen]

Bill,

You are in a tough position not owning the building. I had a buddy try to
sell his business some years ago and he was in a similar situation. He
didn't own the building. The deal fell through because the owner would not
lease to a buyer at the same rate. If the Masonic Lodge will agree to commit
the same rate to a buyer you are in good shape. If not you have an inventory
to sell off. Your low rent rate is part of your profit and any buyer will
look at that. The "blue sky" won't fly if the business has to move to
another location. You have an established customer base at an established
location and that is your selling point if it works out. Best of luck.

Jeff
----- Original Message ----- 
From: "Bill Dickerson" <bill at antique-engines.com>
To: "'The SEL email discussion list'" <sel at lists.stationary-engine.com>
Sent: Thursday, July 29, 2004 5:31 AM
Subject: RE: [SEL] OT (way OT!) advice on how to sell business needed


> >>how to get food on the table after you no longer have an income from
your
> wife's quilt shop<<
>
> I've now got a full time job. I start Friday, decent job, though not as
good
> as I'm used to, the benefits will be good.
> That means that BOTH of us will have full time jobs and thus little time
to
> put into the things that it takes to own a business.
>
> The building is leased from the Masonic Lodge (they are not-for-profit as
> far as IRS is concerned and have always kept rent LOW)
> It's in Valley Junction - a tourist area of West Des Moines.
>
> There has been profit in each of the 5 years we've had it.
> Inventory - it's packed to the gills. Inventory has grown in each of the 5
> years we've had it.
>
> Bill
>
> -----Original Message-----
> From: sel-bounces at lists.stationary-engine.com
> [mailto:sel-bounces at lists.stationary-engine.com] On Behalf Of Dave Rotigel
> Sent: Wednesday, July 28, 2004 11:43 PM
> To: The SEL email discussion list
> Subject: Re: [SEL] OT (way OT!) advice on how to sell business needed
>
>
> Hi Bill,
>     One thing that you need to plan for is how to get food on the table
> after you no longer have an income from your wife's quilt shop. That, it
> seems to me, is the most important thing that needs to be considered!
>     As to the value of the business, start out with the value of the
> inventory and then multiply it by 0.75. Add to that the replacement cost
of
> the building. Be honest here--we all think that what we own is worth more
> that any buyer will! (75% of your estimate, again, is probably right
unless
> you get a professional agent to evaluate the structure.)
>     As to the value of the business itself, if it's only "paid it's own
way"
> (that is, if there is no profit at the end of the year) it's not worth
> anything. If there has been a profit, I believe the rule of thumb is 10
> times the yearly profit. Perhaps someone in business can comment on this
"10
> rule."
>     In any event, good luck with the selling venture. Let us know how it
> goes and how you intend to put food on the table once the business is
sold!
>     Dave
> PS, You might want to consider carrying the mortgage yourself on a land
> contract. That way if the buyer defaults you get the business/building
back.
>
> > Since there are so many great minds out here, thought I would ask this
> > group. I know there are doctors, mechanics, judges and heaven forbid,
> > probably
> even
> > lawyers out here.
> > Time to sell - wife wants to get back to normal life.
> > We've done this for 5.5 years and it's time to move on.
> > She wants to sell the quilt store.
> > Running it was easy compared to what it seems to take to sell. Anyone
> > know how to value the thing and how to go about it - or more
> > importantly, how to NOT go about it?
> >
> > Anyone know what SDCF and/or EBITDA cash flow are and how to get to
> > that? It's been successful, it's paid its own way and has survived
> > competition
> and
> > economic downturn but we want our time back!
> >
> > So what do we do - or not do?
> >
> > Bill
> > Runnells, Iowa, USA
> >
> > "and tho my race was thought immune,
> > Themselves they did consume.
> > So be warned, or be mourned tomorrow"
> >
> >
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> > SEL at lists.stationary-engine.com
> > http://www.stationary-engine.com/mailman/listinfo/sel
> >
>
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