DPRock

iTrader: (9)

Hey guys just needing some input/help with getting a business plan together. I'm looking to buy the company that i work for. Its a auto repair shop that does mostly transmission repair. He's asking 100k for a shop that's been in the same location for 30 years. We average around 6k a week for a shop that only has greensheet advertising. I know the place can do better with a nice built website and internet advertising.

MavrikTA

iTrader: (27)

So what exactly is the question? I looked into this at one time as well. Ran into some EPA issues. Some of these old shops didnt bother disposing of filters and fluids "correctly". Do your research and make sure you arnt buying a business that is an EPA target!

DPRock

iTrader: (9)

Where do i start? What's all needed in a business plan? We do everything right over here filters get picked up and fluid as well. Only problems we ever had with the city was grass to high or trees needed to be trimmed. My problem I'm having is he wants to sell me the business but not the building/land he wants me to sign a lease. I'm down for signing a lease but only with a option to buy the building/land in a few years. I feel like the only great thing is the shops name and number has been yhe same for 30 years.

rbl3

iTrader: (1)

You need to look at his books, take a good look at his expenses; this will tell you what he Nets. Then you can take that to a bank for a loan and get an idea of a loan payment. You also need to factor in taxes (25% of Gross). Now add the previous shop expenses, lease payment, the loan payment, the 25% taxes; and put money away for expenses that the shop may use and or upgrades (like website fees). If theres enough money to pay yourself (unless you wanna work for free) then go for it. I wouldnt do it unless the building was included, assuming his books are good. Good Luck

DPRock

iTrader: (9)

Thanks. I'm just so tired of busting my *** for someone else to make the money. I know i can hustle up and get this shop making more money. Ive worked for other shops that spent money on advertising and they were making 20k-30k week.

JMAC

iTrader: (38)

Dave good luck with the buy, I hope it happens for you.

DPRock

iTrader: (9)

Thanks jerry i hope it happens too. If not think ill find a location and start a shop.

KOBUS

I would only consider if the building and land come with the deal. You buy only the name and what if he decides not to lease to you after the inital lease is completed? I would imagine most return business already knows where the location is and will just go to the shop to inquire about repairs they might need. If you had to move then that would be business that was lost since you weren't still at that location.

Carguy8888

iTrader: (1)

Did the site ever sell gas? Then you might need the ground tested if u were to buy the building. Before u sign on the dotted line you need to know what the place nets not groses a year so u know how long or if u will be able to repay the note and live. Pay a professional to run the numbers, look at his past returns & the lease. It will be money well spent before u jump in. Also don't forget u would need to hire someone else to help or replace your posirion b/c u will have new and added responsivilites. Good luxk, so your home work before u commit. It will change your life.

Carguy8888

iTrader: (1)

Being the owner does not guarantee you will make more. It will guarantee you will have more expenses. You need to see what is going out and have enough starting operating capital. Both comments are an opinion feom past personal experience.

DPRock

iTrader: (9)

Never sold gas. It used to be a old drive thru carwash. Its a good location to have a repair shop. I know its going to change my life and its going to be a lot more work then what I'm putting in. problems why he's not making the money he should be making. Greensheet advertising brings in poor folks looking for greensheet deals pretty much they want a transmission rebuild for 400.00. Then we have word of mouth advertising but most of the word of mouth is poor folks from greensheet telling more poor folks about us. I been running the office for a little over 2 years I've had customers 3 blocks from the shop tell me they lived in the area for over 10 years and never knew about us. Another problem is all he wants to do is transmissions and no other auto repair. What do we do when we are shopping for parts or a repair shop for are cars to be fixed we get online and search.

Carguy8888

iTrader: (1)

Good points, with your drive you prob will do much better. So if he is lousing or breaking even his pgone numbwr and good will is prob not worth 100 k. Owning a building is only as good as the tenant. It may be better to wait and he will beg to take it. Just get a professional opinion before you commit.

AGRV8D

iTrader: (19)

sounds like you have your mind made up, but listen to these folks in here, there is some great advice.

Carguy8888

iTrader: (1)

I have been there and have the battle scars to remind me.

DPRock

iTrader: (9)

I'm listening and trying to explain what's going on here at this shop. You guys think 100k is to much maybe i should make a offer of 80k sign a lease agreement for maybe 3years with a option to buy the building/land. I'm going to have someone come out and check everything out. The owner and i will be sitting down to talk and go over the books for the past few years.

Hi-Po

iTrader: (4)

Get a lawyer.

Start talking to banks after a lawyer draws up a contract. If your asking for a loan they will usually give you a form with questions that require detailed answers. This, along with a business summary, can pass as a "business plan". Don't deal with the owner without contracts in place. Rule number 1.

Ideally though, you won't even think about moving forward without seeing detailed books/records/tax returns. If the numbers don't add up, there's no point in even spending brain power thinking about business ownership.

I'm in the process of buying a automotive business 5 times the asking price your dealing with . . . I'm close to 3 months of negotiating, bankers and BS. Best of luck to ya.

igtabg1

iTrader: (3)

David you run a good shop, I was extremely satisfied with the level of customer support and detail you went over with my car, that shop has a lot of potential. This is charles with the 01 vette btw.

btownws6

everyone on here has given you the tools you need. Without the help of professionals you could really be up ***** creek. I would hire a lawyer, an accountant and get the building inspected thoroughly. Then if the building checks out and the books are balanced i would negotiate ownership of the land and building. If he agrees then go forth but be cautious because you never know what he has going on.

DPRock

iTrader: (9)

Thanks guys for the advice. We shall see what happens.

DPRock

iTrader: (9)

Thanks charles.