advice please on purchasing ongoing business

chickmug

paulwf wrote: »

I can't really see what you are paying 30K for - you mention the volume of work he carries out is now limited so a shrinking customer base, and the stock etc is worthless. Of course there might be a lot more to it than can be conveyed in a forum posting

As chickmug says the business is a tricky one to sell why not offer him say 5K or 10K? If he is in his 80's he probably wants to sell up soon and anything would be better than nothing to him. At the end of the day you could wait until he closes and approach the freeholder directly.

I think you need to do a business plan setting out the cash input required for new stock and tooling, as I can see that running into many thousands and dwarfing the cost of buying the business. As regards to raising money there are asset finance companies that lend against new equipment you purchase, although this may still need a house as a guarantee.

Whatever you do don't rush into it, perhaps do the Business Link courses as they are held fairly regularly in all parts of the country and are totally free.

It would be good to get an update from the OP but agree with all you say.

When this sort of 'one man band' business is sold the existing customers usually dissappear in significant numbers.I would be tempted to see if I were the OP if I could do a start from scratch. They say the price is £30,000. But without more information hard to get too stuck into the options.

hotpot1000

I would be worried if you remortgage for this business and in 5 or 7yrs the lease is not extended, then what would happen?

There was an MOT garage for sale on ebay for similar money recently

ben_and_elly

paulwf wrote: »

I can't really see what you are paying 30K for - you mention the volume of work he carries out is now limited so a shrinking customer base, and the stock etc is worthless. Of course there might be a lot more to it than can be conveyed in a forum posting

As chickmug says the business is a tricky one to sell why not offer him say 5K or 10K? If he is in his 80's he probably wants to sell up soon and anything would be better than nothing to him. At the end of the day you could wait until he closes and approach the freeholder directly.

I think you need to do a business plan setting out the cash input required for new stock and tooling, as I can see that running into many thousands and dwarfing the cost of buying the business. As regards to raising money there are asset finance companies that lend against new equipment you purchase, although this may still need a house as a guarantee.

Whatever you do don't rush into it, perhaps do the Business Link courses as they are held fairly regularly in all parts of the country and are totally free.

HI. Thanks for your input.
Currently looking through Business Link website - extremely helpful.
Price has subsequently dropped to 20k with increase to 25k to keep the name. Business has been running since 1960's and is well known throughout the area.
Cash input to start would be minimal as it is currently fully operational site, and in addition I have my own personal equipment that will be taken with me from current employment. There will need to be some modernisation, such as cosmetics ie. decor etc.

We are waiting to see if current freeholder is willing to extend lease further.

Have spoken to others' in the "car servicing" business and they have said that due to location (main road lots of passing trade - hopefully!) and area these sites are rarely available at this price and that it would be snapped up by bigger fish so to speak!

It would be great to wait for closure and offer a lot less, however, this makes things difficult with VOSA in relation to continuing business as MOT station.

Loads to think about, but all replies definitely give us more to think about and check which is brill.

Hope to keep you updated!

ben_and_elly

hotpot1000 wrote: »

I would be worried if you remortgage for this business and in 5 or 7yrs the lease is not extended, then what would happen?

There was an MOT garage for sale on ebay for similar money recently

Yes, the length of lease is one of the main concerns. Not sure what would happen, still waiting to hear.

ben_and_elly

chickmug wrote: »

It would be good to get an update from the OP but agree with all you say.

When this sort of 'one man band' business is sold the existing customers usually dissappear in significant numbers.I would be tempted to see if I were the OP if I could do a start from scratch. They say the price is £30,000. But without more information hard to get too stuck into the options.

HI. Thanks for your input.

Price has subsequently dropped to 20k with increase to 25k to keep the name. Business has been running since 1960's and is well known throughout the area.

Cash input to start would be minimal as it is currently fully operational site, and in addition I have my own personal equipment that will be taken with me from current employment. There will need to be some modernisation, such as cosmetics ie. decor etc.

We are waiting to see if current freeholder is willing to extend lease further. They currently use the land surrounding garage to store their own vehicles and were not going to extend lease when current owner left as they were going to store more vehicles there. This is currently on hold if they extend the lease further.

Have spoken to others' in the "car servicing" business and they have said that due to location (main road lots of passing trade - hopefully!) and area these sites are rarely available at this price and that it would be snapped up by bigger fish so to speak!

It would be great to wait for closure and offer a lot less, however, this makes things difficult with VOSA in relation to continuing business as MOT station.

Just fed up of working really hard and lining others' pockets! Just be nice to continue to work really hard and reap the rewards (eventually) for myself and family. And as you quite rightly say, who dares wins and well, as my in-laws said "we have a spare room!!!!!"

Loads to think about, but all replies definitely give us more to think about and check which is brill. If you need any further info, happy to provide. And once again, many thanks for your input.

Hope to keep you updated!