What value would you put on this business?

dharm999

As the turnover is low, there wont be an audit. The accounts filed at companies house and used by the accountant for things like tax comps will be based on the figures provided by the owner, which could be manipulated. As everyone has said the figures look to good to be true. Ask for a copy of the accounts filed at companies house, and also the detailed P&L that was prepared but not filed. That will show you the real profit and also the detailed overheads.

Calum

COOLTRIKERCHICK wrote: »

do you know what they have advertsied the business for? Or are they asking for offers? if so ask the estate agents for a guide line of the type of offers they are looking for....

They are asking for £170k plus SAV.

kazwookie

Have you (or a family member) actually sat in the shop and had a coffee and just watched the trade at different times of day / night? and done a count.

What are the customers actually buying, / what is their average spend roughly (sit where you can see the till) x by the number of customers per hour, and I think you will find a truer picture of actaul spend / net turnover. (you know what the given opening hours are)

The figures given so far do not add up as others have pointed out, dig deep BEFORE you commit to any thing.

Premier_2

Calum wrote: »

What value would you put on this business?

Let me tell you where I am.

The numbers you have have clearly been 'massaged'.
You haven't got a clear picture as some numbers appear to be missing (perhaps hidden in the rest of the groups numbers) and the numbers you do have don't even add up, both literally (overheads) and in the sense they don't appear at all realistic (wages bill).
Also you haven't been given any sight of the balance sheet yet, so you don't really know what it is that is on offer or its value.

For those reasons alone, it's impossible to even attempt to start to put a value on this. I've already heard enough, and I'm out!.

FatVonD

kazwookie wrote: »

Have you (or a family member) actually sat in the shop and had a coffee and just watched the trade at different times of day / night? and done a count.

What are the customers actually buying, / what is their average spend roughly (sit where you can see the till) x by the number of customers per hour, and I think you will find a truer picture of actaul spend / net turnover. (you know what the given opening hours are)

The figures given so far do not add up as others have pointed out, dig deep BEFORE you commit to any thing.

Good advice. I did this outside a sweet shop/general store I was thinking of buying many years ago situated very close to a school. I parked up outside at 3pm only to see all the mums and kids cross via the pedestrian crossing to the other side of the road as they all lived on the opposite side of the town.