thinking of buying a garage

londonTiger

arcon5 wrote: »

If you have to ask what gross profit is then buying a business of this size isn't for you!

he wasn't asking for gross profit, gross profit is 50% of the 3-400K as stated in his post.

gross profit = revenue - COGS.

He was asking for net profit ballpark figure, which is profit taking into account overheads, wages etc.

There are various reasons as to why OP would not have that info, notably the seller will not divule commercially senstive info unless the OP has met the serious buyer threshold which requires a lot of time with seller.

Ozzuk

I think everyone's point is more that if you are spending 300k of your hard earned (or maybe even imaginary) money then you shouldn't be asking such basic questions.

There is no way we could comment on profitability without understanding the liabilities.

agrinnall

londonTiger wrote: »

OP most on UKBF, most MSErs are complete idiots when it comes to this.

UKBF = ukbusinessforums.co.uk

Takes one to know one, as they say.

forgotmyname

londonTiger wrote: »

OP most on UKBF, most MSErs are complete idiots when it comes to this.

UKBF = ukbusinessforums.co.uk

And yet you have asked for help several times.

bigjl

londonTiger wrote: »

OP most on UKBF, most MSErs are complete idiots when it comes to this.

UKBF = ukbusinessforums.co.uk

Says the person who was happy to deliver stuff without the correct Insurance coverageZ

bigjl

londonTiger wrote: »

he wasn't asking for gross profit, gross profit is 50% of the 3-400K as stated in his post.

gross profit = revenue - COGS.

He was asking for net profit ballpark figure, which is profit taking into account overheads, wages etc.

There are various reasons as to why OP would not have that info, notably the seller will not divule commercially senstive info unless the OP has met the serious buyer threshold which requires a lot of time with seller.

50% Gross Profit in a small Garage


Lol.

Maybe if you are one of the Mechanics.

But to be honest the margins or not that good in a Garage.

Anybody that has run a Garage will tell you that.

Which is why so many smaller Garages dabble in used cars sales as a sideline, I used to use turn cars round to help make the payroll, and if a car in need of some work popped up at a knock down price it was bought as a quiet days project to keep the staff busy.

If anybody believes a small Business is making £150/200k on a £300/400k T/O is crazy. I would look at the books again because I can smell burning, probably from overlooked books.


Looking at the OP, there is mention of how easy it is to find Mechanics, which means the OP is unlikely to have any ability as a Mechanic.


The owner of the Garage I ran sold it to three young lads that had experience of running a Petrol Station and a Newsagent.

I left as they wanted to drop my wages against an agreement made with the previous owner, they though they could do it better.

They lasted less than 2 months.

As a matter of fact was it dark when the OP looked over these "books"

Turn_to_Grey

I don't know though, there's always an expanding market for Yaris rear brakes.......

Bigphil1474

My brother ran his own garage for 15 years - gave it up because it was too cold in the winter, his body was shot, and he couldn't be doing with all the new regulations on this, that and the other. If it's an established garage with a good reputation, and the existing mechanics are likely to stay on, then someone with a good business mind might be able to make a go of it. However, if you aren't a mechanic and you are looking to make a wage on other people's work, a small garage probably isn't right for you.
My brother only made a living because he was a mechanic, and he could stay late to get that last job done, or cover for his staff if they were on holiday or sick etc. He typically worked 12 hour days, 6 days a week, and made about £25-£30k a year (officially). The upside is you can make a bit of extra money cash in hand, but you still need to produce reasonable books for the Inland Revenue. The down side is that a small garage lives and dies on its reputation, and punters expect value for money.
Just a thought, but if you are talking about a petrol station garage, it's a whole different kettle of fish.