But if you absolutely, positively can’t get away, all hope is not lost. You can have that same picnic in your backyard. Or even a barbeque. Better yet, spend a cozy night indoors with your lover. Plan a special dinner complete with candles and soft music. Now, I know you’re getting some ideas!
If you want to figure out what the debt service is for this business, take the true discretionary cash flow and divide it by 33%, as the most a buyer should pay yearly on debt service is 33% of their cash flow. That number is then divided by 12 for the year. The result is the most that your business can afford to pay monthly, including a recoup of a down payment and still pay an owner, and remain solvent.
It wasn’t so long ago that the first real test of a barcode system took place. It was in Cincinnati at a Kroger store, where employees placed codes printed on sticky paper on items for sale. It was the summer of 1972, and the experimental codes were in the shape of a bullseye.
Do you like driving those long country roads at night with nothing to light your way but the headlamps on your car? Like all things in life each forward motion comes with limited vision of what is to come. We can only see a few meters into the distance when we drive on an unlit road but even that small amount of vision allows us to travel many hundreds of miles if we wish to.
If you do buy an existing coffee shop, as a first time shop owner I’d be sure it is not a failing one. The worst thing to happen is to try and turn around a failing shop when you have no working experience yourself in a profitable one. Look for a shop making money, but also be prepared to not change much, if anything if you do buy it. Reality is, if you do change what is working and making money you can open yourself up to losing business. That would not be good!
I was watching this new show the other day called “Fashion House” and I could not help but notice the gorgeous actress named Michelle Miller, her real name is Natalie Martinez. Natalie plays a sexy dress designer, who’s going through a stressful divorce. A wealthy young man, who could have any girls he wants, becomes obsessed with Michelle (Natalie). He meets her, she likes him, but she quickly notices that he’s nervous. Natalie asks him “Why are you nervous?” This puts him in a bind, but he says the right thing to her and ends up getting a date with her.
Keep in mind that as a new owner, you have to use that discretionary income to base what your debt service is going to be. Debt service is what a new owner can comfortably spend every month on paying off the note to buy your business, including a recoup of the down payment. The objective for buying a business is opposite of buying a house being that it should be paid off ASAP, three years max, so the price should also be in line with future debt service.