Ever thought about becoming the local Ian Beale?!!

[Gucci]

Ok probably not. But since my career is focussed around retail design, advising and proposing retail campaigns to national and international retailers, I wondered what it might be like to own a shop.

I did some initial digging and was surprised at some of the figures. Profits are only disclosed on request, but here were a few details.

Dry cleaners £59,000 with a turnover of £36,400 p.a Working 6 days a week.

or

Coffee shop £125,000 with a turnover of £156,000 p.a

or

Planet Pizza £60,000 with a turnover of £208,000 p.a

Quite enjoyed having a nose round local businesses

 

[MOCAŠ]

Ever thought about becoming the local Ian Beale?!!

No, but I've got a model of his brother, Batmo...

 

[developer]

Ok probably not. But since my career is focussed around retail design, advising and proposing retail campaigns to national and international retailers, I wondered what it might be like to own a shop.

I did some initial digging and was surprised at some of the figures. Profits are only disclosed on request, but here were a few details.

Dry cleaners £59,000 with a turnover of £36,400 p.a Working 6 days a week.

or

Coffee shop £125,000 with a turnover of £156,000 p.a

or

Planet Pizza £60,000 with a turnover of £208,000 p.a

Quite enjoyed having a nose round local businesses

Hard work would be my first thought - potentially 6 day opening plus restocking time and administration time.

If you could get to the stage where it was staffed by others then that's a different scenario.

 

[jonnyboy]

how can u make a 59k profit from a 36.4k turnover?

 

[developer]

how can u make a 59k profit from a 36.4k turnover?

Purchase price and turnover.

 

[Gucci]

how can u make a 59k profit from a 36.4k turnover?

Very slowly.

 

[Godot]

how can u make a 59k profit from a 36.4k turnover?

er Creative Accounting

 

[Frankie]

I think you need to be prepared for a loss,sometimes a small business takes a while to get it's legs.

 

[tagnut]

The single most important piece of due diligence you can do when buying a business of this sort is to make sure that the stated turnover figures are the actual turnover figures! Get copies of VAT returns, go over the accounts, even spend some time working in the place before you buy to satisfy yourself that the business is viable. Without this all of your cash flow and profit forecasts are meaningless and you could struggle to make back your initial investment let alone make the profits you are looking for.

Only when you are satisfied that the turnover is correct can you build and implement a realistic business plan. Beware there is a lot of creativity on the part of vendors and agents that sell businesses.

 

[jonnyboy]

Tagnut is right.
We looked at a couple of shops last year with a view to buying.

Four weeks after we decided to hold fire the vendor was convicted of sex mith a minor sick ****ard). We dodged a bullet there - the business is ruined.

 

[NW_Merc]

But if you look at established franchise chains you can set up a very profitable operation. The one that you talked about was the fact that the owner did something to severely affect sales, something like that is statistically very low surely......

 

[EDZ649]

Purchase price and turnover.

I wouldn't get out of bed for that!