What's next...

[Anonymous]

I am looking at a mat and have minimal info on it so far. But first I wanted to know if it is a good idea to buy a mat (my 1st one) if it is going to be about a hr away? There aren't any mats for sale w/in 50mi of where I live under $100 -$130k. I don't want to jump into nothing too steep on my first go around. The mat is 1600sqft, asking price is $75k, owner wants $50k down, he's willing to finance the $25k @8% for 60mos. 1 pt employee, Lease/Mo $2102

Tax Return Tax Return Tax Return
Year (Cash Flow) 2004 (Y) 2003 (Y) 2002 (Y)
Gross Revenue 76,462 75,288 80,571
Cost of Goods 4,009 3,343 1,584
Gross Profit 72,453 71,945 78,987
Expenses 40,941 51,513 47,600
Net 31,512 20,432 31,387
Owner Salary See See See
Benefits Cash Cash Cash
Interest Expense Flow Flow Flow
Depreciation Report Report Report
Other
Owner Benefit 31,512 20,432 31,387

I don't really know what i need to ask for next or what exactly I should be researching at this time? Can anyone just point me in the right direction.

[Coinwash]

Most of your answers on on the board get to reading and I assure you the members will jump in.
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Information for prospective Laundromat buyers.



You never pay more than 3 to 3.5 X the net.
Always be ready to walk away.
How far are the closest Laundromats?
You must look at the Tax returns for the past 3 yrs.
No one would lie to the taxman and say they are making more.
Everyone tells everyone they take from the top.
This is wrong and should not even be taken into consideration. To me that’s a RED flag!
Don’t go into this unless you are ready to work hard. This is not an easy job. You don’t just collect Quarters!
I tell people to go to the Laundromat they are looking to buy, with a bunch of towels to be washed and dried.
Don’t open your mouth. Sit and watch.
Plan on staying there a while. Be a FLY on the wall.
Watch, look, and listen. Remember, no matter how hard it is, don’t talk to anyone there.
It’s not fair to the seller or to their employees.
Now I don’t mean to go just one time. I am telling you to do this for at least a week or two. (Maybe every third day).
If you do buy this Laundromat, believe me you will be spending more time there then a week or two.
You are spending your hard earned MONEY.
Try not to be an obvious neophyte
Good luck.

This is only my opinion. You do what you think is right; Follow your business instincts.

Coinwash.com
Jonathan

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The Financials
Seller’s stated Profit and Loss Statement
Water Bills (last 12 months)
Electric Bills (last 12 months)
Gas Bills (last 12 months)
Parts? Receipts on repairs? Service Contracts?
Tax Filings?
The Assets
Washers and Dryers / Make, Model/Yr/PriceVend
Water Heater(s)
Condition of Floors
Condition of Counters/Tables for Folding.
Vending Machines
Soda Machine
Soap Machine
Candy (Gum/Bulk) Machines
Pay Phone
Video Games
Changer Machines
# of Carts/ Baskets
Alarm System
Which Alarm Company is being used?
What type of service is in place?
Can I see the contracts?
Vending
Which machines are owned?
Which machines are leased?
Vending Lease Contracts/Agreements?
Service
Who has been providing equipment upkeep and service?
Receipts?
Any Contracts/Agreements?
Who has been supplying vending goods? Soda?
Who supplies the video games?
contracts? Agreements? What’s the cut?
Insurance
Liability Insurance
Hazard Insurance
Current Insurance Carrier?
Any problems with insuring the place?
Get the current insurance contract, check for clauses.
The Employees
# Of Employees
Hours and Pay
Contract Personnel? Salaried? Hourly?
Duties
Are they willing to stay on after purchase?
How long have they been contracted/employed?
The Legal and Corporate Issues
Accounting Fees
CPA Costs Annual / Quarterly Reports
Legal Fees?
Business License Cost
The Company's Contracts and Leases
Vending Contracts/Agreements?
Supplier Contracts/Agreements?
Video Game Contracts/Agreements?
Alarm/Security Company Contract/Agreements?
Any Insurance Contracts/Agreements?
Property Lease Contract/Agreements?
Equipment Service Contracts/Agreements?
Property Lease
CAM Fees – cost / what is included in the CAM Fees
How are CAM fees divided amongst tenants?
Who determines CAM fees and items?
What percentage of fluctuations in CAM fees in
the past or foreseeable in the future?
Can I get a breakdown of the CAM/ RE Insurance / RE Tax?
What is personal property tax? Of $33?
Current Lease
Lease Increase Rate
Lease Expiration/Options
Lease Deposit
The Suppliers
Vending Suppliers? Any Contracts?

There is much more to do. Read the bulletin board ask questions do your home work,

Good LUCK!!!

This is only my opinion. You do what you think is right; Follow your business instincts.

[pete f]

forget all the great info coinwash offered, 1 hour away, do not keep a gun around to shoot yourself with when the time comes. No gun? try mint sticks. LOL

[Fred50]

forget all the great info coinwash offered, 1 hour away, do not keep a gun around to shoot yourself with when the time comes. No gun? try mint sticks. LOL

My store is 15 mins away and it seems like 2 hrs when I get home after a long day and sit down to dinner when I get a call from someone at the store to come run over. It's also great after you get there and realize that you didn't need to go.

This usually happens when it's raining, snowing, or both or a major acccident just happened on the highway or you forgot your keys at home, etc.

You get the idea. If the store is unattended, you should try to be within 10 minutes of the store 24/7 :-)

[Kitty]

We have all had these disussions before about what is too far and what is not.... Here is my take....

In actuality the business WILL operate without an attendant.
Security cameras WILL tape all activity.
Two or MORE FUNCTIONING changers should keep you operational in the event you have one or more changers go down.
SUPERIOR ATTENDANT TRAINING with HANDBOOKS giving neccessary EMERGENCY information such as key info about WATER VALVE shut offs in cases of emergercy etc.

Now, it all depends how YOU want to OPERATE YOUR business. Do YOU want to be a HANDS ON OPERATOR? Will you have the time to drive 1 hour every day and stay all day every day? Do you care to at all? You may consider it worth the sacrifice that you will not be able to just jump back to the mat. Will the customers consider it worth it in the event they have any issues?

What do you want out of it? What you put it, is probably what you will get out....

[TotoMongo]

...There aren't any mats for sale w/in 50mi of where I live under $100 -$130k. I don't want to jump into nothing too steep on my first go around. The mat is 1600sqft, asking price is $75k, owner wants $50k down, he's willing to finance the $25k @8% for 60mos.

Just a few questions if I may:

How do you know there arent any mats for sale in that range w/in 50 miles of you? Are you taking someone else's word for it or did you talk to every owner in that radius? The point I make here is fairly obvious.

75k isnt a great amount to spend on a mat - 25k over 60 months? That seems like an awfully long time for such a small amount of money. Is this standard in your part of the country? When I first started looking for a mat the impression I got was that deals under 150k weren't financed.

Btw, an hour will seem like a day after the initial thrill of owning your first business wears off.

Good luck to you,
Toto

[Btracy]

You never pay more than 3 to 3.5 X the net. I've heard 5 times net...

[amartlock]

In southern california, a good deal is 5 times net. More often you're paying 6 to 7 times net.

[Btracy]

Interesting...it seemed a bit low. I'm sort of managing (read volunteering) at a mat in SF and the owner is willing to sell to me for what seems to be about 5 times net, so I was concerned that I might be over paying.

[Coinwash]

You never pay more than 3 to 3.5 X the net. I've heard 5 times net...

Nothing Is an absolute?

They're buyers who won't pay over 3 to 3.5 X the net.

They're Sellers who won't sell for 3 to 3.5 X the net and ask for 5x net.

Stick to what you want to pay it's your money -- THINK!
Do your home work;)