Help - I want to learn the Math for my first Mat

[Domd]

I’ve been reading the threads and was hoping that maybe one of you could give me a hand trying to figure out the math. I’m looking to buy a Mat with 18 - UniMat UniMac 50 washers and 16 - ADC dryers All are 9 years old

Water usage for the past 6 months - 638836.4 gallons

It Grosses 15,275.00 a month

Monthly expenses are

Rent 2876.00
Gas 1376.00
Elec 559.00
Water 225
Repairs 150.00
Supplies 400.00
Ins 250.00
Tax 608.00
Misc 400.00

Total Exp 6844.00

Profit 8431.00

So what do you think does this work?

[Amex]

Is the gross sales all coin or is there wash-n-fold,drycleaning? If its all coin then water usage is way too low. I see no expense for labor.

[Gatorlenny]

106,472 gallons of water permonth for only $225??? Are you sure? Electric seems low, thats a lot of machines running to use that much water, is there ac? Repairs seem way to cheap for 150 a month also.

Aska distributor in your area about checking the ratios. Add up electric, gas and water and divide by the gross. The number you get should be consistent for what part of the country you are in. If there is WDF, that number should be a lot lower than unattended.

[pete f]

rent ratio is great. if the lease is good I'd snap it up! Don't worry if you make 8400 a month, you have room for downside. My assumption is it is all coin revenue. If any w/d/f or attendanet, no ideas. Water sewer bill does not look right, maybe have a well or landlord paid utilities?

[Domd]

I have the water bill for the past six months. The amount per month is actually less than the $225 per month. It comes out to $196.42 and, it’s city water. There is one employee as far as I know and I’m told she is being paid $7 an hour. I was told the W/D/F is a large part of their business and there are commercial accounts also. So I just asked for names of the accounts and receipts and there phone numbers so that I may speak to them. The lease is ten years and at it’s end, the rent will increase to roughly $3800 a month. So what do you all think! Is there any thing else I should know or find out? The asking price for the business is $250,000.00. Your thoughts?

[Gatorlenny]

Pull all the utilities from the utility companies to verify the usage of water gas and electric. If lease is going up, do not get less than a 20 year lease. 2 five year and 2 5 year options. Dont' do anything unless the existing owner can provide tax returns for at least the last 3 years. With the rent going up your ratio there will be 24.8%. Not too bad, but over 25% gets to be high.

[pete f]

Maybe there is a sewer bill missing? Water is always sheaper than sewer. With a big w/d/f look over contracts, if any. You are very dependent on his customers. I only deal in coin revenue self serve mats so w/d/f is beyond me, and appears a risk. Your prices will go up in time as will the rent, so that is not a worry. I agree you ned lease options, what most people do not get with thier options is a specified rental increase. Most options are "agreed upon rent" and are useless written that way. Sure, you get another 5 years but the landlord is in control and can raise your rent 15%-100%, his choice. You agree to pay it or move, and we know mats are had to move.