buying a business - Page 4 - TanToday - Helping Salon Owners, One At A Time, Since 2000!

Pink · 6th August 2005, 01:41 PM

I know...it does suck.

babagrace · 31st March 2006, 09:56 AM

I am really new at all this and I really need some advice. I am getting ready to start my own salon and need to purchase my equipment. Any advice on the best beds to choose? What are hott right now, and what are customers looking for? I'm really at a stump on what to purchase.

tangenie · 15th July 2006, 01:59 PM

Go to the salon and work there for a few days and watch what happens. Your schedule may not permit, but if I were you I would want to go inside the business and watch it for a few days and to really see how the salon operates, how well the girls are trained and how many tanners come through the door.

daredvl_edm · 13th September 2006, 02:40 AM

I am wanting suggestions and thoughts on this one. I was looking into purchasing an existing Tanning Salon for $59 900, own customers, 2000 in the system aproximately 1300 are active right now. 5 beds, one base, 3 high intensity, and one stand up. Well as I am doing my homework on the tanning industry, the price drops to $50 000, however the owner is absentee from the new ad they have posted in the paper. I am seeing issues here!

1. If the owner disapeared, people got screwed in their purchases.

2. Is it even feasable to start over from scratch as these current customers are probably pissed off.

Any suggestions and thoughts on this please. I mean, it could be good, but as it stands, ya the cost is good, but the reputation is shit.

missmojorising · 13th September 2006, 04:31 AM

What kind of equipment? I'm doubting 1300 are activly tanning in September but that could just be me.

daredvl_edm · 13th September 2006, 08:56 AM

The place had been open since 1994, so the beds are about 12 years old now. They are owned beds, not leased. The last owner has only run the place for a year, but the previous owners were there for aproximately 5 years. The beds themselves are Wolff systems.

Tanning Queen · 13th September 2006, 10:10 AM

Open for 12 years and they only have 2000 clients in the system? And yet 1300 of them are active? Sounds fishy to me. If the equipment is that old, the salon, AT MOST would be worth like $10k.

Din · 13th September 2006, 12:06 PM

They could have had computer issues and only put in their active users back into system instead of all of them. Know from experience. It's a possibility don't rule that out.

daredvl_edm · 14th September 2006, 10:27 AM

Just curious then, do you think I should ask for a lower price if negotiating, or just forget about purchasing it then. I mean the beds can eventually be upgraded and its clean and has potential. I think this manager just royally screwed up since she has been there for a year only. Yet she is an absentee manager which I am guessing means the place is closed down. The only thing I am concerned about is trying to rebuild a crappy reputation.

Tanning Queen · 14th September 2006, 11:04 AM

The only thing you are buying in a tanning salon is the equipment and any customers that have active packages. In this case, the equipment is worth like $100 each. If the rep is bad, the customers arent worth much either.

How much is their gross/net profit? What are the terms of the lease and is is assumable? Is there room for expansion? IS there enough AC & electric to upgrade the beds? What are the demographics of the area? What is the competition?

Those are some things you need to consider when looking to purchase a salon. Not just how many customers there are.

daredvl_edm · 14th September 2006, 02:01 PM

Well they told me the gross/net profit was good as they are busy, however it doesn't sound promising. As for the lease term goes, I tried contacting the lease company, and they were not helpful at all in which the lease agreement goes. All I know is they pay $1900/month. As for the AC and electric, I am not sure on any of that either at the current time. I know I would be able to add AC and electric but not to sure on what the capacity is set at right now.

There is room for expansion. They have an extra room with nothing in it at the current time. No competition and its currently in a strip mall with a hair salon next door, a vet clinic and some other smaller stores. The area is a good one and It use to be a potential place at one time with a good rep.

As for the gross, I think they could pretty much show me anything that is promising, but that doesn't mean its accurate.

Tanning Queen · 14th September 2006, 03:04 PM

Of course they are gonna tell you it is a good profit maker. LOL! You need to see their tax returns and also run some reports off of the software they are using.

When I said room for expansion, I meant some real space. Not just one room. You cant make much more with only one bed. Maybe there is an open storefront next door or something.

When you say no competition, does that mean in the shopping center or in a 5-10 mi radius?

Sometimes adding on more electric is harder than you think. I had problems and they were going to have to dig underground to bring in a new line to the store. Would have cost me waaaaay too much $$ to bother with such a small store. So, it could be cheaper to move to another location where it is easier to get it in when you are doing a build out.

Ask them what their terms on the lease are and ask to look at the actual lease. They might not have an exclusivity clause in there so anyone might be able to put a salon in right next to you. IF they dont have a right of first refusal, you could get booted if the landlord wants to. If they dont allow them to assign the lease, you are screwed there too.

Demographics are still needed in the area. What is the population? Income? Nearest competitior? Etc.

daredvl_edm · 14th September 2006, 06:01 PM

I doubt I would be able to see their tax return until there was some kind of deal made up though. As for software, well that won't be happening. They don't have any. I am telling you this place has potential, but this person has no idea on what she is doing I am gathering. There are no competition around for about a 10 mile radius at least.

How would I find out about the extra power then? Is this something for the power company to give me an estimate?

I haven't even spoken to a lawyer to find any of this out at all as of yet. As for Demographics, the location is on a busy intersection in the area of condo's and other residentail housing. The demographics would probably be about a 10 000 people area.

Tanning Queen · 14th September 2006, 06:09 PM

So you have NO data to back up what they are telling you? Are they on a card system? So much for DIN's idea of computer issues

To see their taxes, you would have to sign a disclosure of some sort. A laywer would help there. Electric, have to checkc with your local provider and see what they have going to the store and where the drop line is.

Honestly? I think you should open up a brand new place across the street. I dont think they have a salon to sell...

daredvl_edm · 14th September 2006, 07:02 PM

Starting a new one would be a good idea, however aren't new beds rather pricy to start up in the beginning. I don't really want to lease as you would have enough payments every month coming out.

daredvl_edm · 25th September 2006, 03:09 PM

I would like everyones input and suggestion on this salon. The Salon is in a fitness center, has T Max Manager, Helios software. The equipment are One stand up _ Sundome XL-48 48 bulbs, One Solaris Gold Series 36 bulbs, 2 Sunstar Speed System 32 bulb. Stereo system in cluded. 69 900 is the asking price. 1100 is the lease terms for 4 years. Sounds like a good purchase. Last year they did a net income of $3200, which isn't much. Keep in mind its been open for 2 years and their is room for growth. What is everyones opinion on this one.

Din · 25th September 2006, 03:37 PM

Quote:

Originally Posted by daredvl_edm

I would like everyones input and suggestion on this salon. The Salon is in a fitness center, has T Max Manager, Helios software. The equipment are One stand up _ Sundome XL-48 48 bulbs, One Solaris Gold Series 36 bulbs, 2 Sunstar Speed System 32 bulb. Stereo system in cluded. 69 900 is the asking price. 1100 is the lease terms for 4 years. Sounds like a good purchase. Last year they did a net income of $3200, which isn't much. Keep in mind its been open for 2 years and their is room for growth. What is everyones opinion on this one.

they net $3200 in a year? This isn't a business.....i made more on my paper route when i was 10. You would pay $70,000 to make $3200? How many years would that take to break even.....lets calculate....approx 21-22years you'll break even.....great investment. I sure hope there is a typo somewhere......

daredvl_edm · 25th September 2006, 04:09 PM

Oh I so know what you are saying Din, but do u think there is room for growth. The place is in a busy fitness center. I will find out more today meeting with the realtor.

Porsha · 26th September 2006, 12:42 AM

Room for growth? Okay? Let's say you go up 1,000 percent? What are you thinking?

Drew · 26th September 2006, 09:37 AM

Lets just say, there isn't room to NOT grow now is there. Can you identify just what exactly they are doing wrong? What is their ppa? If it is under 10, you have a lot of room to improve.

15th July 2006, 01:59 PM	#63 (permalink)
tangenie All Star Join Date: Nov 2005 Location: Arizona Posts: 113	Go to the salon and work there for a few days and watch what happens. Your schedule may not permit, but if I were you I would want to go inside the business and watch it for a few days and to really see how the salon operates, how well the girls are trained and how many tanners come through the door. __________________ It's a great day to be Alive! Tim Schinker - President THREEWISHESTAN.COM

13th September 2006, 02:40 AM	#64 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	absentee owner I am wanting suggestions and thoughts on this one. I was looking into purchasing an existing Tanning Salon for $59 900, own customers, 2000 in the system aproximately 1300 are active right now. 5 beds, one base, 3 high intensity, and one stand up. Well as I am doing my homework on the tanning industry, the price drops to $50 000, however the owner is absentee from the new ad they have posted in the paper. I am seeing issues here! 1. If the owner disapeared, people got screwed in their purchases. 2. Is it even feasable to start over from scratch as these current customers are probably pissed off. Any suggestions and thoughts on this please. I mean, it could be good, but as it stands, ya the cost is good, but the reputation is shit.

13th September 2006, 04:31 AM	#65 (permalink)
missmojorising Hall of Famer Join Date: May 2005 Location: Simplytantexas Posts: 1,645	What kind of equipment? I'm doubting 1300 are activly tanning in September but that could just be me. __________________ "Analyzing humor is like dissecting a frog: Nobody really enjoys it and the frog generally dies as a result." E.B. White Mojo's Motto; Hire A Professional Consultant.

13th September 2006, 12:06 PM	#68 (permalink)
Din Smartass Canuck Moderator Join Date: Feb 2005 Location: Canada Posts: 9,130	They could have had computer issues and only put in their active users back into system instead of all of them. Know from experience. It's a possibility don't rule that out. __________________ www.ChronosMarketing.com ____________________________________________ The problem nowadays is stupidity. Why don't we just take the safety labels off everything and see what happens?

25th September 2006, 03:09 PM	#76 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	Re: buying a business I would like everyones input and suggestion on this salon. The Salon is in a fitness center, has T Max Manager, Helios software. The equipment are One stand up _ Sundome XL-48 48 bulbs, One Solaris Gold Series 36 bulbs, 2 Sunstar Speed System 32 bulb. Stereo system in cluded. 69 900 is the asking price. 1100 is the lease terms for 4 years. Sounds like a good purchase. Last year they did a net income of $3200, which isn't much. Keep in mind its been open for 2 years and their is room for growth. What is everyones opinion on this one.

6th August 2005, 01:41 PM	#61 (permalink)
Pink Princess Pink Join Date: May 2005 Location: Florida Posts: 792	I know...it does suck.

31st March 2006, 09:56 AM	#62 (permalink)
babagrace Rookie Join Date: Mar 2006 Location: Pennsylvania Posts: 6	I am really new at all this and I really need some advice. I am getting ready to start my own salon and need to purchase my equipment. Any advice on the best beds to choose? What are hott right now, and what are customers looking for? I'm really at a stump on what to purchase.

13th September 2006, 08:56 AM	#66 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	The place had been open since 1994, so the beds are about 12 years old now. They are owned beds, not leased. The last owner has only run the place for a year, but the previous owners were there for aproximately 5 years. The beds themselves are Wolff systems.

13th September 2006, 10:10 AM	#67 (permalink)
Tanning Queen Moderator Join Date: Nov 2004 Location: Six degrees left of nowhere Posts: 5,056	Open for 12 years and they only have 2000 clients in the system? And yet 1300 of them are active? Sounds fishy to me. If the equipment is that old, the salon, AT MOST would be worth like $10k.

14th September 2006, 10:27 AM	#69 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	Just curious then, do you think I should ask for a lower price if negotiating, or just forget about purchasing it then. I mean the beds can eventually be upgraded and its clean and has potential. I think this manager just royally screwed up since she has been there for a year only. Yet she is an absentee manager which I am guessing means the place is closed down. The only thing I am concerned about is trying to rebuild a crappy reputation.

14th September 2006, 11:04 AM	#70 (permalink)
Tanning Queen Moderator Join Date: Nov 2004 Location: Six degrees left of nowhere Posts: 5,056	The only thing you are buying in a tanning salon is the equipment and any customers that have active packages. In this case, the equipment is worth like $100 each. If the rep is bad, the customers arent worth much either. How much is their gross/net profit? What are the terms of the lease and is is assumable? Is there room for expansion? IS there enough AC & electric to upgrade the beds? What are the demographics of the area? What is the competition? Those are some things you need to consider when looking to purchase a salon. Not just how many customers there are.

14th September 2006, 02:01 PM	#71 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	Well they told me the gross/net profit was good as they are busy, however it doesn't sound promising. As for the lease term goes, I tried contacting the lease company, and they were not helpful at all in which the lease agreement goes. All I know is they pay $1900/month. As for the AC and electric, I am not sure on any of that either at the current time. I know I would be able to add AC and electric but not to sure on what the capacity is set at right now. There is room for expansion. They have an extra room with nothing in it at the current time. No competition and its currently in a strip mall with a hair salon next door, a vet clinic and some other smaller stores. The area is a good one and It use to be a potential place at one time with a good rep. As for the gross, I think they could pretty much show me anything that is promising, but that doesn't mean its accurate.

14th September 2006, 03:04 PM	#72 (permalink)
Tanning Queen Moderator Join Date: Nov 2004 Location: Six degrees left of nowhere Posts: 5,056	Of course they are gonna tell you it is a good profit maker. LOL! You need to see their tax returns and also run some reports off of the software they are using. When I said room for expansion, I meant some real space. Not just one room. You cant make much more with only one bed. Maybe there is an open storefront next door or something. When you say no competition, does that mean in the shopping center or in a 5-10 mi radius? Sometimes adding on more electric is harder than you think. I had problems and they were going to have to dig underground to bring in a new line to the store. Would have cost me waaaaay too much $$ to bother with such a small store. So, it could be cheaper to move to another location where it is easier to get it in when you are doing a build out. Ask them what their terms on the lease are and ask to look at the actual lease. They might not have an exclusivity clause in there so anyone might be able to put a salon in right next to you. IF they dont have a right of first refusal, you could get booted if the landlord wants to. If they dont allow them to assign the lease, you are screwed there too. Demographics are still needed in the area. What is the population? Income? Nearest competitior? Etc.

14th September 2006, 06:01 PM	#73 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	I doubt I would be able to see their tax return until there was some kind of deal made up though. As for software, well that won't be happening. They don't have any. I am telling you this place has potential, but this person has no idea on what she is doing I am gathering. There are no competition around for about a 10 mile radius at least. How would I find out about the extra power then? Is this something for the power company to give me an estimate? I haven't even spoken to a lawyer to find any of this out at all as of yet. As for Demographics, the location is on a busy intersection in the area of condo's and other residentail housing. The demographics would probably be about a 10 000 people area.

14th September 2006, 06:09 PM	#74 (permalink)
Tanning Queen Moderator Join Date: Nov 2004 Location: Six degrees left of nowhere Posts: 5,056	So you have NO data to back up what they are telling you? Are they on a card system? So much for DIN's idea of computer issues To see their taxes, you would have to sign a disclosure of some sort. A laywer would help there. Electric, have to checkc with your local provider and see what they have going to the store and where the drop line is. Honestly? I think you should open up a brand new place across the street. I dont think they have a salon to sell...

14th September 2006, 07:02 PM	#75 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	Starting a new one would be a good idea, however aren't new beds rather pricy to start up in the beginning. I don't really want to lease as you would have enough payments every month coming out.

25th September 2006, 04:09 PM	#78 (permalink)
daredvl_edm Its all Relative!!!!!!! Join Date: Aug 2006 Location: Edmonton Posts: 239	Re: buying a business Oh I so know what you are saying Din, but do u think there is room for growth. The place is in a busy fitness center. I will find out more today meeting with the realtor.

26th September 2006, 12:42 AM	#79 (permalink)
Porsha All Star Join Date: Jun 2006 Location: Wherever I want Posts: 71	Re: buying a business Room for growth? Okay? Let's say you go up 1,000 percent? What are you thinking?

26th September 2006, 09:37 AM	#80 (permalink)
Drew Hall of Famer Join Date: Nov 2004 Location: Ca Posts: 2,890	Re: buying a business Lets just say, there isn't room to NOT grow now is there. Can you identify just what exactly they are doing wrong? What is their ppa? If it is under 10, you have a lot of room to improve.

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