Want to know this store is making money or losing money. - ASK미국

e**mki**** 님 답변 답변일 2/2/2011 6:26:45 PM

You forgot more important things. What kind of business is it? Any how much does it cost for buying raw materials? Anyway in your case the fixed cost is 30% ($11483/$386000). This cost might be high or low depends on the business type. And you can find appropriate business sales agent in this web site also.

b**ash**** 님 답변 답변일 2/2/2011 6:39:40 PM

ask them to show you how much tax they paid. agents lie all the time. what kind of shop is it? best thing to do is to ask near by shops how well they were doing and stake out and see how busy they are.

m**tlove**** 님 답변 답변일 2/2/2011 6:44:37 PM

hi,. thanks for quick response. this one is retail clothing store.
owner provided me sales reports, it says that
annually net sales: 386000$
cost of goodls purchases 167,500
sales processing bank fee: $ 7650$
total cost of goods sold : $ 175,200
gross profit: $ 210,370

Expenses like this.

payrolls: $ 51587
insurance: $ 1866
license and permit: $ 156
rent: 79,951$
security: $ 311
supplies: $ 2849
tax property: $ 63
phone: $ 1691
utilities: $ 6142

total expense: $ 145,006

I igored some cents on sales. trying to make even to count easier.

owner told me net ordinary income before taxes: 65,369$

this store is really making money or losing money? my plan is reducing some of workers and doing much time by myself.

or recommend me some good escrow company or agent.

I don't know anyone here. thank you so much.

m**tlove**** 님 답변 답변일 2/2/2011 6:50:29 PM

Yes, I did many times to check out stores outside for several other stores. but I feel very uncomfortable doing that. so I want to open escrow to figure out this store.
but I've never make an offer yet. that will be my first time.
and everyone knows these times are very slow economy. and always wonder why he wants to sell.
he's been doing this for 15 years. and absentee owner operation.

I just believe if I'm doing more time for this, it would be more profitable and safe.

heard that to open escrow, I need to put deposit. but can be returned back if i don't like it, right?

To beavis, owner told me this one shows that he returned taxes.

m**tlove**** 님 답변 답변일 2/2/2011 7:44:47 PM

hi, minerva, are you sure what you said about this?
could you at least explain why that is not good to buy? very thanks but i really need you to convince me.
that's why I'm asking this to people who knows business and experts here.

i**rysu**** 님 답변 답변일 2/2/2011 7:48:42 PM

Income before tax is already too low. If you pay tax, how much can you expect to get? There is possiblity you will get nothing or loss after tax. I think it is good business to invest when you can recover your investment within one year. But if you know the business very well and you may know how to improve, maybe it can be a chance.

m**tlove**** 님 답변 답변일 2/2/2011 8:09:38 PM

hi, gu. thanks. yes, that's why i;m asking to make sure.
I want to take chance if this one is not a bad business. that income before taxes 65369$.
how much taxes do I need to pay? so how much income will be?

this one is running by only workers. owner doesn't work so, if we consider owner's not working may be
good business?

2008 was income before taxes 135,183$
and 2009 was 65,369$. it's almost cut half off sales.
but i can say that year start losing money for all of business.
i don't know 2010 year sales. only can check if opening escrow.

b**ash**** 님 답변 답변일 2/2/2011 10:37:46 PM

chances are the seller might ask you to put down more than a deposit when you open a escrow. that's how typically koreans sell their businesses. if you decide not to then they are going to keep the money. it's best not to hire a korean escrow company. rent seems to be too high and other numbers look fishy. if i were you i wouldn't buy it.

b**kerdh**** 님 답변 답변일 2/2/2011 11:39:14 PM

You have too many unknowns to be a clothing store owner. DO NOT BUY!!!

2008 was worse than 2007, 2009 was worse than 2008, and 2010 was worse than 2009 for almost all small businesses in the US. The number you have is for 2009 -meaningless if 2010 sales are lower than 2009. You do not have much cushion (only $60,000 or so net income) to absorb reduced sales. I bet you will have to pay the business out of pocket just to survive. The store will not pay you.

You don't have any experience in clothing retails, then don't do it. It's not like liquor store or general retail store selling standardized goods. 100% help run? I doubt it for the clothing store. Owner is the one who does purchasing for this type of business.

You don't even have an idea of how to buy an existing business. You do not open an escrow without having your offer accepted by the seller. Trusting Korean escrows or agents (mentioned ahead of me) shouldn't be a subject here. No matter what they say, you should have your own firm logic to justify your buying decision.

In many cases I've seen, doing nothing is netter doing something, i.e. running a losing business.
I wish I could help you better if time allows. Look for other type of business.

b**kerdh**** 님 답변 답변일 2/2/2011 11:50:58 PM

Correction for typo in the last paragraph (weird small fonts in 글올리기)

doing nothing is better than doing something.

Please don't get offended. I WANTED YOU TO BUY SOME OTHER TYPE OF BUSINESS TO SAVE YOUR SAVINGS AND INVESTMENTS.

m**tlove**** 님 답변 답변일 2/3/2011 12:10:37 AM

hmm....to 김동화...
really? seller is not korean. and he only purchase items for store, and I've been to shop to check. he doesn't work. only he focuses on buying items.

he offered me 2007,2008,2009 sales. not 2010.

I have lots of experience for clothing store. and I don't get mad about what you said to me. I just want to buy right business for me. I like this store. but doing business is for money not just for fun.

I'll take everythings you guys said gladly, and I just feel you don't need to ask me about experience.
I know what I like to do and to do. just if i take bad store, I'll be in much trobles and my credit also will be affected to some extent.

just wanted to ask this before meeting agent.

thanks for give me an different idea. my plan is buying home for residence. but to do that, I need to prove
more money that I can make. and some savings and cd makes a little interest. that's not that worthy.

my email is hotchoco801@hotmail.com if someone might help me count this profits, email me please.

m**tlove**** 님 답변 답변일 2/3/2011 12:15:10 AM

don;t know. it just makes a lot of thoughts. people here recommend not to buy.
in this location, there is one vacant space. I can may take that empty store or take this well decorated existing store for 15 years.
selling price is small, rent is high.

m**tlove**** 님 답변 답변일 2/3/2011 12:27:34 AM

계산해보았는데 제가 한걸로는 약 4300불 매달 net 인컴이 그렇게 나오는데요. 원 맞는건지...
(employees payroll 빼고)

t**inr**** 님 답변 답변일 2/3/2011 2:06:51 AM

I think mintlover has made up mind to buy the business and want all of you to approve. If mintlover has a lot of experience as he/she said in running this thype of business, he/she does not need to ask questions in this forum.

c**a**** 님 답변 답변일 2/3/2011 4:44:48 AM

가게 가격과 리스는 얼마나 되는지요?
예를 들면 30만불인지? 아니면 10만불인지 그래야 좋은 가격에 사는지 아니면 조건이 아주 나쁜지 더욱더 구체적이겟네요. 모게지를 얻엇는데 지금게산으로 모게지내고 생활해야 하니깐요.

p**digy**** 님 답변 답변일 2/3/2011 8:35:37 AM

DO NOT GET THIS BUSINESS, SINCE YOU COULD TAKE LITTLE PROFITS FROM IT OF COMPARING YOUR INVESTMENT. THEY MAY HAVE A LOT OF INVENTORIES TOO.
YOU'D BETTER PONDER OTHER BUSINESS. THIS BUSINESS FELL BY THE WAYSIDE I BELIEVE.
IF YOU TAKE IT OVER THEN YOU MIGHT HIT ANOTHER ROADBLOCK.
SO I'M SURE YOU SHOULD THINK IT IS THE BUSINESS BEREFT OF HOPE.

b**kerdh**** 님 답변 답변일 2/3/2011 3:26:56 PM

beavis (barashu) says, "...agents lie all the time..." and"chances are the seller might ask you to put down more than a deposit when you open a escrow. that's how typically koreans sell their businesses. if you decide not to then they are going to keep the money. it's best not to hire a korean escrow company."

• - (mintlover) says,"really? seller is not korean.." -------- I did not say anything about the nationality.

It's sad to hear about stereotype Korean sellers, escrows and (Korean) agents from same Koreans. I call it prejudice. We should be proud of ourselves. In giving written advices, that should not be a subject..

Nowadays, I have spare time to help people in this forum with expertise of my career. I've been trying to help at least one a day, not anticipating anything in return but for my pleasure of helping. However, I do expect an inquirer to read my writing with care without misunderstandings.

m**tlove**** 님 답변 답변일 2/3/2011 4:43:51 PM

NO WAY~~nO NO
DON'T GET ME WRONG. MAYBE I HAVE SOME STEREOTYPE BUT THIS IS NOT THAT IS.
ONE OF PERSON HERE SAID THAT KOREANS DOES BLAH BLAH..... CHECK THIS OUT :beavis
BUT SOMETIMES AMONG KOREANS, THERE ARE SOME PROS AND CONS. EVERYONE KNOWS THAT FACT.
I THINK THEY COMMUNICATE WELL AND KOREANS ARE VERY SMART. :>

I HAD SOME BAD EXPERIENCE TOO WITH SOME KOREANS. BUT I'M KOREAN TOO. SO WHO BLAME WHO?

.....TO SOMEONE HERE ABOUT ASKING PRICE

IT IS UNDER 50K. SO COMPARE TO PRICE, YOU THINK THIS ONE IS GOOD ONE?

i**rysu**** 님 답변 답변일 2/4/2011 1:37:39 PM

With simple considerartion of number you provided, 50K sounds proper price if you don't use 2 part times. However If you keep present system, 40K will be proper business price as much as you can recover your investment in one year. Another condition is your satisfaction for imcome. If you satisfy $3,000 - 4,000 invome a month through this business, you can get it. Good luck.

m**tlove**** 님 답변 답변일 2/4/2011 8:17:09 PM

thanks to all the people here and especially to gu
THANK YOU~~~~
YES, I KNOW THIS RENT IS TOO HIGH FOR ME TO HANDLE AS A FIRST BUYER. BUT ASKING PRICE IS REALLY FINE WITH ME. I USUALLY THOUGHT ABOUT PRICE RANGE OF BUSINESS UP TO 150K. BUT
THAT WILL BE GONE HALF OF MY MONEY. AND 150K STORE DOESN;T GUARANTEE ABOUT INCOME.

THIS ONE, FIRST TIME I FELT A LITTLE FISHY. BUT PRICE AND INCOME JUST ATTRACTED ME A LITTLE BIT.

LIKE GU SAID, I'M REALLY O.K WITH 4000$ MONTHLY INCOME WITH 2 OR 3 PART TIME WORKERS.

I WILL BE IN STORE ALMOST 24/7 ( I MEAN IT) BUT IF EMPLOYEE WORK FOR DAYTIME, I WILL WORK FOR EVENING TIME. THIS SYSTEM IS THAT I PLAN FOR MYSELF.

NOW PRESENT OWNER PAYS 4300$ FOR EMPLOYEE. BUT I'LL CUT DOWN TO HALF. AND REST OF TIME,
I WILL WORK.
SOUNDS O.K?

IM GOING TO MEET EXPERT (AGENT) TO TALK ABOUT THIS AND I ALSO SCHEDULE TO TALK TO OTHER AGENT ON THE PHONE.

I'VE BEEN WORKING FOR RETAIL STORE SINCE I CAME HERE. SO IT'S ALMOST 6YEARS, I GUESS.

I FELT SICK OF WORKING AT OTHER'S STORE BY BEING PAID 8 $ OR 9$. ONCE I START WORKING AT OTHERS' , I REALLY DO MY BEST LIKE OWNER DOES. SO WANT TO CHALLENGE THAT.
AND IN THE NEAR FUTURE, I ALSO PLAN TO HAVE A BABY. I'M NOT PREGNANT YET.
THINKING ABOUT MY AGE, TIME TO HAVE SOON.

SOMEHOW, THANKS FOR READING ALL THESE.

GOD BLESSED YOU.

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Q.Want to know this store is making money or losing money.

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