View Full Version : Buying a mat
I am looking into buying an existing franchise. The facts that I have thus far are:
-3500 sq ft
-lease 2750.00 included in lease CAM, sewer, water, and property taxes.
-asking price 120,000
-year established 2002
-35 washers
-33 dryers
-dry cleaning service outsourced to a dry cleaning company
-Yearly revenues $76,627
-Yearly cash flow $30,354
-value of equipment is $80,000
the thing I am wondering is that it states that cash flow type is "seller's discretionary earnings"? What is the meaning of this from other owner's experience. Is this that the owner did not declare all of it's revenue.
RWSmith
02-02-2004, 11:23 PM
My guess is the owner does not take a weekly salary. But, they take money out when it is available.
I would get a CPA to take a look at the numbers and see if they can help.
Good-luck
My thoughts exactly. Thank you. Do you think they might even take salary out and not declare it and that is why it does not seem like they are taking a salary?
petefritz
02-06-2004, 11:13 PM
I beleive this reffers to cash flow. What the seller does with the money is not relevant. If you pay cash for this business, and work at it, than you should get the cash flow stated.
If you hire people to work it than that is discretionary spending. In the case of a big full service mat you will need some employess, but I think they figure you should be putting in a shift.
zorba
02-09-2004, 05:18 AM
My friend owns a liquor store and he says when selling they have a basic idea of what they go for, like 30 cents on the dollar of what you net. Does anyone knowif they have a such thing for a laundramat?
RWSmith
02-10-2004, 10:48 PM
Coin laundries generally sell for 2 to 5 times the yearly net. The terms of the lease and the age of the equipment is usually the determining factor in the price of the laundry. A coin laundry can be very difficult and or expensive to relocate so a long tem lease is very important and should be reflected in the price.
zorba
02-11-2004, 03:46 PM
I am looking to buy a laundromat (first time buyer) does anyone have any tips to ask the seller. I have been told to ask for 3 years tax returns to make sure they are making what they say they are, but anything else??
yankee
02-12-2004, 02:58 PM
Tax return means nothing to me,you can bring money from A business to B business or vise versa,
WATER BILLS,HOW MANY GALLONS USED will give you 90% facts(ask for last three years water bill )