New to the site and the business

[SimonC86]

I'm currently looking at a few laundromats that interest me. I have a question. These laundromats claim to gross 26k, 30k a month, but no bank slips to prove it. So the question is, How can I be sure? Is there a way to calculate their utility bills? Also how long do machines last for? There is a 7 year old business that I'm looking to take over in the near future if the numbers are correct. If anyone can help direct me to these answer that would be greatly appreciated. Thank you.

[Adamski]

Simon,

I assume Mr Seller is providing some records that you can take to your accountant. Discuss your concerns with him and see if he can extrapolate gross sales from the information you have.

[pressandclean]

Make the seller justify their numbers!

[surfflite]

If they claim 25K-30K/month, where are they getting this data? They definely have utiliy bills they could shown you, they ought to have bank deposit data, lease docs etc...

I've looked at at least 15 mats since I've bought mine. NONE of them could produce documentation to back there claimed worth. So I passed. Only 3 of them had any sort of books and those 3 had 2 sets, the "IRS" book and the "real" book. Well guess what? No bank will look at the "real" books, they only want to see to "IRS" books. You will be hard pressed to find a mat with accurate books (unless you look at mine, LOL) I document everything.

While having 2 sets of books may be fantastic while you own the mat, it will jump up and bite you when you are ready to sell. The business will be totally devalued because you can't claim the skimming part when trying to get financing.

[CanCanCase]

I'm currently looking at a few laundromats that interest me. I have a question. These laundromats claim to gross 26k, 30k a month, but no bank slips to prove it. So the question is, How can I be sure? Is there a way to calculate their utility bills? Also how long do machines last for? There is a 7 year old business that I'm looking to take over in the near future if the numbers are correct. If anyone can help direct me to these answer that would be greatly appreciated. Thank you.

I just bought a mat with dryers that have been working since they were installed in 1962. Machines "last" varying periods of time. Look at the bigger picture too. In my case, I've got a major rehab planned with all new equipment, so I honestly care a lot less when things break... I'm in "duct-tape-and-bailing-wire-mode" for the next 3-6 weeks.

Another interesting tidbit about my research on this particular mat... I was attempting to verify the seller's claimed revenue, so I spent a good deal of time at the mat before I bought it. I observed and counted customers, talked to the attendants, and drove by at many odd hours to count spinning machines to multiply out times the known vend rate. I came up with a low and high daily average that the seller had to be doing to reach the numbers claimed. Today I went to empty coin boxes for the first time... today's gross revenue divided by the 1.5 days since Mr. Seller emptied coinboxes for the last time came within $20 of my estimated high daily average. Granted, that's a potential $6000-$8000 error in my calculations, but based on $125K+ annual net, I'm happy with a 5% margin for error!

Now all I have to do is take my wife out for sushi to celebrate... I wonder if our favorite sushi bar will mind me paying the bill in quarters?!

-Case

[SimonC86]

Thank you all for the response. I will be going to the broker this Weekend to see some paperwork. They can not verify the income by bank statements. I was told the Water bill per Quarter is 4200 which is approx 1400 a month for water and sewage.

[Super Clean]

Now all I have to do is take my wife out for sushi to celebrate... I wonder if our favorite sushi bar will mind me paying the bill in quarters?!

-Case

Case,

When my grandfather was still around and the whole family would go out for dinner (21ppl) he would bring with him 2 or 3 bundles of quarters, $100 bundles of course and try paying with the quarters. My mom would usually get mad at him and he would get mad back and pay with them anywase lol.