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For small businesses, valuation is based on sellers discretionary earnings (SDE) SDE includes net income, owners wage, other discretionary add backs (car payments, telephone) that are personal expenses, that the seller puts on the business From your example the net income is 100k,i am guessing...

If the valuation based on cash flow is less than the amount they spent to build the franchise, they value the business on the build out cost, so that they can at least recoup the money they invested. That is the sellers logic. You should be able to negotiate it. Also franchise do command a...

I have been doing some thinking but fear that I missed something. This forum helps me think out loud and run my thoughts and ideas and get opinions from others? Few recurring concerns are Poke could be trendy and is a fad like Froyo. My observation is that Froyo was dessert and discretionary...

curious, is there any incentive for a customer to join your text messaging program?

Between 55 secs and 1:17, his body language is so like jerry seinfeld.

Lots of great points. Thank you gmac! You are right in that the barriers to entry are very low in Poke. But then it occured to me, isnt it same for burrito, taco, pizza place? So compared to Burrito, Taco, Pizza shop, what is the concern with low barrier to entry, with regards to Poke shop… Is...

According to the website for ‘Below40’ they only have 3 stores. I met with the owner/seller yesterday, and he told me that they are 100% oceanwise. Apparently, there is a gimmick there, whereby if you only shrimp from your entire sea food collection is “Oceanwise”, you can put the Oceanwise...

Thanks Andrew. Do you remember the name of the poke franchise or place. I think the fish has to be “sushi grade” for it to be used. So they cant cheap out much.

Thank you for your input, tguag. wow. $18 is expensive. But the prices here are $14 for fairly filling bowl. The $14 price point is the reason cogs are high too. I think the other food options are in the $10 to $12 range. The neighborhood it is in, is fairly affluent, office going crowd. The...

Froyo is tanking. I have seen a lot of froyos for sale. I think people just got bored of it. Their margins are huge, but if the revenue is limited, then margins are meaningless. The weather too plays a role I guess. So winter time, the business is running on loss. So unless they make their money...

You have valid point. I too thought the same initially. However what I think differentiates poke from froyo is Poke is meal, (made of rice, raw fish, veggies etc) Ppl have meals everyday. Froyo was dessert n not everyone has dessert everyday Froyo was a discretionary spend, but lunch n meals...

Great point Thank you

I hear you. But this is food business… It’s called poke. It’s new trendy Hawaiin raw fish bowls The numbers I provided above are fairly accurate But my dilemma is should I avoid this business cz the cogs are high, or should I buy it, cause it is profitable.

Wanted to get some general restaurant advice What do you guys make of food business with high cogs (45%), but still profitable cause of high sales. Rev:800k Cogs: 45% Labor: 25% Rent: 60k Misc: 5% (utilities, repairs, credit card) Net: 140k Should I avoid a business with such high cogs, or...

He does make 90k. 40% cogs 20% labor 8% royalties & ad fees 6% for credit card transactions, utilities, repairs etc 50k rent 20k local advertising So about close 90k net income to owner. Please find my answers No this is not a master franchise agreement. It is for single store. So I dont have...

I definitely would be keeping the papa johns name. This store that makes 650k rev and 100k in profit is asking 400k. But there was other store asking 250k. I also dont know if there is something wrong, that at least 4 to 5 stores, out of a total of 12 stores, are for sale in and around...

Unfortunately, I dont want give out location, cause I got NDA with broker. But the business is making 100k in profits with 650k revenue. My question was about There are tons of papa johns for sale around in nearby cities too. Over past 2 years, I see 4 to 5 out of the 10 or so stores, being...

Another interesting bit, though. There are a LOT of Papa Johns for sale here. There are about 12 papa johns in the neighboring cities, and in the past 2 years, I have seen atleast 4 to 5 for sale. Most of them are for sale in the $250k range, although I dont know what their revenue is. This guy...

Apparently the owner also owns another business and his wife used to run the shop. Now the wife is pregnant and the owner cant run the shop.

I agree. I think this was their promo when they opened the shop. The slowly cut it down over time I think.