Background on myself: After graduating high school 18 years ago, I (successfully) managed two franchise pizza stores (carryout / delivery), as well as one independent over an 8 year period. I LOVED the business, but needed better money and benefits when I met my GF, now wife, and moved on to spend the last 10 years in print production management. Over the past 10 years, we have gained a lot of stability in our lives, eliminated ALL debt, and built up decent savings. While I enjoy my current job, I don’t LOVE it, and it’s really just going through the motions.
I have recently been in talks with an owner and his broker that are selling a small carry out / delivery shop, with a small 10 seat inside area. Vast majority of sales are form carry out and delivery. Central area on a main street with GREAT traffic counts. Neighboring area ranges from middle class, to very affluent.
Seller claimed numbers which will be verified (as much as possible):
$209k gross sales for 2017
COG running about 32% of sales. If we assume 35% - this equates to roughtly $73k
Rent and utilities is running 15% of sales. Round up to 20% to be conservative and you have about $42k
3 PT employess (cook and two drivers)
Husband and wife owner operators - husband is VERY hands on.
Phenomenal and plentiful Google and Yelp reviews (4.9* on Google - 60 reviews).
VERY limited current hours. Closed Monday, only open until 9pm during the week, Bar next door is busy, serves NO food, is begging current owner to stay open later on weekends (Bar open until 3am - pizza shop closes at 10pm)
Nearby community college campus and a large 50k plus resident retirement community.
No or very minimal marketing.
Bakers Pride ovens, Hobart mixer, clean shop, LOW rent.
Wife will keep fulltime job initially for benefits, so we basically need to break even while we build a brand. I currently work a 70 hour a week full time job and am totally comfortable with “Living” the business for several years to get it positioned correctly.
Seller is asking $119k.
Going to look at this later today. Owner is willing to let me show up several days “unannounced” to shadow him and watch the business in action.
Anything I should look out for, pay special attention to, or immediate concerns?
Thanks for any advice!