Bought My First DELCO Today

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Pizza_Boom

New member
:shock: Ok So I had the choice to dive off the rim of the Grand Canyon without a parachute or buy a local franchised DELCO
I chose the harder of the two and Bought the DELCO…
From Reading THE THINK TANK I feel there is a community here to help me and encourage me as I move forward on my new adventure.
I have been in the marketing and consulting field for 10 years and recenly decided to build a business for myself instead of other people.
there are still a couple of things to do and sign the papers to Start Operations on May 01, I feel all will be OK as long as the Wheat Farmers
continue to plant wheat and the world don’t go to (hell) in a hand bag in the next couple of years.
So Heres the Skinney,
This store is part of a Colorodo Based Franchise with about 25 Stores in the Denver area. The dough, meat, and cheese, is provided by the Commisary,
Store is currently owned by a multi unit operator that does not have the time or help to run this location; and sales, quality and business has suffered.
Sales are still at or above break even point, However Must increase to provide a income for Me… I feel my purchase price was very reasonable and will allow me to invest money in marketing to build the sales back up to a respectable level. The food cost is 23%, labor and utilities 20%, and I renegotiated a new lease that will put 500.00 back into the store per month. New lease terms give 1 month free with 50% reduced rent for 3 months. 1200 sq ft at 15.00+4.86 cam for ($1976.00mo)3 yr term .50c increse per year.
Compared to the Big3 in the area my location stinks. I am in the back of strip mall with very limited signage and visability. However, I am paying less than half the rent of prime retal space in this area. But will this help or hurt???
The demographics show this area to be very up scale with median income above 90k, will going to upscale Gourmet product Help with this area???
How much can I increase price from big3 promos and offer upscale menu and increase business. or will this idea sink the boat?
Thank You In advance for your input and assistance
Jimmi
 
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Hi

Labour and utilities 20% - combined? that figure just can’t be right.

Taking on the big 3 directly - they are marketing machines with name awareness - thats what they do - if you try and take them on that way you’ll need deep pockets so better to differentiate. Find out what it is that you can do different - there must have been something that attracted yourself to the store - think about it carefully.

However, with a poorly run store you will have an up hill struggle. Many will not try you again without seeing something different so make sure you promote ‘under new management’ very prominently and make sure you get to grips with the shop very quickly.

You say that you come from a different back ground - its a steep learning curve so be careful you do not bite off more than you can chew - if you do promote to early and you make a mess of it people who are giving you a go may not try you again.
 
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good for you!!!
when you have your first nervous breakdown,we will be here for you…
good luck and god speed.
 
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If you wanted a Colorado store that makes money you should have called me… Mine are for sale. LOL

Good luck!
 
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:shock: All agreements are in place, sign papers on Tuesday anything I Should be aware of before I sign besides everything, lol.
I am not considering moving at this time due to meeting new health code could cost 40K± current configuration is grandfathered and not required to meet new code unless moved or major remodel. I may consider moving or open another location, after a few months of positive cash flow
Current phone # is esablished 12+ years and several corporate accounts that just about meet the overhead.
Previous owner dropped the advertising and payroll and was meeting overhead with established customers.
1 driver and 1 helper on weekends…

So which is better,
  1. inexpensive location with low rent and ability to spend more money on fliers and direct mail
    or
  2. prime location across from the Papa and domino paying 2or3X rent
This is a regional franchise with regional name recognition and pretty decent pizza compared to papa j and domino

In my opinion people make their buying decision basied on the best offer in thier hand
add to this Big Daves Ultimate gurantee and accept all competitors coupons
Make a better Pizza, Give Great Service
Jimmi
 
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If you have not yet signed any contracts or lease agreements, I hope that you will very seriously consider not making this deal & walking away.
 
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Why In The world would I do that.
Because it is Hard???
Because alot of people fail???

there are two types of people in this world, winners and whiners.
occaisionaly a winner will lose and a whiner will succed
thats the thing about luck
My thought is the harder you try and the more you work at it the luckier you become

What would your benefit be if i decided to quity trying

All I Can Say to you Dude
If your not willing to be a part of the solution and the success
Go find a rock to crawl under and watch the fireworks
Failure is not an option
 
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So heres the real story

I am investing less than 10k in this takeover…
I am underfunded. My Back is aganst the wall…
I am not going to use 1 penny of my savings,401k, or equity in my home

I am keeping notes on all the choices I make.
ALL OF THE MISTAKES. and I will undoubedly make a few.
And all of the Good choices. I will make alot of these too.
All of the suggestions I recieve that work really well.
All of the suggestions I recieve that are less than profitable.
I will write a book about this Journey that will help others along their path as well.
I will make post letting others Know what is possible with a little hard work , A little inginuity
and a willingness to hang on to the boat when it appears that all will fail.

I am a consultant that is willing to walk the walk. Learn From MY Mistakes.
And Leave a trail for others to follow…

The book will be published in June 2009
Jimmi
 
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Pizza Boom:
So heres the real story

I am investing less than 10k in this takeover…
I am underfunded. My Back is aganst the wall…
I am not going to use 1 penny of my savings,401k, or equity in my home

I am keeping notes on all the choices I make.
ALL OF THE MISTAKES. and I will undoubedly make a few.
And all of the Good choices. I will make alot of these too.
All of the suggestions I recieve that work really well.
All of the suggestions I recieve that are less than profitable.
I will write a book about this Journey that will help others along their path as well.
I will make post letting others Know what is possible with a little hard work , A little inginuity
and a willingness to hang on to the boat when it appears that all will fail.

I am a consultant that is willing to walk the walk. Learn From MY Mistakes.
And Leave a trail for others to follow…

The book will be published in June 2009
Jimmi
Click to expand...
Mr Pizza Boom - You have asked for opinions here, and the extremely knowledgeable folks have shared theirs with you, regardless if you like the response or not. Yes, the unique that work hard, can take chances in life no matter the outcome, and go on. Seems to me… you are really “talk the BS”, I am not smug, nor am I counting my chickens B4 they catch. And I appreciate all the experience that is shared here on this fourm.

BTW - Opening 1st shop on Wednesday, April 30th…I am not as fortunate as you…I have had to give up alot…and have used my equity, sold my Heritage Softtail…with an excellent credit rating…and realize that I could very well be living in a pizza box if not successful in a matter of weeks. So, you’ll probably say " Uneducated Dumb Azz" and I could give a S***!!! But, at least I gave it my all…and my meatBalls are bigger than yours!!! This is about passion…not freaking ####'s

Smarten up Bud…These guys are here to help…Always!!!

And at the end of the book, gee how does it go…

THE END

Andrea
 
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On the contrair my dear cream puff, I respect you greatfully for your intestinal fortitude to invest in your dream and go for it.
It seems one of these educated, experienced, professionals, “extremely knowledgeable folks” you have refered to has only one piece of advice and that is to quit before I get started. Sorry for the inconvienience but like you quitting is not in my vocabulary.
and your right, I got miffed when I read his reply and went back and read all his post to others and concluded his experience (and I may be wrong) as a pizza maker is opening a totinos box and throwing it in his oven at home… There are many here that are greatly experienced and who’s opinions I value greatly, Big Dave Ostrander, Tom Lehman, Steve… Bodegahwy.
However there seems to be a few that would not know the difference between the crispy side of a pizza and the greasey side…
I am greatly interested in you experiences and hope for your quick success. I havent seen any mattresses in a pizza box that would be very comfortable. I can’t curl up on the seat of my shovelhead either. I am sorry you had to sell your softtail. sux to sell toys to finance dreams…
My life has been about helping other people achieve their DREAMS.
Now for a while it will be about feeding their need for GREAT PIZZA.
I hope all go’s well for you and your pizza shop. best wishes and good luck

As for your meat balls, they probly taste sweeter too…
Jimmi
LIVE LIFE WITH NO REGRETS AND IF YOU EVER DOUBT ANYTHING, DOUBT YOUR LIMITS!!! 😃
 
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You might want to see a shrink before actually signing the papers!

Having a dream and jumping into it is great, but doing it blind folded and saying you have to take the chance, is just crazy. Do more research before you make such a big commitment.
 
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Thanks for the kind works above. I hope you still feel that way after my comments here.

There is not really enough information here for outsiders to know what the situation is. On the other hand, if an experienced and presumably succesful multi-franchisee is walking away for 10K, I would want to be sure I understood why before putting in the time and effort. The cash will be the least of your investment.

If you can put your finger on why the location has done poorly and feel that you can correct that I would say go for it. If you are unsure why the location has fared poorly I would want to dig a little deeper. My own first store was a failed national location. The failure was not connected to the location. I bought 300K in tenant improvements and equipment for 35K. It worked out very well for me.

If the base level of sales is breaking even I wonder why a multi-store owner would drop the store. Generally a multi-store operator has some cost structure advantages over a single store operator… which leads to:

Have you had an accountant go over the numbers? How about an experienced operator?

One thing I wonder about in a multi-store situation like this is whether the labor is being fairly apportioned or if some labor used at this store is being paid for elsewhere to put “lipstick on a pig”. Same for food cost. Some other cost centers like insurance or even phone service might have blended billing that is misleading.

10K is less than good ovens are worth. There is no free lunch.
 
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There is something just not right about this.

food cost 23%
labour and utilities 20%
rent 1976 pm.

Labour at the weekend is one guy, a helper and a driver.
You have no experience in this type of business other than reading a few boards.
You are investing just $10k in the business - and have no other money to put in.

If you can not see that the first three figures the fact this guy has less staff in than most have in on their quietest nights, and that you have no money to advertise then you are in for a real surprise.

The fact you have yet answered the question about labour and utilises makes me think you do not have a clue what you are about to get into. Even some of the best operators here would struggle to operate at 23% food cost. Oh yes, and you think you’ll have time to write a book and you’ve already got a finish date for it.

Why on earth post on this board asking for comments/help but whenever anyone has posted you’ve either ignored, defended or lectured?
 
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Some really experienced guys are pointing out some red flags to reseaqrch before jumping in the deep end of the pool. It may be just fine, but there are some disconcerting gaps in the information you gave us in order to give advice.

$10K for a racehorse could be a good deal . . . same money for a sway-back mare is another story. Be SURE you had someone look at those financial numbers from previous beside you . . . you have no ability to analyze and assess their validity.

It sounds like you decided to do this deal before you posted, so give us some direction what advice you want at this point.

In your words, you are underfunded, have you “back against the wall”, have no pizzeria or even food-service experience, and have no personal skin in the game. That is a classic set of hurdles that doesn’t bode well for short term viability of your project.

I do wish the best anyone who buys into our little fraternity of hard working pizzeria guys. Let us know more about what you want, and we can give a shot at offering experience and information.
 
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Pizza Boom,
I am guessing my comments to walk away from this deal is the source of your agitation. Based upon your comments in reply, my advice is unchanged. Bodegahwy is one of the most savvy posters on this board, do a search on his posts…he is the real deal. Wizzle Wassell’s comments should be hitting you straight in the bread box.

Are you personally guaranteeing the lease?
 
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“read all his post to others and concluded his experience (and I may be wrong) as a pizza maker is opening a totinos box and throwing it in his oven at home”.

Pizza Boom,
I’m guessing that’s directed at me. Good luck to you. I will no longer be commenting on this thread.
 
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Sorry It appears that I have not answered your question
But here go’s with as much detail as I can at this Time

this store is in very prominate and upscale neighborhood with a owner that has his mind on other ventures. Unfortunatly he is a forigner in a predominatly white upscale area. He is one of the most likeable people you would ever want to meet, a truly great guy. I hate to admit that there are still predudice people in this country but there are… I am not prejudice and wish that no one was. The owner has some issues that do not allow him to relinquish controll of the store to someone that could manage it and increase the sales. so his other option is to sell it… recoup a part of his investment and concentrate his efforts on his first love and recover his losses from increased sales there.he has been doing the job of 3 full time employees with minimal help. 1 driver and 1 additional pizza maker on weekends. he delivers himself and makes pizza. the labor cost are true, the utilities are 650.00 per month avg. at lunch he closes trhe doors to deliver himself and answers forwarded calls on his cell.
I have seen several orders 10/20+ pizzas in the few hours i have been there to observe.

I am very passionate and feel my determination and desire to turn this store arround is the key to success vs the lack of sales.
to use an aforementioned proverb i believe this is really a race horse in a swayback disguise.
franchise says this store has seen figures in high 50k month sales.
another option down the road is to drop the name and restart from scratch if the name is really hurting this store

Jim
 
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“In your words, you are underfunded, have you “back against the wall”, have no pizzeria or even food-service experience, and have no personal skin in the game. That is a classic set of hurdles that doesn’t bode well for short term viability of your project.”

I am not in this for the short term, and in the short term plan to reinvest cashflow into remarketing and rebuilding this store.
I believe that the customers deserve a great pizza and I ultimately deserve to make a living.

I feel my experience in marketing, and team building will put in place a winning DELCO that will be second to none in quality and service.

Besides sitting at home watching reruns of law and order is getting old,

Jimmi
 
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