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system
Guest
Hi, I am looking at the purchase of a pizzeria.
The store does $17K a week in sales.
The rent is $4000. Electricity and gas is $1800.
It is a busy area (in a major city) with a medium
sized university nearby. The main competitors are Papa Johns and Dominoes. Independents do exist (two) but are a little farther
away.
They have stated that Fri/Sat nights can have as much
as 12 drivers, 4-5 people inside. Weekday lunches have
2 inside, 2-3 drivers.
The store is 85% delivery, no seating.
The store is open extremely late hours: til 2 or 3 am, 7 days a week.
The current owner has only owned for 9 months and thus
only has limited data as opposed to a proven track
record of 3+ years. Apparently, they have near tripled
sales in just 9 months-- 6K a week to 17K a week. To
me this is a big red flag.
I have my own doubts when it comes to verifying sales.
Although a 2 week due diligence period has been
allowed, can’t they just have their friends just call
in fictitious orders to inflate sales?
Should i have a misrepresentation/fraud clause written
into the contract so that i’d have the right to sue if
i have to?
I’ve scoped out the store and it seems pretty busy. My
personal estimate is 13-14K a week, although i really
doubt they use 12 drivers.
What do you calculate for the net profit/owner
benefit? (a range is fine)
How much is a fair value price for this business, in
your opinion.
This will greatly help in my proceedings in buying a
business. I would greatly appreciate any help. Thanks
in advance for your assistance.
The store does $17K a week in sales.
The rent is $4000. Electricity and gas is $1800.
It is a busy area (in a major city) with a medium
sized university nearby. The main competitors are Papa Johns and Dominoes. Independents do exist (two) but are a little farther
away.
They have stated that Fri/Sat nights can have as much
as 12 drivers, 4-5 people inside. Weekday lunches have
2 inside, 2-3 drivers.
The store is 85% delivery, no seating.
The store is open extremely late hours: til 2 or 3 am, 7 days a week.
The current owner has only owned for 9 months and thus
only has limited data as opposed to a proven track
record of 3+ years. Apparently, they have near tripled
sales in just 9 months-- 6K a week to 17K a week. To
me this is a big red flag.
I have my own doubts when it comes to verifying sales.
Although a 2 week due diligence period has been
allowed, can’t they just have their friends just call
in fictitious orders to inflate sales?
Should i have a misrepresentation/fraud clause written
into the contract so that i’d have the right to sue if
i have to?
I’ve scoped out the store and it seems pretty busy. My
personal estimate is 13-14K a week, although i really
doubt they use 12 drivers.
What do you calculate for the net profit/owner
benefit? (a range is fine)
How much is a fair value price for this business, in
your opinion.
This will greatly help in my proceedings in buying a
business. I would greatly appreciate any help. Thanks
in advance for your assistance.