Open Shop?

[system]

In my small town of 2,000 people there is a building for sale for $150,000. It’s a mall of sorts, it has small shops inside, 6 current tennants,(barbers, realestate agency, etc. I would like to buy it and put a drive up pizza place inside.
There was a bank on the back that had a drive up window. There is plenty of space to make a restaurant and I want to run a pizza restaurant. I would plan on starting with a drive up restaurant to allow for startup with no need to hire employees, just my wife and I.
Assuming payments are $1500/mo. with taxes, and tennants pay only $600, I would be left with a $900/mo. rent/mortgage. I’m sure this is very low compared to what almost anyone would expect to pay. Is this a no-brainer?
The town has a pizza place, its miserable, and some people drive 30min to get better pizza. The gas station has a Piccadilly Pizza thing in it, needless to say it’s not real good, but I think most people would say its better than the restaurant. Given this info do you think this calculates into a good investment? How much do you think would be good range for revenue?
Other pizza is priced about: 1top 14" $9.99 $1.50/top - no one delivers

 

[Integraoligist]

in a town of only 2000… how close is the next nearest town? I would’nt sell yourself short right out of the box, get 2-3 drivers and start it up with delivery. Because if you don’t, later on when you DO add delivery you’ll be kicking yourself because your delivery business is slow… everyone in town would have already tried your pizza and they know you do not deliver.

I’m in the middle of 3 towns, each holding about 5500 people… we did’nt start delivery until 6 months after we opened… it’s been over a year and a half and you would not believe the amount of people that come in and notice that we now deliver!

It took my delivery 6 months to start genterating from 0% to 55% of my overall business.

just my $.02

 

[SAL]

If the real estate is a good return on your money maybe…if its $150,000

you should net into your pocket a minimum of $10,500 a year in net rent…
if its lower than that …don;t even bother…

I don;t know why you would want a pizza store in an area with 2000 people…that is hardly worth the effort…even if you have the best pizza around…I don;t get it…

SAL
pizzadreams:

In my small town of 2,000 people there is a building for sale for $150,000. It’s a mall of sorts, it has small shops inside, 6 current tennants,(barbers, realestate agency, etc. I would like to buy it and put a drive up pizza place inside.
There was a bank on the back that had a drive up window. There is plenty of space to make a restaurant and I want to run a pizza restaurant. I would plan on starting with a drive up restaurant to allow for startup with no need to hire employees, just my wife and I.
Assuming payments are $1500/mo. with taxes, and tennants pay only $600, I would be left with a $900/mo. rent/mortgage. I’m sure this is very low compared to what almost anyone would expect to pay. Is this a no-brainer?
The town has a pizza place, its miserable, and some people drive 30min to get better pizza. The gas station has a Piccadilly Pizza thing in it, needless to say it’s not real good, but I think most people would say its better than the restaurant. Given this info do you think this calculates into a good investment? How much do you think would be good range for revenue?
Other pizza is priced about: 1top 14" $9.99 $1.50/top - no one delivers

 

[NicksPizza]

SAL:

I don;t know why you would want a pizza store in an area with 2000 people…that is hardly worth the effort…even if you have the best pizza around…I don;t get it… SAL

1. Intangible benefits
2. Challenge
3. Business Growth with Community Growth

 

[SAL]

NicksPizza:

SAL:

I don;t know why you would want a pizza store in an area with 2000 people…that is hardly worth the effort…even if you have the best pizza around…I don;t get it… SAL

1. Intangible benefits
2. Challenge
3. Business Growth with Community Growth

Yes…but I still don’t get it…nothing wrong with a challenge …but this type
of challenge is for someone who can afford to lose…maybe pizzadreams
can afford to lose his money and he is bored…
he gets a challenge and has some fun…that;s a whole different world …very few can afford the above scenario…

of course it his money…but I wouldn;t touch it at all…or would it even cross my mind unless the real estate as a whole is at minimum a 7% CAP rate on your investment…and you have some pizza experience and you don;t need the income…then have at it…

my 2 cents…

SAL

.

 

[SMITH_JOHN]

I SEE A POTENTIAL TO MAKE SOME MONEY IN THIS SITUATION.
MY FIRST PLACE HAD EVEN LESS POPULATION THAN THIS,DID PRETTY GOOD…INTERGRAOLIGIST IS CORRECT WITH DELIVERY AT THE START.
READ SOME OF TOMMIEKNOWSPIZZA 'S POST’S…

 

[NicksPizza]

SAL:

NicksPizza:

1. Business Growth with Community Growth

Yes…but I still don’t get it…nothing wrong with a challenge …but this type
of challenge is for someone who can afford to lose…maybe pizzadreams
can afford to lose his money and he is bored…
he gets a challenge and has some fun…that;s a whole different world …very few can afford the above scenario…

I very much agree that it is not for everyone . . . . I also do see value in my original #3. A little patience can pay off large. I have experienced about 85% gross increase in 4 years in my 2500 person town. Lots of work and lots of sweat . . . paying off all in all. I’m not taking $100K a year to the bank, but neither does my life svck.

PizzaDreams, it is a difficult road operating in a small, rural population. If can be done, but you need some population centers nearby (within 10 mi.) where you can draw dine-in market to you. Running a DelCo in that small of a location without some sort of college/military/apartment complex to capitalize on can eat your life and money like a crack addict on a bag of potato chips.

 

[SAL]

I do not know how many square feet you actaully have at this location.

I would assume a small town like yours probably does not have
a movie theater either…

Build a small private theater …say 12 leather motorized theater chairs…
a 130 inch screen powered by a nice DLP high end projector and put in a dynamice surround system…you only need 800s2 ft

people can rent it in 3 hours blocks…bring their own dvds eat some pizza…etc…great for kid birthday parties…and sporting events too…

may make it worth while…

SAL

 

[snowman]

I see NO value in this venture. $150k for a building that will cost you $900 a month. This is before CAM and all headaches that come with being a landlord.

I see this as a money-loser from the building AND as a pizza joint. No matter how bad the current pizza joint is, it has loyal customers and may keep disloyal customers based upon price, etc.

$900 a month in rent for a pizza joint building in a town of 2000 is way, way, way overpriced. Unless you’re getting several thousand square feet, you’re losing money on both ends. I can’t imagine that a drive-up bank has more than 1000 sf in that size town.