[Money] How much to Dry Cleaners, Convenient stores, liquor stores, and bars make?

Don't forget Donut Shops.

 

when you get ready to get started, i know an attorney who can help you get set up, if you'd like.

 

I have 2 Aunt's that own dry cleaners. To buy an existing one, it will cost about 250,000 to 400,000.

I can't remember the total sales, but I believe take home money from them is about 50,000-80,000.

 

Holy crap, that's a lot of money...the return isn't as much as I'd thought, as for investment purposes,it'll take 5 - 7 years, to breakeven...Although I think I get ripped off at the dry cleaners...

 

Just think of all the change you find in peoples pockets... Now it's all worth it.

 

Once you get past first couple years, you can buy a pick up station for 100,000-125,000.That will give you twice as much business for the processing expenses of one.

Here in the SW Houston area, I know one family that owned 3 dry cleaning plants with 4 pick up stations. Needless to say, the mother and father both drove top of the line BMWs.

 

The type of car a person drives always determines their wealth status and economic value , i think it mentions that somewhere in the constitiution.

 

Well, they're nice cars! Call me shallow, its the fricken truth. Seriously though, they were doing well, nice house in Sweetwater et al.

Back to the question at hand...

Convenience stores could be okay, but its hard to turn into great money unless you have a killer location. I bet you that little store over by Fondren and Bellaire makes atleast 100,000/month in sales. Whereas, this little convenience store over on Dulles ave, some kind of stop and go, barely makes enough to stay afloat, maybe 80,000 sales for a whole year.

 

The answer to your question is that it totally depends. None of the businesses listed are concepts that have any type of competitive advantage whatsoever. Barriers to entry are incredibly low. As a result, they typically sell for 2x cash flow in a given year, and in the case of liquor stores, they can sell for as little as 1.5x inventory (when the building is leased). You've also got to be careful as to how they define cash flow. Many times they will have family members working at below market wages, which serves to increase their cash flow, but may decrease the buyer's. Of course there are exceptions on both ends of the spectrum. Go to bizbuysell.com and you can take a look at a ton of these types of businesses that are for sale.

Bars are somewhat of a different animal, in that they can be less of a commodity business. That said, they are notoriously difficult to finance, barriers to entry are low, employee theft can be high, liability is outrageous, and the hours you work will absolutely blow.

My advice: Learn a marketable skill.

 

Remember, its a good opportunity if you can clear your initial investment in three years or less. If you start talking about six years or more then its really not worth it.

 

Would this not be a good opportunity?

Cash Inflows:
Year 0: -100,000
Year 1: 0
Year 2: 0
Year 3: 0
Year 4: 1,000,000

Using payback periods to evaluate investments is horrible financial logic.

 

Of course its a good investment. Well it depends acutally. How are you going to survive those three years? If you have enough to get by and are not dependent on that business as your means to survive, then its a good business.

Its just one way to evaluate a business, but by no means should it be the only one.


EDIT: Just noticed that was a Million on the return part. Thought it was still a 100K. Definitely a good investment and if you have any such business plans please feel free to contact me.

 

If you know any investors who appreciate this kind of return, email me. Nice commission involved, as well.

 

Some good stuff in there. One thing I'd like to point out is that if you own a business, like the type you're thinking of, the amount of time you put into it will be enormous. I'm not sure you realize just how labor intensive something like that is. As Trader_J pointed out, many "mom & pop" places have relatives working for below scale.

I have a close friend who was tired of the investment/financial game (Harvard MBA) and thought it would be cool to own and manage a BBQ restaurant, an upscale place in Westlake Hills. He thought he would have the cash flow, based on what the previous owner showed him, to do the books, "glad hand" the customers, and hire a manager to oversee the staff. After pouring a lot of money into the place (the "upscale" part), and offering the very best quality meats, etc., building an outdoor stage for live music, and other things too numerous to mention, the nightmare began to unfold.

It wasn't what the old customers were used to. It was more expensive, because it was better food, and the old customers didn't like that, either, even in Westlake Hills. Members of the staff would call in sick, and he found himself working long hours. And the worst of it was, and this (besides trying to tell you that you will spend almost all your "free time" working to get this successful... a crap shoot), is that he figured out that his location was bad. Not the physical location, but the fact that Westlake wouldn't let him put a sign on the major street he was on that was larger than a shoe box. I'm not kidding. His beautiful place was back behind some buildings on the street, surrounded by giant live oaks, and no one could see it driving by.

Go to a university, borrow the money to do it, if you have to, and get a marketable skill. That's the main thing I agree with Trader_J about. My friend's adventure, which was supposed to be more relaxing than investing money for millionaires, drove him crazy, and cost him a couple of hundred grand before he sold for a fraction of what he had in it.

Now he's back to his old game, with a twist... doing IPO's, which can have a huge payoff at the end, while he draws 6 figures as the CFO, getting them ready to go public. He's doing something really hot right now, and I'm going to see if I can get a little piece of it.

(I guess that was mostly a derail... sorry! )

 

lmfao, it's a wonder why I can't find it in the constitution.

 

it's in the fine print. It's a shame they couldn't of used bigger font when they typed that, and yes the founding fathers typed the constitution.

 

Just learn how to make FRIED RICE/ CHICKEN and open a TIMMY CHAN'S

 

FWIW, I may need some help along these lines.

 

Added to the risk of owning a convenience store or liquor store is the higher likelihood of getting robbed, or shot at by street thugs.