deal or a lifetime or...

[Ccarsdallastx]

is this the opportunity of a lifetime or a nightmare?

 

A little backround on my shop, we are a small operation currently leasing a 2400sqft two bay shop with two techs (father and brother) and im in the office running the business as well as turning wrenches.

 

For the first few years the business grew aggresively but in the past two 2 years it seems to have hit a rough spot we are barely making enough to cover the bills and everyones salary. For the longest i have been loosing sleep trying to figure out how to make this place profitable again and then some.

 

Every time brain storm it i come to the same conclusion LOCATION!

We find ourselves hidden away in a business park surrounded by a few different companies (that we do work for) but no real exposure to a main road.

 

Today i found myself smiling knowing that maybe enduring all these hard times would come with a reward some day, and it looks to be like it has and it was in front of my face this whole time..

 

it is a former gas station that has been shut down for a few years now and in the past yr had all pumps and underground fuel storage tanks removed,

with 1176 sq.ft. three bay work space plus additional covered work area where pumps used to be in addition it also has a 500sq ft waiting area. it is situated on a corner lot of two major intersections and just a block from a major hwy, so i start researching car count and it looks to be at least 40,000 cars drive by it daily!!!

 

So my blood gets pumping being the entrepreneur that i am i start to see the immense potential of this location/"service center" im thinking State Inspection station, tire services, brake service and just all the easy stuff that can draw in customers.

 

But then comes the realization that something like this just won't be handed to me it'll def. come with a huge price tag, so i speak to my current broker tell them i am incredibly interested in this place and need to know what it will cost to get me in there!

Mind you there were no For Sale/For Lease signage so i was semi discouraged at this point.

 

So i get a call back from my broker......turns out he's very familiar with the owner of the property and has informed him he needs to get north of $350,000.00 for it.

As i try to let this sink in im overcome with both excitement and surprise as i was fully expecting a property like this to go for $1.5million easily

 

so as i get down from this high i wanted to get everyones thoughts on this and think logically is this a good move?!?

i know what the potential is and i can get all the business plan in order and know what we need to do to be able to make a profit.

that being said one of the things i would need to do would be get a loan. which i am not big on(thanks dave ramsey). but i have no where near $300k in the bank.

 

My broker informed me that he knows a few local small bank owners that work hand in hang with small business that are very friendly when it comes to handing out these types of loans.

 

so is this the opportunity of a lifetime or a nightmare?

 

TIA

 

-Israel

[xrac]

What is near this intersection? Are there retail businesses, offices, apartments? Is there a stoplight at the intersection? Did the now closed gas station offer automotive repairs? How long has it been closed? Why did it close?

[andresauto]

Property taxes? Does it pass environmental inspections and certified clean? Would a bank mortgage this property or is there something else wrong? Is it a desirable neighborhood? What is the median income of the neighborhood?

Or it may actually be a great deal. Due diligence comes to mind. I wouldn't jump on this nor let this opportunity pass without doing my due diligence.

[cdhowell]

While I believe location can add to a business, I do not think it is the reason you are struggling now from a once thriving business. My place is actually in a small strip mall with mini storage behind it. It looks more like an H&R block than an accessory and auto repair shop. If you do not resolve your declining business, location is not the real solution.

[Handson]

I agree with cdhowell. My shop is very hard to find. Something most of my customers comment on during their first visit. Yet I continue to remove oil change stickers from shops on the "main strip" and replace them with mine. Before you try to convince a bank you can make it on that intersection why not try convincing yourself you can make it any where.

[phynny]

A lot of shops start seeing a decline after the first couple of years because they just stop advertising. With a shop on a main strip you can skimp on the advertising because you will get all of the "walk in" traffic. If it seems like a great deal I would lock it up by putting in an offer and just make it contigent upon x, y and z so you are covered if you find out it can't support a shop, has back taxes or whatever else you have planned for it.

[MINI4U]

Here in our state environmental inspections are required just to refinance! If you get serious about the property make sure they have an inspection done to make sure you don't get into anything ugly. Even though they removed the pumps there may be issues you need to know about.