Investor · Southern California · Member since 2011 · 155 posts · 13 votes
Hi, BPers, my wife is interested in investing in a beauty/spa store in Southern California. We are quite new to investing in business. So any idea on where to look for such deals, and what we should pay special attention to? Any advice will be greatly appreciated.
Sorry if this comes off rude but my first question is WHY would you want to invest in something new in a market you know nothing about? I'm in Riverside CA and I see those business' on every corner so maybe they do have a positive cash flow. Maybe you know something I don't, please enlighten me if so. I'm always looking for new streams of income. Again, my question wasn't to be rude. Thomas
Got a flyer in the mail yesterday, "$6 for ANY Haircut."
What's a crappy haircut take? 20 minutes? $18/hour minus overhead. I'm interested just out of curiosity what kind of numbers these shops return as well.
Haha, not rude at all. She has a couple of close female friends running spa stores in Northern California (silicon valley). They have pretty royal and high-income clients and good cash flow (according to her friends). And that's something my wife has always been enthusiastic about, so I get to let her at least try it.
I googled a few, and they cost anywhere from $30k to $500k. I don't know how to appraise these businesses, and what would be a fair deal and what would be a great deal.
Yes thats a tough one, I guess if you have disposable income its always worth a shot if the numbers make sense. I couldn't imagine spending anywhere near 500k for a business like that though. I am sure you can start your own or buy someone out for well under 100k but then you may want to ask yourself what is there reason for selling. Do her friends run them or own them? I would definitely ask to see hard numbers before jumping into a business like that. Just my "2"cents!
@Thomas Glasbrenner Thanks for the reply. What kinds of hard numbers do you mean? I know I need to get the financial statements, pay roll record, tax returns, inventory list from the seller. Anything else I should get from the seller? Any questions I should ask her?