I am planning on buying a 12 year old store in my neighbourhood. The seller either wants to sell it at 72000 and I get a sub lease in which I pay him $3200 for the next 5 years of the lease or pay the seller 95000 and he gives me a new lease ( landlord approved) for 5 years and rent $1600 ( including RE tax). Now if I pay him 95K in advance I do get the benefit of a low rent for the next 5 years but I will only have about 40k left to run the store. I might have to do a little renovation too. I dont know what to do, will I have sufficient cash left to run the business till it catches up. the current owner is not willing to show me his tax papers saying they are too personal. I have no way of knowing how much he makes. I like the location being close to my home and right outside the subway. I think if I make some improvements I might be able to run the store a little better. Please advice. by the way I have no experience running a c store.
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Convenience Store Decisions Community » Ask the Experts
sub lease or a new lease
(2 posts)-
Posted 1 month ago #
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I could never recommend that you purchase a store where the seller does not provide you financials. They do not have to give their personal tax return, but at a very min. they should provide a store P&L.
When I began in this industry 30 years ago we used a simple paper based P&L system. Today most independent retailers use something like QuickBooks which can create a store level P&L. Armed with information you can then make a better decision regarding the two alternatives should you elect to move forward.
Posted 1 month ago #
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