If he's selling you the Master Franchise rights, it's probably because its not profitable!I got a lead from friend to takeover his master franchise rights
thanks replying.. i've read his p&l and saw the numbers. definitely not 10K.. haa.sundaymorningstaple wrote:Have you bother to look at his P&L & Balance Sheets for the past 3 years or so? Looking a traffic doesn't always lead to sales. Depending on the percentage that rental consumes of his turnover will make a big difference.
29% of 10K turnover isn't much.
Thanks for replying.. Actually he didn't say he is selling to me. I sound him out cos he told me he might not be able to manage two countries at one time. He roughly quote 200K. I dont know if its the final.ksl wrote:If he's selling you the Master Franchise rights, it's probably because its not profitable!I got a lead from friend to takeover his master franchise rights
If the franchise hasn't been managed correctly, they are better off dumping the lot for 200k and letting some poor sucker take the fall.
My guess is that other franchisees' if there are any, are not doing well, you maybe held liable. You need to read everything more closely looks very suspicious to me, though I'm ultra careful.
PM me the name and i can do some research for you within minutes.
Though like SMS said, look at the books very carefully and discuss with those holding the franchise units, could be a lack of support for them and now he's wanting out
200k for a 9 yr licence is quite steep indeed. If you are talkin abt female beauty products the market as it is is quite competitive here with very low margins. I can say that quite confidently from the book-keeping services that i provide to my clients in the beauty products supply market. You have also got to factor in how much you might have to pay in order to renew the franchise (normally its done @ a nominal fee) positive cash flow as always is king. Huge paper profits with big receivables = zilch! Ask for his latest management / audited accounts sit & scrutinize diligently. You could also ask for his ACRA profile in order to check if there are any charges listed currently against his co. If he provides you with his audited statements that would be the best coz that should reflect a true & fair view of how the business has been doin recently.Rayofhope wrote:Hi all,
I am new here and would like to seek some advice on business in Singapore.
I got a lead from friend to takeover his master franchise rights of a retail brand dealing in female products in singapore. He is leaving singapore to setup other countries. I have visited his store and thinks his business is brisk.
Do you guys think its a good idea to pay $200K for 9yrs exclusive licence and takeover existing operation with a 29% net profit plus able to subfranchise it?
I am very tempted and my wife love his products.
Pls advice.
Thank you.
taxico wrote:there's a chinese proverb which goes (something like)...
"one would never sell a goose that can lay golden eggs"
which goes against the western adage of "everything has a price..."
but i can only quip "if it's too good to be true..."
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