Team Mass Posted April 29, 2011 Share Posted April 29, 2011 Hi, I've been looking at buying out a competitor with 2 large accounts I'm not sure how to evaluate. They have candy machines and toy machines in two high traffic locations. 1 Mall location (with exclusive). 1 Movie theatre location (Both under contract). Any suggestions or thoughts? I know the owner is asking for two much money for them but I'd like to see if I can get an offer together for them. I was also looking at placing something similiar at a few locations myself and would like to get an estimate on revenue that could be generated from these type of accounts. Ray Link to comment Share on other sites More sharing options...
Profits Posted April 29, 2011 Share Posted April 29, 2011 Business valuations are all over the map. I'd go with a 12 month gross figure as a baseline. Link to comment Share on other sites More sharing options...
havending Posted April 29, 2011 Share Posted April 29, 2011 You have not provided enough info. Sales data? Comm rate? Machine types? I would question the mall being exclusive malls rarely give it to vendors. And what's the end date on it? Link to comment Share on other sites More sharing options...
Team Mass Posted April 29, 2011 Author Share Posted April 29, 2011 You have not provided enough info. Sales data? Comm rate? Machine types? I would question the mall being exclusive malls rarely give it to vendors. And what's the end date on it? 3 year contract for the mall is $800.00 per month flat fee. (Exclusive minus soda/snacks and is auto-renewed). The Theatre is 30% comm rate. I'm going to assume no machines included in purchase I have enough already. (I can add there value later). Link to comment Share on other sites More sharing options...
Team Mass Posted April 29, 2011 Author Share Posted April 29, 2011 PS. I'm more interested in what the estimated revenue would be on these type of accounts. I have an opportunity to get a few more theatres as well (new accounts - They are asking for estimates themselves). Link to comment Share on other sites More sharing options...
Profits Posted April 29, 2011 Share Posted April 29, 2011 would like to get an estimate on revenue that could be generated from these type of accounts. If you're in talks with the owners of these accounts, they will be able to give you the figures. And if you're in talks with the owners, why have you not done this already? This is Step 1 of buying a business. Link to comment Share on other sites More sharing options...
will.vend Posted April 29, 2011 Share Posted April 29, 2011 3 year contract for the mall is $800.00 per month flat fee. (Exclusive minus soda/snacks and is auto-renewed). The Theatre is 30% comm rate. I'm going to assume no machines included in purchase I have enough already. (I can add there value later). yea ray you really havent provided enough info... there are to many variables, but like profits said these figures should be provided by the seller. I do know you will have to sell 3200 gumballs to gross $800.00 a month on the mall location. Link to comment Share on other sites More sharing options...
Team Mass Posted April 30, 2011 Author Share Posted April 30, 2011 yea ray you really havent provided enough info... there are to many variables, but like profits said these figures should be provided by the seller. I do know you will have to sell 3200 gumballs to gross $800.00 a month on the mall location. The $800 dollars would only be 1200 vends of $1.00 toys which is very managable. I have a few convenience stores which do over 400 vends every 3 weeks (I know this because its how frequently I have to service them). I wouldn't just sell gumballs, that would be a huge no no... I'm minaly a toy and capsule vendor. I was hoping to hear from someone with another mall acoount to verfiy the monthly revenue. I have figures from the seller he's providing, but I'd like to here from someone else (a third party estimate on income). I'm also negotiating with a similiar a mall who wants revenue projections for there locations. It's part of the contract arrangement they require. Do any of you have mall accounts? It seems to be a rarity. PS. I'm verifying the machine count included with the purchase (which is close to 200 units), but the only issue I have is what the revenue is like on mall accounts. The owner won't provide anything documenting this account and has already sold a piece of his business last year so the tax returns are useless. Link to comment Share on other sites More sharing options...
havending Posted April 30, 2011 Share Posted April 30, 2011 800.00 a month is a lot even for a mall. And mall are not that great anymore. You would have to do 3 grand just to see profit. You know malls require seperate insurance for machines and your van. One you sign on the line your on the hook for the 600.00. Im a vending rebel and i would pass. Link to comment Share on other sites More sharing options...
antoniocinisi Posted April 30, 2011 Share Posted April 30, 2011 why is he selling such "good" accounts Link to comment Share on other sites More sharing options...
Team Mass Posted April 30, 2011 Author Share Posted April 30, 2011 I got a quick email saying he bought a larger business in Florida and was in the middle of relocating. He just bought a soda and snack location route there. I was emailing back and forth yesterday and he started giving me the real list of accounts and it was actually 3 malls he operated in so now I need to get even more data. Not sure if it was $800.00 per location (mall). His machine counts though are strong. He claims he has 200+ machines in the 3 mall locations (all 5 years old or less) which he'll include. I just have no idea how to predict the revenues from malls he has running right now. I'm going to be looking into it more. I'm just hoping that someone else has a mall account that they can share there monthly revenue from so I can get an estimate. The selling price is low which is what is scaring me off. It could be because there is no revenue from the malls or a loss of money from them. The other possibility is that he is that desperate to get out. I believe he is already in the process of moving to Florida where his new business is located. Link to comment Share on other sites More sharing options...
caserri Posted April 30, 2011 Share Posted April 30, 2011 TM, Member Blueplate here on the forum has experience in mall accounts. Try searching his posts or contact him via PM and request his comment in this thread. Link to comment Share on other sites More sharing options...
Profits Posted May 1, 2011 Share Posted May 1, 2011 There's something questionable about this thread: You say you've talked to the owner. You say you want to figure out how to approximate the value the business. You say the owner wants a low figure. But one super critical detail is required before determining how much a business is worth. The business owner has to TELL you how much it's making. Why are you beating around the bush, avoiding the detail about why the owner isn't telling you? I think I've asked you this 3 times in this thread. And why are you asking us? Do you like playing Russian Roulette with business acquisitions? Link to comment Share on other sites More sharing options...
Team Mass Posted May 3, 2011 Author Share Posted May 3, 2011 There's something questionable about this thread: You say you've talked to the owner. You say you want to figure out how to approximate the value the business. You say the owner wants a low figure. But one super critical detail is required before determining how much a business is worth. The business owner has to TELL you how much it's making. Why are you beating around the bush, avoiding the detail about why the owner isn't telling you? I think I've asked you this 3 times in this thread. And why are you asking us? Do you like playing Russian Roulette with business acquisitions? I'm still trying to work with the seller and get more information. Just because they don't give it up front doesn't mean he won't... I also would prefer not to share all my information here. I know atleast 8 vendors here who are competitors and don't wish to share everything up front. @ Profit - What I was trying to do was get information from someone who has a mall account and findout their revenue. Nothing personal but you just either don't have a mall account or can't understand that I'm trying to verify. I already have his numbers now, I just can't verify them. I'd really being playing Russian Roulette with my business acquisitions if I just took his word for it! No offense but if your not going to try and help just ignore my threads. PS. For anyone that was interested he says he's making 12K profit and wants 15K for the route with 205 placed units. Some parts and extras. I figure there is about 7-8K worth of equipment ($35 per unit each). He is also saying he'll leave the machines 1/2 filled which should mean @$17*205= 3.5K estimated in stock. @ havending, Thank you for your information. I already have the insurance on my machines, and vehicle in place (I had to get this for another large account). I'm also going to need to check the town licensing because some towns charge a sticker fee in MA now for gumballs and toys. They don't tell you that upfront when your getting into this industry. You were right on by bringing the insurance up. If I had just a few accounts and hadn't already been caught off guard by this before it would have gotten me. If anyone can estimate a mall account or revenue from a movie theatre please let me know. I've been trying to reach out too those who have any revenue numbers for these type of accounts. I'm probably going to pass on this if I can't get a verification on the mall acounts because I'm not a risk taker. I want to make sure I'm not overpaying. I'd rather pass on the whole deal than overpay for just a few accounts I can't verify (similar) income from. Link to comment Share on other sites More sharing options...
Profits Posted May 3, 2011 Share Posted May 3, 2011 PS. For anyone that was interested he says he's making 12K profit and wants 15K for the route with 205 placed units. Some parts and extras. I figure there is about 7-8K worth of equipment ($35 per unit each). He is also saying he'll leave the machines 1/2 filled which should mean @$17*205= 3.5K estimated in stock. This was the information we were looking for. The price sounds appropriate. I would do it. Link to comment Share on other sites More sharing options...
Team Mass Posted May 3, 2011 Author Share Posted May 3, 2011 @ Profit, sorry for my comment but it seems like (on all my threads) everytime I post something you had something negative to say. I see you changed your comment and I apologize if I offended you. PS. I'm probably going to negotiate but its the mall issue that is huge to me. If he has 3 malls @ 800 each per month this could be a really bad deal. I just don't trust this guy is telling the whole truth and won't rush into it. I'll probably push him to the last minute when he wants to move out completely and make him a lowball offer. Link to comment Share on other sites More sharing options...
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