Lauren (Caller)

My husband and I are considering buying an automotive shop in the small town we live.

He is currently the foreman at the shop, and our jobs basically would be to both have our full-time jobs be running the shop, and I do administrative and accounting, so I would be doing that side of it.

And we're just wondering if we should really dig into this and keep looking into options and moving forward.

They want $150,000 for the business, but doesn't include a building or anything.

That's just the employees and a lot of the tools.

So the lease right now is $2,600 a month.

And the current owner's lease is up in about a year, so we'd have to get something solid, you know, to see what our lease would be beyond that year.

So that's one thing I really want to dig into the accounting if we get more serious about it.

His kind of loosey-goosey income before he gets paid is $250,000 a year.

Yes, and we definitely, if that $150K is more than three years' worth of profit, that's definitely not what it's worth, and we definitely will not pay it.

So we don't have 150K laying around.

He is willing to do payments, kind of like Dave recommends the profit out of the business.

For about half of it, we would try to come up with the other half.

We have about...

eight thousand extra right now and we have some like uh lawsuit settlements that would hopefully be coming in before then and we have a couple toys we can sell too my guess is it's not worth 150 though so that's the good news i don't think it's going to be worth 150 once you dig in doesn't sound like to me okay um maybe it is okay i don't know uh but i i doubt it why are they selling the business

So the owner is retirement age, and he just wants to retire.

Yeah, definitely.

You've got to pay yourselves, too.

Yeah, we need to pay ourselves and we need to have some cash in there so we don't end up not being in payroll.

Is that an evaluation that Dave uses?