Buying a sporting goods business

**zacsdad** · 01-31-2010 12:16 PM

Actually 5 companies make up this one: a screen printing division, an embriodery division, a team sales division, a trophy division, and a corporate or asi division.

Been talking with the current owners for about 4 months now and think we are going to take the plunge, actually buying 1/2 now and 1/2 in 3 years, current owners are going to stay on for 3 years and help us learn the ropes. They are 62 and 61 and getting to the point that they are ready to retire. We are taking a huge loan out to do this but if we (my brother, and my dad) dont we will kick ourselves in 3 years.

Anything you can suggest that we NEED to do BEFORE we take the plunge?

Thanks for any insight!!

**bella2009111** · 01-31-2010 07:29 PM

I don't think so. Everytime you should take care .

**ryanfromrethink** · 01-31-2010 08:56 PM

How soon are you expecting to fully ROI? It's great they're willing to stay on.

**zacsdad** · 02-01-2010 11:10 AM

Originally Posted by ryanfromrethink

How soon are you expecting to fully ROI? It's great they're willing to stay on.

ryan, best case scenario 3 years worst case 6 years

**rpermana** · 02-03-2010 12:20 AM

Are you interested to get APACS badminton rackets.. I have a good contact in Singapore

**HENARRY JAYA** · 02-07-2010 11:06 PM

A business plan is apparently required if you are going to ask for a loan to start your business, buy the stock. It outlines how your company is set up, what the actual market is, and how things will be done (I believe). It is your road map. In order to do one, you have to know how a business runs successfully.

I am not a sport playing person. My husband enjoys things about hunting. So I look at sporting goods catalogs and visit three different chain stores in the area, buying clothing, rain wear, jackets, jeans, etc.

**zacsdad** · 02-10-2010 11:32 PM

business plan written, and a 46 question booklet. WOW had no idea that this would be this complicated but I guess the bank is covering their tracks. Not done yet but less than a week and we should be rolling!

**Dainan** · 02-28-2010 06:03 AM

This is an interesting thread, brought up some things I had not previously though about

**idealcost** · 03-01-2010 08:21 AM

I may be a little late here, but what exactly is the plan of attack to compete with online companies who can probably beat you up on price? I see buying a retail business is pretty risky in these times.

**stellamary** · 03-04-2010 03:17 AM

The business always risk if you think about the risk...Your lateral decision making will create a good result.I am interested in home outsourcing jobs also managing the process of the valuable decision making...so keep sharing.

**phuongtim39** · 03-25-2010 08:23 PM

Originally Posted by rpermana

Are you interested to get APACS badminton rackets.. I have a good contact in Singapore

I accept with information:It is your road map. In order to do one, you have to know how a business runs successfully.
___________________
Argentina tours

**mcfarldr1** · 03-25-2010 10:18 PM

I would concentrate on marketing strongly in the youth sports in your area. High percent of sales are going to come from that area and you want to capitalize on any opportunities you have.

A 3-6 year ROI is very good. Hard work will pay off!

**ZingerIntl** · 03-29-2010 02:16 PM

zacsdad, I apologize on behalf of entrepreneurs everywhere that all you get is people thinking about how your question can benefit them.

If you want some real advise about acquisitions, any questions you can send them to me at wzinger@zingerintl.com (thats my acquisitions company) I think I know a way for you to get the loan with out all the hassle. Its a rare case that long standing, self employed, business owners stay on for 3 years (which happens to be longer than most banks require you to be profitable, before you can get a loan.) What I mean is, you have a way of getting a loan now, on what your credit and income would be in 3 years. Same result, different way of getting there.

Just a rule of thumb or 2 tho

Assets (furniture fixtures and equipment) need to be valued and bought, under replacement cost. You wouldn't pay full 2008 price for a house right now would you? Dont pay full for FF&E either.

2009 NET income times by 1.5 is the business price total (MAX... with the economic instability forecast of 2011-2013, I would not want to pay top dollar) then add on the total for the assets (Tip, on the PnL you need to look for all the profit that will be added back into the NET. Like owner draws, travel expenses, bonuses)

Sellers need to be willing to carry a note. This is a credit crunch for most small businesses. Especially if they will see you work the biz for 3 years, they should feel safe taking payments from you after that.

When you buy a business and the sellers are going to stay for an extended period of time, you can feel safe that they are giving you legitamate books. But, if the market takes a dive, and you dont want the other 50% in 3 years, are you protected.

All in all tho, buying a business is a waay better idea then starting one, for young entrepreneurs. It allows you to see the dream in operation before spending time and money on it. Good Luck.