Business opportunity, need some advice

notlaw · 01-07-2009, 02:45 PM

Hey everyone!

I apologize its been awhile since i have posted, got caught up in universities and other adventures...

I've been doing consulting for a girl who recently opened a massage clinic. Im basically creating her entire business plan, as right now she simply performs the service when clients come in. No marketing, accounting, etc is done at the present time. There isn't even a brand. But her sales are quickly increasing month over month, and she has strong retention.

Anyway, up until now i've been doing the work for free since her business is only 6 months old, and I want to show her that my consulting will help before im compensated for anything.

Im at the point now where I want to start thinking about how I can position myself to benefit the most out of this, but also give her the most value out of our agreement. She wanted to know if I was interested in a piece of the revenue per session, or an hourly rate, etc.

Would there be value in proposing a partnership with her? What are your thoughts? Or should I stick to the piece of the revenue portion...since it doesn't involve liability to expenses, investments, etc. I just don't want the business to get on its feet then get the "adios" treatment

Nordstrom · 01-07-2009, 09:04 PM

If you are the one to take care of management, accounting etc, whereas she does the labour - I believe it is a very good idea for you to ask for an equity in it. To get as much equity out of it as possible, try to show her for a couple of weeks before, how much you are ready to work and try to achieve something quite big before you ask her for the per cent. This way you will be guaranteed a bigger equity.

She is a girl and most probably base her thoughts more on emotions than you, so try and play that for your advantage.

Happy her - Money you.

PS. Sorry for the extremely bad sentence.(3 AM)

notlaw · 01-07-2009, 11:21 PM

Quote:

Originally Posted by Nordstrom

If you are the one to take care of management, accounting etc, whereas she does the labour - I believe it is a very good idea for you to ask for an equity in it. To get as much equity out of it as possible, try to show her for a couple of weeks before, how much you are ready to work and try to achieve something quite big before you ask her for the per cent. This way you will be guaranteed a bigger equity.

She is a girl and most probably base her thoughts more on emotions than you, so try and play that for your advantage.

Happy her - Money you.

PS. Sorry for the extremely bad sentence.(3 AM)

thanks for the good response...what about % of equity?? any suggestions.

The Lost Flier · 01-08-2009, 03:33 AM

I wouldn't worry about an equity stake. She does not have a business she can sell. She is the business.

You need a simple written contract that says you get $5-$10 for every massage she does.

Then what you do is go out and find other clients to do the same thing for.

chrisro · 10-28-2009, 11:34 AM

Quote:

Originally Posted by The Lost Flier

I wouldn't worry about an equity stake. She does not have a business she can sell. She is the business.

You need a simple written contract that says you get $5-$10 for every massage she does.

Then what you do is go out and find other clients to do the same thing for.

Absolutely I agree with this statement. You do not want to get intangled in ownership issues and expose yourself to anything that happens with the business when she is The business. If she goes then you are on the hook for all the other liabilities as well. Keep it simple drive business to her get a per deal contract and go help someone else. She only has the capacity to do so many massages in a day. Look at your limits.

Scar Tissue · 11-02-2009, 08:45 AM

I did some promotion plan for similar business before, trial membership coupon works, especially christmas is coming.... maybe you can have 5-10% commission of that.

Maxewhite · 11-03-2009, 05:03 AM

You should be careful when it comes to these kinds of arrangements and I would agree with the basic contract or the deal to prevent you from getting all her business liabilities. This can be for a short term basis though as a practice, it can be one of your stepping stones to help other people.

corporate111 · 11-10-2009, 12:21 AM

A lot of community colleges have small business centers with resources that can help you. Small towns will take risks to get business, too. Ten years ago, I got $100,000 and a building to bring a business to a small town. If it's a good idea, you've got to get it out there.