Brand New VS Used Business

[adonis.chan08]

Hello! My name is Adonis and I am 24!!
I am looking to open a small busniess, and I was wondering would it be better to take over an a existing business or would it be better to start fresh.
1. would be a liquor store
2. would be a dry cleaner

Any help would be great....

[rogercbryan]

Both have barriers to entry such as retail space leasing and capital requirements for equipment or licensing. Do you know of anyone selling an establishment in your area? Do you have a business plan written up for each of these possibilities?

[BusinessAdviser]

I'd have to look at the costs and benefits associated with each to make such a decision. It will depend on the specifics of the business opportunities.

[veikoh]

I would get a established business in that sector if the business is valued fairly e.q. around 3 years proffits. especially if you do not have much experiences and cash.
first you will get financeers to finance the deal, incuding owner financing and secondly management transfer period.

[paul2145r]

I agree with the previous posts- you will need a decent amount of startup capital for either business, either existing or new. Do you have experience running this type of business? Talk to some business owners in your area, and get an "interview" about day-to-day life as a ___________ owner. See what they say, and take it from there!

[rogercbryan]

Whether you go for an existing company or if you plan to start a new one you will need an ample supply of capital. Make sure you have at least six months of working capital before you try any retail service type venture. Most small businesses fail because they launch with out enough capital reserves to keep them going for the first year.

[adonis.chan08]

Thank You!! For everyones response I will take everyones response into consideration.
Also to reply to everyones reponse I also have some Friends and family in that business. I will make sure interview each and everyones specific fields and keep everyone upated.

[IwannaDB9]

depends on the market you want to target, if its in the right area a luxury dry cleaning store maybe the right idea as you can sell it to people who don't want to do their washing and you can charge more as well as perhaps offering a home cleaning service whereby you or your employees go to peoples houses and do their washing for them

also, it would be easier for you to declare less income since it is not stock you're selling...declaring less means less tax to pay but I wouldn't advise that at all

[pboychuk]

Hmm, one thing I would consider is how easy it would be to startup both businesses, so if you buy an existing business, you are probably going to have to pay for not only the tangible assests but the time invested into the company by the owner, However, It cant be hard to find liquor suppliers and a bunch of washing machines.

[VDA 2006 Inc]

Liquor stores carry high $$ inventory, many at least in the 75k+ range and that would not be included in the asking price. However, if you start your own, you'll still need to stock it.

I would recommend looking into buying a established business, find one that has been pre-approved by the SBA and you will only need about 25-30% of the asking price as a down payment. This would leave you with more capital needed to run the business in the first few months until you get a hand on things.

[JLeezer]

Hmm, one thing I would consider is how easy it would be to startup both businesses, so if you buy an existing business, you are probably going to have to pay for not only the tangible assests but the time invested into the company by the owner, However, It cant be hard to find liquor suppliers and a bunch of washing machines.

You're definitely right...neither of those things are in short supply. Liquor/wine distributors are happy to set up new clients. Washing machines can be found just about anywhere. HOWEVER, a liquor license can be just about impossible to acquire in some places, and in others, so expensive that it prevents anyone without several $100k to purchase them. And the washing machines won't do too much good for a dry cleaning business, unless he's really saying he'd like to start a coin-laundry facility...which is a totally different beast.