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Thread: Got an offer today. Need some advice

  1. #1

    Got an offer today. Need some advice

    Need some help guys. Everyone chime in and tell me what you think.
    The first part of this post was placed on another forum earlier this week.


    I am currently working at a local exotic lumber/woodworking store part time 30 hrs per week. I enjoy it and I get a good discount .... However this limits my time in my shop quite a bit. I also find myself putting in very long hrs trying to keep up on things. My averaged day is opening the store at 7:30 and closing my shop around midnight.
    Another local store across town has offerd for me to move my woodworking business to their location. The deal would be for me to set up shop in the back of their store for a minimal rent. The space is about 1600 Sqft. They would also give me about 28hrs per week part time in the store. When things are slow they have no problem with me being in the back in my shop. The space is fully equipped and I would only have to move a few tools over. They also want to sell the store down the road and would like me to consider buying it. We talked about this about a year ago but I was unable to do it. They mentioned they would make it relatively easy for me to buy if I wanted it. Their son started the business and had to relocate with his wife. The owners were left with a business they really did not want so they are motivated to get out of it.

    Part II The update

    Met with the store owners today. Was a good meeting. We discussed buying the shop in the future but the meeting concetrated on me moving my woodworking business into their shop space.
    Here is the deal....
    They want me to move my business down to their store. The shop is located in the heart of the shopping district .5 miles from the largest mall in town. We are directly behind a SAMS and Walmart and a block away from Lowes. The back area is about 3300 Sqft which I would have half. Not a lot of space but for a one man operation not too bad. I have 24/7 access to the shop. The shop is already equipped but I would want to move some of my stuff (my slider) in eventually. My rent would be 500.00 per month and that includes utilities. All business I bring in is mine. Any business they bring in they get a small percentage. The owners own a small local advertising paper they distribute througout the nicer neigborhoods in town. They would provide me with free advertising in their paper. They want me to work in the store Tuesday, Wed, and Thurs (their slowest days of the week) When there are no customers I work in my shop during that time. I only have to monitor the store and wait on the occasional customer. This means I am getting paid to work in my shop. Sounds like a good deal.
    I know the guy that is in there now and he loves it. He gets a lot of small repair jobs ($60.00 mimimum charge) most average around $100-$150. The owners are friends with a designer that has provided him with about $5K worth of work in the past few months. Only reason he is leaving is his wife got a great job and he has to relocate out of town.
    I can advertise in the store. Meet with my clients in the store and conduct business all while working in the store. They also made me an offer to teach classes in the evenings if I want to and I take 100% of any tuition I charge for the class. I am doing this now at the other store I work at but only getting paid an hourly wage.
    I have known the owners of this store for a couple of years now. They are good decent people. Straight shooters and they just want to keep the place running. To them it is a win/win situation. They get an employee they really can not afford to pay and I get a shop and business location I could never afford to pay. Everything I buy (supplies, tools, etc) is at cost plus 10%. I will not be running the store just working in it. What do you think

    Greg

  2. #2
    Join Date
    Dec 2006
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    Pennsylvania
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    Man, sounds like a great situation. I don't really see any downside. Is there something you're not telling us?

  3. #3
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    It does sound great. Not only are you going to be able to increase your shop time, but you can a place to find new custumers. Plus the free advertisment. Go for it, it looks like you will both be happy with the deal.

  4. #4
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    It sounds like a very good offer..................what is the catch?

    You know what they say, "If it sounds too good to be true, it most likely is"..........just being overly cautious.

    A few questions.

    What is the worst case scenario you can see happening in say six months or a year from now?

    For example, lets say they decide to close up the store earlier than you thought and want to sell it NOW....... and you are not in a position to buy........................ would you just move back to your home?

    It really does sound good, the way you are describing it, but I have to ask, do you REALLY want to own a retail shop?

    Retail can SUCK HARD, I know, I'm in retail.

    If you buy the store, would your shop time take a serious hit, and could you end up doing a job you don't want to be doing (retail sales) instead of building stuff?

    Just asking.

    If it all works out, you must be living right!
    The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.
    William Arthur Ward

  5. #5
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    I think you will be kicking yourself in the pants if you let this get away. Sounds like a really sweet deal.

  6. #6
    Stu,
    All good questions.
    They have a lease until Sept 2008. He has already told me his sale price and said that would not go up if I wanted it.
    No I do not really want to be in retail but ownership of this shop could really be good for my woodworking business also. Especially if I want to grow or expand with employees.

    Worst case scenario is I move back to my shop and keep on plugging along.

    These are really decent folks. They have bent over backwards on pricing equipment for me. They give all the guys at the base a huge discount. Very mom and pop. They have money and the store was purchased for their son who had to leave. They are not pressed to sell but would like to.

    This does sound too good to be true but I can not find any flaws. Only thing I would have to do is get insurance

    Greg

  7. #7
    Join Date
    Nov 2006
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    Tokiwadai, Japan
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    2,882
    Hmmmm...

    Stu brings up some good points.

    Some other questions/comments.

    What kind of store, specifically, is this?

    Who, besides you, will be in the store on Tue, Wed, Thur? If it's only you...I would not plan on doing anything in your "shop" that would require a lot of concentration. Trying to do finish work, precision cuts, glueing, allignment and get interupted by customers, who have priority on those days, could cost you dearly.

    What if you are in the middle of a serious discussion with one of "your" customers..when a "store" customer comes in. The store customer has priority, right? If I were "your" customer...I might wonder about your commitment to me and my project if you have to keep running off to attend to "store business".

    I would be hesitant to get into a situation where mixing your business, and your other job could cause you to not do well at either...and loose one or the other.

    I just see a situation where you become a solution to the owners problem, or plan, but not necessarily a "win-win" situation if you think you are going to be able to really build up your own business at the same time, at least those 3 days.

    I don't mean to be negative, but as Stu pointed out..."too good..

    Another Greg
    Last edited by Greg Cook; 01-17-2007 at 06:41 PM.

  8. #8
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    Quote Originally Posted by Gregory Hairston View Post
    They have a lease until Sept 2008. He has already told me his sale price and said that would not go up if I wanted it. Greg
    Are you saying they are leasing the store...they don't own it? If they are leasing...what do you do in Sept 2008? Commit to lease the store location, do your own thing...? Lease the spot and buy the current business and merge yours? What if you can't lease the spot? Rent goes up more than you can afford at the time?

  9. #9
    Greg,
    All good points. Thank you for bringing them up. This is why I love this forum. Yes they are leasing the store. Worst case scenario is I move to another location or back home. Hopefully I will have built up enough business and reputation to follow me.

    The store is a woodworking store similar to Woodcraft. Store customers are the priority. That will require me to schedule my work. If I need to do finishing work on a project I can come in early and do it prior to opening up or stay late. My customers get treated the same way the store customers get treated. First come first served. The guy that is in there now says he usually does not see a store customer until around 10AM or later. Then they just come in throughout the day. Mid week tue/wed/thu is very slow. He averages about 6 hrs in the shop. Owner is fine with that.

    Right now I see the cons you bring up are a matter of concern but not sure they outweigh the pros yet. Look at it this way. Any work I can do while monitoring the store is bonus. Right now as I sit here and type I am not getting paid a cent. In the store I will be making money. Same goes to making Jigs, shop cabinets etc. If I am not working for a client I am not getting paid. In the store I can do all this while paying my shop rent.

    Keep em comming....

    Greg
    Last edited by Gregory Hairston; 01-17-2007 at 07:22 PM.

  10. #10
    Join Date
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    Quote Originally Posted by Gregory Hairston View Post

    "The store is a woodworking store similar to Woodcraft. Store customers are the priority."

    "My customers get treated the same way the store customers get treated. First come first served."

    Greg
    Uh...I'm a bit confused.

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