Buying a Frame Shop?

[John Hagan]

I am trying to compare buying a second shop vs opening in a new location. Has anyone in Northeast/New England done so recently. If anyone has bought I'm interested in prices people have paid and for what volume of sales & COG in $, NET, & Owner's take from second local. (I know that's personal, but it will help me better evaluate buying such a biz.) I'd appreciate your experiences!

 

[JRB]

Stick with one store. Running two stores and the accompanying problems versus the returns to you make it rarely worth the trouble. If on the other hand you want to grow your business, you may want to consider moving to a larger, better location rather than running two stores. I had two stores 25 years ago for several years, I made money, but not enough to justify the extra hours and traveling back & forth all the time.

John

 

[tnframer408]

We've been kicking this around for about one year now. We have our current location which is about 2,000 sq ft. I want to open a "satellite" of about 1,000 sq. ft. about 5 miles away where the ReALLY rich people are--500,000+ homes on the lake what Decor calls the McMansions. the second location would show art only with frames and mats samples , but with all construction going on in the main store.

We'd be linked via computer to reduce travel time between stores, and the link would be on dedicated lines.

I agree the travel between stores would be a pain, so I'd also hire fulltimer to run the second store with existing staff in first store.

I'll be interstred to hear folks' thoughts on this venture. Not doing it yet, but am itchin' to try it.

Bottom line: main store where all work gets done, satellite shows our work, has design capabilites and linked via computer.

What am I missing here? (besides, of course, a huge financial outlay?

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Michael LeCompte CPF
The Great Frame Up

 

[TRACY ART & FRAME]

I currently have 2 retail locations and have to agree with John if that is your end goal.

If you intend to build your framing empire

its hard to get to 5 with out passing through 2,3 & 4.

As to price thats a tough one, check there books if the store is not profitable then its not worth much more than 25 cents on the wholesale dollar if that (remember your buying what they couldn't sell) plus used equipment.

If the store is profitable I could see as high as 5 times last years profits.

Its often harder to save a sinking ship than it is to build a new one next door.


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Diver Dave

 

[maur]

Ionce ran two shops and 3 years later decided to move both shops into one larger shop. The bottom line was more profit because we had one set of expenditures. More bargaining power too with the landlord. Also think about buying a place with extra space to possibly rent to someone. My shop now has alot of square footage with extra space that a rent to an artist.

 

[Bob Carter]

You have several reasons not to open another store(s). Their advice is right for them. My advice is that you might be better served to determine if you have the ability(finacially and managerially) to expand. If you do, you should contact some of those that have done the same successfully, but do it off-forum. You might get a fresh perspective from some of those willingly to help you reach your goals. Some positive help might be refreshing after this gloom.

[This message has been edited by Bob Carter (edited January 04, 2002).]

 

[John Hagan]

Thanks guys! I unfortuatly left some important info out - I run the biz with the family (6 of us) So there is more than one TRUSTING manager. So the plan is to grow with an agressive marketing plan focusing on corporate contracts along with locating in a high income district w/ little competition for retail business/image) the cool part is even though the locations are 10 miles apart they serve completely diferent markets. Having two shops will help by pushing workloads to each other when the big contracts come in...By expanding in one location will never draw those from the new location. Those w/ the two + shop experience...keeping our model at 30-40% retailandresidential business does a second local still make sence?