Lawn Care Business Forum Lawn Care Business Book Lawn Care Business Blog Lawn Care Software
Home Forum Contract & Flyer Templates Blog Software Videos Podcast Calculators / Estimators Store Mower Review Design It Yourself Lawn Business School

Go Back   GopherHaul Landscaping & Lawn Care Business Marketing Forum > Business > Franchise Building, Entrepreneurs, Business Leaders, & Innovators Discussions

Franchise Building, Entrepreneurs, Business Leaders, & Innovators Discussions Are you interested in starting your own lawn care franchise or are you interested in buying into one? Let's talk about different franchise opportunities and how to build your own franchise. Also we discuss different entrepreneurs who inspire us!

Lost money on a sandwich franchise


Franchise Building, Entrepreneurs, Business Leaders, & Innovators Discussions

Are you interested in starting your own lawn care franchise or are you interested in buying into one? Let's talk about different franchise opportunities and how to build your own franchise. Also we discuss different entrepreneurs who inspire us!
Reply
 
Thread Tools Search this Thread
  #1  
Old 06-09-2009, 11:56 PM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 37,277
Rep Power: 10
Steve has disabled reputation
Default Lost money on a sandwich franchise

Today I was talking with an entrepreneur who lost quite a bit of money on a sandwich franchise.

He had gotten some money from a death in the family and decided he would buy this already up and running franchise from another business owner.

There were two big problems. The new owner had a fulltime job elsewhere and second, the previous owner cooked the books and showed the business to be making money when it was in fact losing money.

The store is now closed.

We were having this discussion about how you can just never really verify such things. My view was I am sure there is a way to potentially put some money aside in a fund that would only be transfered to the original owner if certain financial conditions are met, however barring that, there is no way to certify a business made $x amount of dollars last year.

Hmmmm maybe you could get the businesses accountant to sigh off that the business did indeed make what ever they claim to have made in some kind of audit? And then the accountant would be held liable if this were false?

What's your thoughts on something like this?

Any thoughts on how to confirm such income before you buy a already running business or franchise?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote

Stop guess-timating. Learn how to estimate and make money! $$$
Mow Time Estimator Lawn Care Price Estimator Mulch and Topsoil Calculator Snow Plow Estimate Calculator


  #2  
Old 06-10-2009, 12:05 AM
swstout's Avatar
swstout swstout is offline
Steve
 
Join Date: Jan 2009
Location: Canastota, NY
Age: 66
Posts: 1,082
Rep Power: 8
swstout is on a distinguished road
Default Check

Lawn care business tipsLawn Care Business Book
Quote:
Originally Posted by Steve View Post
Today I was talking with an entrepreneur who lost quite a bit of money on a sandwich franchise.

He had gotten some money from a death in the family and decided he would buy this already up and running franchise from another business owner.

There were two big problems. The new owner had a fulltime job elsewhere and second, the previous owner cooked the books and showed the business to be making money when it was in fact losing money.

The store is now closed.

We were having this discussion about how you can just never really verify such things. My view was I am sure there is a way to potentially put some money aside in a fund that would only be transfered to the original owner if certain financial conditions are met, however barring that, there is no way to certify a business made $x amount of dollars last year.

Hmmmm maybe you could get the businesses accountant to sigh off that the business did indeed make what ever they claim to have made in some kind of audit? And then the accountant would be held liable if this were false?

What's your thoughts on something like this?

Any thoughts on how to confirm such income before you buy a already running business or franchise?
The first thing I would do before investing is to check his rateing with his suppliers. How he paid his bills would indicate how well he was doing.

Steve
__________________


Reply With Quote
  #3  
Old 06-10-2009, 10:05 AM
turfmaster's Avatar
turfmaster turfmaster is offline
Senior Member
 
Join Date: Apr 2009
Location: Midwest
Posts: 366
Rep Power: 7
turfmaster is on a distinguished road
Default

Some years ago we bought a retail business.
The previous owners told us the business averaged so much per year for the last 5 years.

Our agreement with them was to view their tax returns with our accountant to verify their numbers prior to purchasing the business.
Reply With Quote
  #4  
Old 06-10-2009, 01:37 PM
Steve's Avatar
Steve Steve is online now
Administrator
 
Join Date: May 2003
Posts: 37,277
Rep Power: 10
Steve has disabled reputation
Default

Quote:
Our agreement with them was to view their tax returns with our accountant to verify their numbers prior to purchasing the business.
How did that ultimately work out? Also was there anything in the contract to compensate you if they had lied about the previous income or no?

Do you have any further advice on what to look out for when purchasing a used business?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #5  
Old 06-11-2009, 10:31 PM
AccountingSPOT AccountingSPOT is offline
Junior Member
 
Join Date: Jun 2009
Location: Elma, WA, & Virtually across the Country
Posts: 14
Rep Power: 6
AccountingSPOT is on a distinguished road
Default

If I were buying a business, I would require an audit (done by a CPA) of the financial statements...would you buy a house w/o doing an inspection? Hopefully not! An audit verifies (at least to a very high likelyhood) that the financial statements are accurate and the profits they show are for REAL.

An audit will confirm that there are no errors or fraud going on with the financials. I was trying to find a link to a source indicating just how much an auditor would be liable for, but have been unable to find anything solid. An auditor does hold some liability, I'm just not sure to what extent.

As far as setting funds aside until certain financial obligations are met...anything can be agreed upon in the sale agreement. However, as an honest SELLER, I would not agree to those terms. That would put my business sale profits in the hands of the new management.
__________________
Holly Neitzel
Reply With Quote
Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Forum Jump

Similar Threads
Thread Thread Starter Forum Replies Last Post
Lost Information footerlou Gopher Software Support Archived Question & Answers - Read Only 1 08-02-2007 03:35 PM
Job awarded then lost KimKriel General Talk 5 04-07-2007 05:15 PM
Lost a sale tiedeman Lawn Maintenance / Lawn Renovation 2 02-19-2007 01:42 PM
I lost all of 2006! Gopher Software Support Archived Question & Answers - Read Only 2 11-16-2006 08:35 AM
Lost 1 customer already tiedeman Show Off - Picture Post - Photo Gallery 5 11-16-2006 08:20 AM

» Recent Threads
  RatingTitle, Username, & Date Last Post Replies Views
How busy are you now?
Steve
Yesterday 01:10 PM
Yesterday 11:08 PM
by SGL1
3 69
I have ZERO confidence...
Just for Cuts
05-01-2015 04:24 PM
Yesterday 10:35 PM
by ExtremeLawncareServices
18 328
I'm Back With The Best...
aduttonater
02-21-2015 12:41 AM
Yesterday 08:59 PM
by ExtremeLawncareServices
74 3,082
Pictures of commercial...
avetslawncare
04-01-2015 09:47 PM
Yesterday 07:31 PM
by avetslawncare
34 1,321
Go daddy web site and...
jcurr33
Yesterday 06:00 PM
Yesterday 06:00 PM
by jcurr33
0 30
mowfinder
scaypa
04-27-2015 05:44 PM
Yesterday 01:14 PM
by Steve
1 139
Latest video, Facebook...
Sprinkler Buddy
05-01-2015 06:54 AM
Yesterday 01:09 PM
by Steve
3 123
These are the days on...
ExtremeLawncareServices
01-11-2015 10:41 AM
Yesterday 01:03 PM
by Steve
72 5,797
weed
avetslawncare
04-16-2015 07:56 PM
05-01-2015 11:38 AM
by Steve
8 476
so i need somehelp with...
dalvan0
04-28-2015 07:43 PM
04-30-2015 10:55 PM
by avetslawncare
3 196
Anyone have a Lawn Care...
nishirandall
04-28-2015 08:45 PM
04-30-2015 12:00 AM
by Steve
1 160
mowing pic
joshlawncare
04-25-2015 12:34 PM
04-29-2015 10:55 PM
by Steve
5 263
Big (to me) mulch job
tl757
04-23-2015 05:32 PM
04-29-2015 10:51 PM
by Steve
14 443
Help with a truck
bdodson89
04-27-2015 08:15 PM
04-29-2015 10:47 PM
by Steve
4 199
Ford F250 Wheel loaders...
jrs.landscaping
04-28-2015 05:34 AM
04-29-2015 07:47 AM
by jrs.landscaping
2 150
New company in Michigan
SEM
04-24-2015 09:27 PM
04-28-2015 11:56 AM
by Steve
6 232
Correct me if I'm wrong...
SGL1
04-26-2015 02:41 PM
04-28-2015 06:57 AM
by SGL1
12 289
Total yard rehab
SGL1
04-23-2015 03:59 PM
04-27-2015 06:57 PM
by SGL1
11 366
equipment marketplace?
jrs.landscaping
04-27-2015 04:49 PM
04-27-2015 06:09 PM
by jrs.landscaping
2 142
Buying contracts /...
greenscaper123
04-26-2015 04:46 PM
04-27-2015 05:59 PM
by Steve
2 182
Lawn Care Service in...
Friscobob
04-24-2015 03:33 PM
04-27-2015 05:44 PM
by Steve
4 255
what's the big deal...
Tony317
04-25-2015 02:19 PM
04-27-2015 05:43 PM
by Steve
3 193
Newb Question - Multiple...
DependiLawn
04-24-2015 11:36 PM
04-27-2015 05:36 PM
by Steve
1 185
maintandlawndispatch...
SGL1
04-21-2015 03:31 PM
04-24-2015 04:42 PM
by Steve
9 337
Thoughts on Undocumented...
element009
09-25-2011 11:08 AM
04-23-2015 09:32 PM
by Chilehead
56 15,749
Hello Everyone
DesignsByBnC
04-22-2015 04:07 PM
04-23-2015 02:19 PM
by DesignsByBnC
2 215
The upcoming rainy...
5StarLawnscaping
04-21-2015 01:22 PM
04-23-2015 12:54 PM
by Steve
7 304
color fliers?
holymoly
04-18-2015 02:32 PM
04-23-2015 12:50 PM
by Steve
12 516
WARNING! Especially to...
SC93
04-19-2015 12:05 PM
04-22-2015 01:39 PM
by Steve
14 572
Could be great news for...
SC93
04-14-2015 11:06 PM
04-22-2015 01:28 PM
by Steve
15 637
quick pic
joshlawncare
04-14-2015 07:49 PM
04-21-2015 05:01 PM
by joshlawncare
4 458
Got Inspected today
swstout
08-09-2010 10:31 PM
04-21-2015 03:53 PM
by SGL1
10 4,136
Smoked my first belt!
SGL1
04-20-2015 08:46 PM
04-21-2015 03:28 PM
by SGL1
4 278
lawn care business...
holymoly
04-18-2015 02:56 PM
04-21-2015 06:18 AM
by holymoly
3 376
landscape insurance
clarkslawn
03-30-2015 10:14 PM
04-20-2015 10:02 PM
by SGL1
4 609
Poll & Discussion...
CHEESE2009
09-16-2011 06:16 PM
04-20-2015 08:20 PM
by avetslawncare
27 5,807
Aerating / Dethaching...
Hard-Body lawn & garden
04-12-2015 07:53 PM
04-19-2015 08:49 PM
by Chilehead
17 741
Start LIKING FACEBOOK...
rlclawncare123
02-26-2015 12:06 AM
04-19-2015 09:21 AM
by KJ90
8 1,138
bidding a cemetery....
NPM_LLC
03-28-2015 10:56 AM
04-19-2015 05:26 AM
by RSE
22 1,198
Hustler Raptor
SGL1
04-13-2015 09:27 PM
04-18-2015 07:53 AM
by SGL1
15 644
is craiglist good to...
JBENI
04-16-2015 11:11 AM
04-17-2015 10:25 PM
by Wolf4dk
11 561
Am I missing something...
googus
04-11-2015 06:33 PM
04-17-2015 08:01 PM
by avetslawncare
10 691
Hello
sonny54
04-16-2015 09:49 PM
04-17-2015 03:10 PM
by Steve
1 308
Unreal
Chilehead
04-09-2015 09:12 PM
04-17-2015 08:27 AM
by Chilehead
11 697
starting a lawn care...
JBENI
04-14-2015 09:03 AM
04-17-2015 08:03 AM
by JBENI
14 712
Finally got a warehouse
avetslawncare
03-12-2015 07:52 PM
04-16-2015 07:52 PM
by avetslawncare
23 1,531
New 14 x 7 Enclosed...
whitepropertydetail
04-15-2015 06:46 PM
04-16-2015 03:40 PM
by Steve
1 371
older used dump trucks
SECTLANDSCAPING
09-22-2011 12:33 AM
04-16-2015 12:41 PM
by biglee
21 8,192
Tax Poll
Steve
04-15-2015 02:13 PM
04-15-2015 02:13 PM
by Steve
0 350
lawn care by Aj
aj10261984
04-14-2015 06:50 PM
04-15-2015 01:43 PM
by Steve
2 393
» Popular Tags
ad landscaping aerocore apartment complex auger bark billy goat brushcutter blades blowout bob villa collections commercial contract help curb appeal services demonstration design edging employee problems equipment rental facebook ferris flyers foreman grass growing a lawn care business hardscapes hills hiring husqvarna hydraulic john deere quik trac landscape landscape services landscaping training lawn aeration lawn care lawn mowing marketing marketing secrets more customers business mr dave mulch ordinance past due patio install per hour charge pricing profit on employee pto push versus ride running a business scag v-ride scripts secrets to landscaping seo shell small engine repair square foot steep lawns sulky theft toro grand stand trailer tree trimmer rack truck new used landscape up sell employee web design website won't return www.greenturion.co.za
Powered by vBadvanced CMPS v3.1.0

All times are GMT -5. The time now is 02:37 AM.


(C) 2011 Riggs Publications - Terms of use & Privacy Policy

All times are GMT -5. The time now is 02:37 AM.

(C) 2011 Riggs Publications - Terms of use & Privacy Policy