Business
Business
Posted on Oct 4, 2017
Any veterans out there who have experienced buying businesses?
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Business
Small Business
Certified Public Accountant (CPA)
Law
Retirement
Posted >1 y ago
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When I got out I purchased a failing Temp Agency Franchise. It was a blue collar temporary agency in the DC metropolitan statistical area. I did two years of research prior to buying and getting out of the military. A competitor dominated the market. And the corporate strategy was aimed at factory work, and unskilled construction labor. Not as a big pie to fight over as you might think in DC.
I did two years of homework before I bought. I went after the hospitality industry (mostly high end hotel and convention center staff) which was almost completely unserved. I went after the high hotels and convention centers that needed a core staff of their own, but a fluctuating reserve based on convention business. I went from 16 laborers per day average when I bought it, to 500+ per day when I sold the agency 3+ years later. I had to be willing to work with the unions and eat the losses if I put in laborers that couldn't meet the turn rates high end hotels demand. Plus I developed a fluctuating reserve of about 60 skilled co-axial cable and fiber optics cable pullers.
The corporate office exercised its' option to buy me out. The price was determined by a franchise agreement formula , with a based on revenues and profits, I was not complaining. The three plus years set me up to be independently lower middle class for the rest of my life.
I did two years of homework before I bought. I went after the hospitality industry (mostly high end hotel and convention center staff) which was almost completely unserved. I went after the high hotels and convention centers that needed a core staff of their own, but a fluctuating reserve based on convention business. I went from 16 laborers per day average when I bought it, to 500+ per day when I sold the agency 3+ years later. I had to be willing to work with the unions and eat the losses if I put in laborers that couldn't meet the turn rates high end hotels demand. Plus I developed a fluctuating reserve of about 60 skilled co-axial cable and fiber optics cable pullers.
The corporate office exercised its' option to buy me out. The price was determined by a franchise agreement formula , with a based on revenues and profits, I was not complaining. The three plus years set me up to be independently lower middle class for the rest of my life.
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SPC Thanh Nguyen
Maj John Bell ,
Where did you originate your funds (e.g. SBA, IRA/401k, or other sources)? I am currently pursuing business owners who are looking to retire/exit soon but still protect their legacy by preserving their brand and employees.
Thank you so much for taking the time out of your day to share your story with me.
Where did you originate your funds (e.g. SBA, IRA/401k, or other sources)? I am currently pursuing business owners who are looking to retire/exit soon but still protect their legacy by preserving their brand and employees.
Thank you so much for taking the time out of your day to share your story with me.
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Maj John Bell
I come from a family of cheap skate savers. Dad's absolute law - Every dollar I made while I lived at home, starting at age 5, I got 10% for fun and 90% went to savings. When savings got to be more than six months worth of fun money it was put in an investment (primarily stocks). Starting at age 10 I was working my own business (mowing lawns, weeding, dog walking, oil changes, chores, errands etc. etc.) plus I had a job. I worked full time in the summers. Once I moved out 25% pre-tax saved/invested.
I'm 56, I've never owned a new car and I've only had 4 cars since I was 14 (rural juvenile drivers license in AZ). I rarely buy new anything , and do not finance or buy on credit a non-revenue generating, depreciating asset.
I had the franchise fee (discounted deeply since it was an existing failing franchise), plus two years' living expense (lived with wife and two kids upstairs from the business in an industrial park), plust 1 years fixed overhead. The corporate office extended a payroll line of credit of the last 180 days of accounts receivable. They charged 1% on any account 60 days past due.
I'm 56, I've never owned a new car and I've only had 4 cars since I was 14 (rural juvenile drivers license in AZ). I rarely buy new anything , and do not finance or buy on credit a non-revenue generating, depreciating asset.
I had the franchise fee (discounted deeply since it was an existing failing franchise), plus two years' living expense (lived with wife and two kids upstairs from the business in an industrial park), plust 1 years fixed overhead. The corporate office extended a payroll line of credit of the last 180 days of accounts receivable. They charged 1% on any account 60 days past due.
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Never bought a business, but I've started two and working on building a large non-profit right now SPC Thanh Nguyen All can be very challenging!
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SPC Thanh Nguyen
COL Mikel J. Burroughs, let me know if there's any way I can help. I'm currently looking for ways to help veterans with their personal finances and help position themselves into income producing ventures.
Thanks for sharing Mike!
Thanks for sharing Mike!
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COL Mikel J. Burroughs
SPC Thanh Nguyen - There are always to help Thanh - let's get on a call down the road to discuss ways we cna help each other. Thanks
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