Urgent advice needed for tomorrow

[gemma26]

Hi i was just wondering what qestions i should be asking when i go to veiw a beauty buisness tomorrow
hope you can help as i dont want to leave anything out!

this is what i have so far

monthly outgoings
rent
gas
electric
products
phone bill
staff wages
should i ask to look at an appointment book to get a better understanding of how busy the shop can be
weekly takings
im sure there is a whole lot more but my mind has gone blank ! any suggestions would be much appreciated

 

[TracyS]

Hi i was just wondering what qestions i should be asking when i go to veiw a beauty buisness tomorrow
hope you can help as i dont want to leave anything out!

this is what i have so far

monthly outgoings
rent
gas
electric
products
phone bill
staff wages
should i ask to look at an appointment book to get a better understanding of how busy the shop can be
weekly takings
im sure there is a whole lot more but my mind has gone blank ! any suggestions would be much appreciated

If it's a business you're thinking about buying you should have access to their books to see what the business is currently generating and it will help to give you an idea of where the 'slack' currently may be - an accountant should look over them for you.

Fwiw, I would be asking about the client base, average spend per client, do some research on the area, ask why they're selling (are they actually going to be taking clients with them if they are moving premises etc). If it's a rented property any clauses with regard to subleasing. current treatment list and most popular/profitable treatments and how that compares with what you'd be offering.

That's just a few off the top of my head - hope it gets your mind going again

good luck

 

[geeg]

I would want to see their books and I would ask to see them. I would go through a Due Diligence which will provide actual proof of turn over figures, the number of clients they are doing and the expenses that are being incurred such as the ones you mention: Rent, Rates, Utilities etc.

 

[gemma26]

Thankyou tracey that information has really helped my husband is an accountant so if i decide im intersted then i will get him to take a look at the books.Tomorrow is just a informal chat so i was unsure what i should be asking on the first visit however want to ask as much as i can to get a feel for the place x

 

[gemma26]

Thanks geeg would you want to see their books on the first visit ? as i am going on my own and my husband will be taking over the accounts side of the buisness .

 

[geeg]

Thanks geeg would you want to see their books on the first visit ? as i am going on my own and my husband will be taking over the accounts side of the buisness .

Well you certainly need to see them soon or you can't move on with a decision. I would tell them that that is what you want to do and your handy husband can look them over for you.

 

[kimi1101]

Would ask to see accounts asap as Geeg says
Would want to know what is happening with staff, who is staying who is leaving.
which members of staff are busy and with what treatments
What the staff are paid, their holiday entitlement etc - what should be in their contract.


When I bought my salon, the woman who ran it gave me the accounts. She said there was £xxx profit. But this was with her chair rentals, which had just left. When I pointed out that without the chair rentals the salons profit was grossly reduced, she said "yeh but youll be here making money now" Well....i'm not paying her for me to be there making money, paying her cos I can turn the salon around? Nope. I paid less than half what she orginially asked for.

Ask them their price (if you do not already know it) and if there is room for negotiation.

I'd advise taking someone with you as there will be a lot of information to take in!

Good luck xx

 

[gemma26]

Thank yoe kimmy some good points there i would like to have my own staff so what would happen to hers am i allowed to have my own staff just so much to take in ! x good points about chair rentals etc

 

[kimi1101]

Well with regards to her staff, there are laws in place which may restrict you from getting rid of them. If you are buying her business then the staff have rights as they could have been employed for a long period of time, so you can't just let them go. If someone has been employed for less than a year you can let them go without fear of a tribunal, provided you have not discriminated against them. However there are lots of hoops for you to jump through if they have been there for more than a year. ACAS would be able to help you, and remember Google too!

Also you need to bear in mind, if the salon has a new owner and all new staff, clients may not return as they may have liked the way the old staff did their nails/massage/waxing. You may find some staff will be invaluable, even just to help you get on your feet at first.

 

[kimi1101]

I would also say go in with confidence, if you go in with a "I dont have a clue what I'm doing" persona then it puts you at a disadvantage. You are a very knowledgeable business woman, who is there to assess the facts. And if some things are discussed that you are not sure about, then you can come back here and tell us and we will help. Feel free to PM me with any issues and I will help x

 

[Mike16300]

As for the existing staff, you need to look at TUPE guidance, there's
one here : -

Business Transfers and takeovers (TUPE) | Policies | BIS


Another thing to be sure of is the cost of business rates, they might be exempt for now under the small business rates system, but this expires next year, so you will need to know what the cost is, so you can evaluate the business.

If she is selling the salon, then she should have no problem giving you a copy of the last 2 years accounts, and any interim accounts made up for this year.

Will you be taking over the business bank account too, useful if she has a current merchant account.

Good luck
M

 

[gemma26]

Thanks evryone and kimmy feeling like a confident buisness woman already thanks to you guys! however do not know how to pm yet lol not the best on computers however will let you all know how i get on tomorrow. And i know this sounds bad but i have done research round the area and a few people said they was gonna go in but when they seen the woman who would be doing treatments they decided not to! basically it was down to her appearance and overweight and they said they wouldnt want her treating them which i thought was obsurd as she could be great at her job! however they didnt care and said with her being a therapist she should be of better appearance i am all for good hygene and cleanliness however if i was to keep her on do i run the risk of losing clients if i was to go ahead and buy this business.

sorry to rambke on but i appreciate all feed back