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What do you think of a business that Grosses $475K a year. But the costs (overhead),etc is $250k

Originally Posted by PinchandBurn

What do you think of a business that Grosses $475K a year. But the costs (overhead),etc is $250k

That would depend upon the sector. Are we talking a medical practice?

Originally Posted by 101N

That would depend upon the sector. Are we talking a medical practice?

no


but what if it were. General principles are similar right?

Originally Posted by PinchandBurn

no


but what if it were. General principles are similar right?

I think you need to compare apples to apples. If I'm looking for a job as a physician in the US I'm going to be thinking MGMA, comparing income to my peers.

Margins differ from sector to sector. If this were a car wash or coffee shop then this is a marvelous margin particularly if all of the management salaries are included in the overhead.

Originally Posted by 101N

I think you need to compare apples to apples. If I'm looking for a job as a physician in the US I'm going to be thinking MGMA, comparing income to my peers.

Margins differ from sector to sector. If this were a car wash or coffee shop then this is a marvelous margin particularly if all of the management salaries are included in the overhead.

Yes, it's something like you are alluding too.
But it's a franchise. So there's a 'royalty' something b/w 5-7%

Originally Posted by PinchandBurn

What do you think of a business that Grosses $475K a year. But the costs (overhead),etc is $250k

Sounds like a Subway restaurant, am I right?

Originally Posted by powermd

Sounds like a Subway restaurant, am I right?

lol.....perhaps

Originally Posted by PinchandBurn

lol.....perhaps

A friend of mine who does anesthesia around NY has been talking about starting a biz of some sort for years.. a chain of Subways came up as an idea. Other ideas, a string of ATMs and laundrymats.

Originally Posted by powermd

A friend of mine who does anesthesia around NY has been talking about starting a biz of some sort for years.. a chain of Subways came up as an idea. Other ideas, a string of ATMs and laundrymats.

question is who is going to 'run the store'. I'm sure you and your anesthesia buddies wont be tehre all the time. The issue then becomes 'trusting' someone else, and they often time STEAL, especially if they know two docs that are preoccupied own the place....


These can be lucrative, but usually a physical presence needs to be there.

Originally Posted by PinchandBurn

lol.....perhaps

Numbers sound low for a subway

any business that generates more income than expenses is a good business - especially when the upfront capital to get that business is low and re-captured quickly...

Originally Posted by lonelobo

Numbers sound low for a subway

Really? These sounded high relative to what my friend was quoting. Basically it only made sense if you were going to make it a family business and put everyone to work in 6 different stores and everyone was willing to work for cheap.

Originally Posted by Tenesma

any business that generates more income than expenses is a good business - especially when the upfront capital to get that business is low and re-captured quickly...

purchase price is $650k.....

Originally Posted by PinchandBurn

purchase price is $650k.....

Is that a single store?

650k to get 225k/yr in passive income --- that's pretty darn good if you ask me... show me where else 650k can generate that kind of return?

Originally Posted by specepic

Is that a single store?

yup...keep in mind that 250K number is before taxes. Also, keep in mind that currently it's a 'corporate' store.

For a frachisee, one has gotta add on a royalty fee of 5-7% weekly and then also since I dont have $650k cash (obviously I have to pay interest on the loan)....

If you take out a loan for 500k at 8%..... and you get a return of 100k/yr - you would be clearing 60k/yr on a 150k cash down-payment... that is great return --- as long as this is a turn key operationg and doesn't require constant supervision/management....

what is included with expenses, i.e. is that profit or only the return if you are the onsite manager/chief sandwich artist

Originally Posted by PinchandBurn

What do you think of a business that Grosses $475K a year. But the costs (overhead),etc is $250k

I'd call that $225K/year profit. But it is never that easy.

If you can do it on 10 hours per week, that's $450/hour

If it's 100 hours per, it's $45.

9/10 people would love to have that opportunity. The other 1/10 already makes more than that.

Originally Posted by lonelobo

Numbers sound low for a subway

i looked at purchasing a subway, those numbers are amazing!

Originally Posted by Jcm800

i looked at purchasing a subway, those numbers are amazing!

Looking into "Massage Envy" franchise myself

75% of pts ask about massage, and I can use a good massage myself

Originally Posted by lonelobo

Looking into "Massage Envy" franchise myself

75% of pts ask about massage, and I can use a good massage myself

I had a massage therapist in my old pain practice. Cash only. No one wanted it unless I could bill it to their insurance. If I could have done that, I could have hired 25 massage therapists.

Watch 'restaurant impossible' then think about buying a restaurant. Granted, this is a franchise and I'm assuming you are not a complete idiot........ But still

massage can be a money-maker... just as long as you don't expect your current patient population to be driving that business..

Originally Posted by Tenesma

massage can be a money-maker... just as long as you don't expect your current patient population to be driving that business..

No have over 150K drawing area with no spas, or like businesses ...will let you know in year if it was good idea