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5 Must-Ask Questions Before Buying a Dry Cleaning Business in Charlotte, NC
As disposable income is on the rise, Americans are turning to the services that make their lives easier. Laundry services, especially, reap the benefits of surplus earnings. In 2019, the dry cleaning industry generated $9 billion of revenue. If you’re considering buying a dry cleaning business in Charlotte, NC, now may be the time. Continue reading for guidance through these must-ask questions during the purchasing process.
Your Guide to Buying a Dry Cleaning Business in Charlotte, NC
Here are five questions you should be able to answer before buying a Charlotte, NC dry cleaning business.
How will you differentiate your dry cleaning business from the rest?
As of 2016, there are over 100 active dry cleaners in Mecklenburg County, so you’ll want to establish your store from other companies in the area. Start by researching business tactics of leading franchises in the industry to develop a successful business model. From there, you can learn the dos and don’ts of dry cleaning. Consider offering pick up and drop off dry cleaning services. A delivery service could give you the upper hand over other dry cleaners in the laundry business.
Aside from offering quality service, devising a comprehensive marketing plan complete with social media presence and alluring signage is an excellent way to stand out from competitors.
Why is the current owner selling?
When you first meet the owner, you should ask them why they are selling their dry cleaning business. Most often, business owners sell because of burnout or illness. However, you’ll want to be wary if this particular owner is selling due to financial hardship. Even though your business experience could turn this dry cleaning shop around, it could be an indication that this purchase comes with a high risk. Always complete thorough research before signing documents.
What does the sale include?
Like every small business, equipment for day-to-day operations adds up to a substantial cost. Be sure to ask the current owner if any of the equipment will be included in the sale. Based on their answers, you may need to research the necessary material to run daily dry cleaning operations. You may have to figure new dry cleaning machines and other dry cleaning equipment into your overall budget.
If you’re satisfied with the current location of the dry cleaner business, you will need to ask the owner whether they own or lease the property. If they own the storefront, you should inquire whether the deed will be apart of the sale, and if they rent, you should discuss new terms with the landlord.
What are the business’s current expenses?
Once you’ve determined equipment and real estate costs, you should ask the current owner about their day-to-day expenses. Ask to review their financial documents, so you have a better understanding of the everyday costs of the shop. Documents like tax returns, cash flow, income statements, balance sheets, and their gross income will give you a better understanding of their average costs.
What is the asking price for the dry cleaning business?
Finally, you’ll want to ask the owner their selling price and how they decided upon that number. If they used a professional valuation service, it’s most likely an accurate reflection of the value of the business, and you’ll have less room to negotiate.
When you’ve answered these questions, and you’re ready to purchase a dry cleaning business in Charlotte, NC, get in touch with the experts at the VR Charlotte office! Our expert business brokers help business buyers secure their dream business.