Small business owners

[WreckerX5d]

So my woman and I (Im mostly just helping, dont care to run it myself) are looking into buying/leasing a spot, New York area specifically. It'll be for a nail salon and about 2000sqft.

So what's the best option to go, buying an existing salon, or leasing a blank one. What are the benefits of buying a preexisting location, when we would just have to remodel the entire thing and expand. We have a place in mind, but the owner wants $60k for her spot, and 1000sqft will need to be added ontop. Mind you, that spot is still a lease, so we'd still have to make monthly payments. I don't see any benefit in this, but I'm not 100% sure as I've never done this before and don't know what's good and what's not.

Financing the upfront costs I know about already.

Any other suggestions and tips that you guys have for a first time startup, please share.

[PoorLurker]

Why would a 1000sq ft need to be added to the nail salon if a profitable one already exists there.

The owner wants $60k for her business (chairs, booths, etc?) or to buy her out of the location?

Just curious...

[WreckerX5d]

Originally Posted by PoorLurker

Why would a 1000sq ft need to be added to the nail salon if a profitable one already exists there.

The owner wants $60k for her business (chairs, booths, etc?) or to buy her out of the location?

Just curious...

The supplies are included..and that's really about it. We'll get rid of mostly everything else and expand. The addition is because that location doesn't have enough space for the spa section. 2000sqft is what we have planned out for.

I'm more on the side of finding a blank location and starting from there, unless someone can tell me a benefit of getting the existing location for what I see as being completely overpriced.

[PoorLurker]

How many nail salons are in the surrounding areas?

Often times people may be creatures of habit so they will return to your woman's place because that is where their old nail salon was. For some service industries, people will move with their "stylist" though. I am not sure if nails are the same.

Seems like location is very important to a success of a business in a competitive market.

[TheHouseWon]

Nail salons are great fronts for money laundering

[nyalpine90]

i think the key for salon/barbershop/hairstylist is location. Check the area to see how far is next salon is.
existing location may have violations so get it inspected.
how about parking?

[csu87]

Originally Posted by PoorLurker

How many nail salons are in the surrounding areas?

Often times people may be creatures of habit so they will return to your woman's place because that is where their old nail salon was. For some service industries, people will move with their "stylist" though. I am not sure if nails are the same.

Seems like location is very important to a success of a business in a competitive market.

^this

Starting from scratch at a new location will be rough unless you have existing clientele that will be coming with you to a new location.

OP, have you looked through the financials of the existing nail salon? That will show you if an initial $60k will be worth it or not. Also, is in a high traffic spot or not.

We just recently bought the building our store is in, but only because the owner of the building died. Whether we are paying rent, or paying for upkeep/maintenance, we are still spending about the same amount per month in building costs.

[Wah]

Starting a business from scratch has its risks because of the initial cost of buildout/equiment purchase. When you build from a new space, you will be paying off loans, rent and wages while trying to build a customer base from nothing. You will be bleeding money in the beginning unless you happen to find an area that has a real need for your service (which in NY probably doesn't exist).

Get a good idea of what it would cost to start up, and then compare it to the $60k price you were offered. Look at the competition in the area of both the location you are thinking of starting up, and the location of the biz you are thinking of purchasing. Tax returns from the existing business will give you an idea of income/expenses, but I've heard a lot of nail salons are cash only for a reason, so take what you read with a grain of salt. You are thinking of doubling the size of the store and buying all new equipment, so be sure to include those costs in your evaluation. If you are a start up, marketing will be a big expense.

There is no right or wrong answer here... in the end, it comes down to the customers coming through the door.

[pz619]

Originally Posted by TheHouseWon

Nail salons are great fronts for money laundering

Really any cash based business. But I'd select one that wouldn't require health inspections.

I mean... you know... that's just what a friend told me.

[Biorin]

Originally Posted by TheHouseWon

Nail salons are great fronts for money laundering

Okay, Saul.

[TheHouseWon]

Originally Posted by Biorin

Okay, Saul.

Haha, reference noted

[overcoil]

Originally Posted by TheHouseWon

Nail salons are great fronts for money laundering

And which business aren't ?

[jlstyle]

Any pre existing businesses will ask for the money - aka key money - for their businesses. It includes FF&E of the existing business, but it is mainly for their customer pool and improvements made on the property. Of course lease is the separate thing on top of it. Key money for any business is almost always there unless you are to fit out a brand new space or previous business spot was haunted. Even some brand new locations could require some key money if it is on the prime spot.

[pz619]

Originally Posted by ScottSinger

And which business aren't ?

Those that are mostly electronic transactions.

Again, just what I've heard from a "friend".