That's my problem, not yours.
Your problem is putting up the £5K if you want to take the wager instead of the OP
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Selling my online store, what else can I do?
- Thread starter DoolallyTap
- Start date
Your problem is putting up the £5K if you want to take the wager instead of the OP
That's my problem, not yours.
Your problem is putting up the £5K if you want to take the wager instead of the OP
My nearest and only current competitor is government funded to the tune of £6.8m. They've tried 4 times to replicate what I created from scratch and have recently engaged the services of a global services company who's UK set up turned over £2.8m last year, the aim being to have a 5th go at what I/my company do. They are 6 months in and failing miserably. Why? They don't understand the market or have the confidence of people who do.
You'd need much more than a savvy kid to take me on...
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The challenge I offered was in relation to reproducing the OP's business rather than some unknown and unseen other entity.
I've already got someone in mind to do the job - a sharp, young lady who's recently come over from Ukraine and lives with us (I sponsored her under the UK's Homes For Ukraine programme). She's a lovely kid, just completed her masters and she's a dab hand at social.
So I'm all ready if the OP (or you) want to take the challenge instead of posing nonsense questions about what I'd do if she has a hangover!
I've already got someone in mind to do the job - a sharp, young lady who's recently come over from Ukraine and lives with us (I sponsored her under the UK's Homes For Ukraine programme). She's a lovely kid, just completed her masters and she's a dab hand at social.
So I'm all ready if the OP (or you) want to take the challenge instead of posing nonsense questions about what I'd do if she has a hangover!
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To try and summarise all the thoughts of many posters.
The valuation of 2 x profit is way too high for no other reason than your business can be easily replicated. I have no idea of how much you could get but at best it could on be a couple of thousand but probably a lot less.
The stock levels are way too high. At most you only really need 6 months to a year of stock depending on the supply chain lead time. You need to dump anything that hasn't sold in a year.
The business is being sold as a job for someone. Which means it won't attract investors but may be of interest to someone wanting a bit of spare time cash. These people don't have a lot of money.
This all means you won't be getting a retirement nest egg. More likely it won't ever sell and you will be left with a ton of stock as new designs become available on other platforms and/or when the craze dies off and something new attracts fashionistas.
The valuation of 2 x profit is way too high for no other reason than your business can be easily replicated. I have no idea of how much you could get but at best it could on be a couple of thousand but probably a lot less.
The stock levels are way too high. At most you only really need 6 months to a year of stock depending on the supply chain lead time. You need to dump anything that hasn't sold in a year.
The business is being sold as a job for someone. Which means it won't attract investors but may be of interest to someone wanting a bit of spare time cash. These people don't have a lot of money.
This all means you won't be getting a retirement nest egg. More likely it won't ever sell and you will be left with a ton of stock as new designs become available on other platforms and/or when the craze dies off and something new attracts fashionistas.
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Surprised everyone else missed this point.
I have been speaking with the owner privately and raised this concern as being the biggest risk to the business.
Straight away you could not use Shopify as they will take your store offline especially seeing Disney.
It's a big risk for Google and Facebook advertising as it could get your account banned.
99% chance there is no license. No matter who he is buying from most of these are being made in China. There is no way anyone has a license.
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You once told me I hadn't got a business...despite it being an unknown entity? I hoped I could coax you into parting with an easy £5k
QUOTE: 'Your target buyer is an amateur who doesn't know what he's doing and who's willing to jump in without professional assistance.'
'What can be done, what may be done, what is possible in the future is not what the buyer is paying you for.'
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Er, I've said that to 1000+ people. I've no recollection of saying it to you but it's entirely possible I did. Forgive me if I can't remember the specific case.
But well done to you if you've built it from a job to a business. Excellent. <pat on the back here>. If you've done it, of course, and if you have a complete management team in place with no business dependence on you. If so, well done.
Back to the main question: are you putting up the £5K, or not?
There's a bonus for the OP if we proceed with this. At the end of the process if I lose, in addition to paying the £5K I'll buy his business for 2x. (Obviously, it won't be 2x the past earnings. Given the competition, his t/o and profit will likely fall. So I'll buy the operation at 2x the going annualised profit. It'll could be worth a bolt-on at that new, drastically reduced price. We wouldn't need the stock).
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To the OP. IMHO you are advertising in all the right places, but the price is too high. You can't use multiples like this on a business of this size. My suggestion would be to start at £25k plus stock (at value or discount). You may not be able to sell all of the stock as buyers may want to pick and choose.
It may be worth taking down all your ads, and reword and repost them a day later. This positions them as a new listing which might yield some response. I would change all the pictures to freshen it up also.
It might be worth posting on eBay as well. There is a businesses for sale category on there.
It may be worth taking down all your ads, and reword and repost them a day later. This positions them as a new listing which might yield some response. I would change all the pictures to freshen it up also.
It might be worth posting on eBay as well. There is a businesses for sale category on there.
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Including folk like the one who runs a corner shop that you don't consider a business?
For one business, £8.5k this month. Outgoings £150. Involvement...... Necessary - 9 emails, lost passwords, payment issue...1hr. Chosen input - kicking arris, social media 10 hrs. Unique - 99.9% of market - profitable. No management team so not a business?
No. I don't need your £5k
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Nope, no business, not to the typical buyer / investor.
I don't care what you think a competitor has spent to try and reproduce what you do, or how many million they turnover. I often hear that kind of self aggrandisement.
People think that it makes their business sound more valuable. It doesn't. It makes the business sound even more pathetically dependent on their own individual skills/contacts/whatever.
You might have 99.9% of the market but you 100% have a job.
Hope that clarifies things for you.
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Stop making up your own soundbites.
There is no such thing as a typical buyer. You may operate at the Bentley end of the market but there are plenty of successful businesses selling Corsa's.My mate who has a million quid's worth of stock on the forecourt of 2 sites doesn't have a management team. Established for as long as I can remember, respected, great reviews, good buying contacts and contracts. All completely worthless of course?
Statements of fact, and yes I'm very proud of the position achieved.
You posted while I was editing.
That you have to use terms like self aggrandisement and pathetic in an attempt to subdue comments that are far from your comfort zone speaks volumes.
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It’s a business to the owners until they try and sell it when it becomes a job. It’s about perception to the potential buyer.
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What converts it from a business to a job?
Buyer puts his daughter, employs a manager in to run it, is it a job, an investment, a business?
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Indeed. But 90% of the 'Corsas' advertised on businessesforsale, Daltons etc do NOT sell. I've been spidering those sites every day for years. What I get on each crawl is carefully field separated and databased. 90% of businesses that brokers put on those sites are still there 12 months later.
Bear in mind that there's no shortage of buyers. I don't normally sell businesses but I assisted a friend to sell a business in 2024 - Phantom Ltd (just under £1m in EBITDA). We had 80+ qualified and vetted buyers and the business sold for a very nice sum (more than double what the shareholders were expecting) . Give me any business making that kind of profit and I can get them no less than two DOZEN solid offers within 6 months. Unless there's something seriously wrong with the business, it will sell, 100% - there's a sh*tload of funded buyers out there.
Your Corsas don't sell. It's not because there's a shortage of buyers. It's because they have no transferable value and they're seen as crap.
Yup, complete job, and a complete hash of a job if I may add. He's respected, has great reviews etc., because HE treats customers well, HE doesn't sell them dodgy cars, HE honours warranties, HE has good relationships with buying contacts etc. The reputation is HIS, not the business's. Completely worthless? As a business, yes. His stock has value, sure, and maybe other assets, but the business doesn't. Tough titties.
Still a job!
Till the business has a year or two of performance under the new management, there's no evidence that the manager / the daughter is capable of running the business to the same standard. Even then, because of the small management team - just one person - most buyers will run a mile. Those who do bite will protect themselves with all manner of warranties and indemnities in the contract to protect against this one person leaving. They'll expect ALL their money back if the (single) key person leaves, dies or is unable to perform. They'll want a large chunk (probably ALL) of the price on an earn-out. Selling will be somewhere between very, very difficult and a snowball's chance in hell.
You may not like it, but that's the reality in the market. You get the occasional idiot of a buyer, someone who's stupid enough to do the deal himself without sound external financial / legal advice, but they are rare.
My day job is assisting mid-market businesses with finding the right M&A firm to handle their equity event - disposal / divestiture / recapitalisation / hive-off / IPO / EOT / whatever. It's a trickier job than appears at first sight so boards / shareholders hire me to do it. I'm the only person in the UK doing this. I have 100% of this specific advisory market. I'm a sole operator. I often get clients asking me to handle the sale myself and I'm sometimes tempted to hire staff and build a business brokerage / M&A operation, but I don't. If it's of any consolation to you, this too is a job, not a business.
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Listen to yourself speak it's absolutely painful to read. You literally refer to what you are talking about as a business just below calling it not a business
Whether you consider something a business or not does not change the fact that it's a business. It may be an earlier stage business, it may be a business that isn't suitable for an investor or have a high demand for sale but that doesn't make it "not a business".
Outside of what we all think about the OPs business he deserves some level of respect for creating something from nothing. To call his work "not a business" is an insult to everyone on this forum.
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It’s a business to the owner. Nothing wrong with calling it that. But should you wish to sell the business and you are necessary for viability then it’s a job you are offering.
That’s the point @Clinton is making.
An investor doesn’t want a job. They want to buy a business where ownership is transferred and everything keeps on going as before. Think on it like a share transfer.
That’s the point @Clinton is making.
An investor doesn’t want a job. They want to buy a business where ownership is transferred and everything keeps on going as before. Think on it like a share transfer.
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The business has great reviews. The business is respected. The business doesn't sell dodgy cars and treats customers well. Established 40 years, owns freehold on both sites, used the profits to start a building company, last project 17 apartments. Just a job!
I sold advertising for many years, mistakenly by your book, thinking that I was selling to businesses. Rest in Peace Don Lewin of (somewhat ironically) Clinton Cards fame who passed away yesterday the 25th October, who when I dealt with him simply had a job in a couple of shops.
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Who said anything about selling to an investor? A business can also be sold to somebody who wants 'a job' or the bones of something that they can grow into a bigger business.
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Which is what I said. Nothing wrong with having both. @DoolallyTap is selling to someone who wants a job. He isn’t selling to someone who wants to invest in a business that runs itself. Because of this their valuation needs reassessing.
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Businesses range from the sole trader micro business all the way up to the multi-national conglomerates. If any of these want to sell up the means of selling, valuations and processes will be different. How your business is perceived by the buyer will depend on what they want. It may be they want a job but if that job relies on the skills of the current owner the value of the business decreases. If the job is simply picking and packing with minimal skills then the valuation may be higher. And so on up the tree.
I couldn’t sell my business as it’s totally reliant on my skills as a developer. It’s a job.
I couldn’t sell my business as it’s totally reliant on my skills as a developer. It’s a job.
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Yes.owns freehold on both sites, used the profits to start a building company, last project 17 apartments. Just a job!
Like many people on a salary, albeit a salary that he worked his butt off to earn, he saved his money and put it into property (and in this case a building company as well).
If he had the skills to build a business, a proper business and not a job, he could have sold the business for 10x profit (the multiple on mid-cap businesses) and, if he had been following me or any good M&A commentator in LinkedIn, he'd have cashed out before the Entrepreneurs' Relief LTL went down to £1m. He (and his wife co-shareholder) would have paid only 10% Entrepreneurs' Relief (now BADR) on £20 million of the capital gains.
On the rest of the money, he'd have benefitted from substantial shareholding exemption as he had set up a holding company and put other structures in place.
And about any capital gains that didn't benefit from all the tax reliefs etc - he could have used that loose change
to buy the freehold on the two sites you mentioned and to start a building company (and to potentially obtain roll-over relief as well).Or he'd have created an EOT and paid no tax, absolutely zero tax, on the entire capital gains.
Your friend saved money after paying silly PAYE, Employer and Employee NI on part of his salary and dividend tax on the rest of the salary, and he invested it. That's what a lot of people who don't own a limited company do. Anybody can do that. It suggests he's frugal and conservative with his money, and he works hard in his job, not that he's a good businessman or that he has built a business.
At any point if he had died, his widow would have had as much luck selling the 'business' as the OP is having. I've seen that sad situation far too often - no succession plan = worthless and unsellable 'business'.
In posting this, I'm hoping to raise awareness among those who've built a job for themselves many of whom think that this is a viable pension plan and that one day they can sell their 'business' for mega bucks. They need to wake up and smell the coffee. What they THINK that acquirers want is very different to what acquirers actually want.
Take my advice or leave it but it's me out of this thread now.
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LOL...........Yes.
Like many people on a salary, albeit a salary that he worked his butt off to earn, he saved his money and put it into property (and in this case a building company as well).
If he had the skills to build a business, a proper business and not a job, he could have sold the business for 10x profit (the multiple on mid-cap businesses) and, if he had been following me or any good M&A commentator in LinkedIn, he'd have cashed out before the Entrepreneurs' Relief LTL went down to £1m. He (and his wife co-shareholder) would have paid only 10% Entrepreneurs' Relief (now BADR) on £20 million of the capital gains.
On the rest of the money, he'd have benefitted from substantial shareholding exemption as he had set up a holding company and put other structures in place.
And about any capital gains that didn't benefit from all the tax reliefs etc - he could have used that loose change
Or he'd have created an EOT and paid no tax, absolutely zero tax, on the entire capital gains.
Your friend saved money after paying silly PAYE, Employer and Employee NI on part of his salary and dividend tax on the rest of the salary, and he invested it. That's what a lot of people who don't own a limited company do. Anybody can do that. It suggests he's frugal and conservative with his money, and he works hard in his job, not that he's a good businessman or that he has built a business.
At any point if he had died, his widow would have had as much luck selling the 'business' as the OP is having. I've seen that sad situation far too often - no succession plan = worthless and unsellable 'business'.
In posting this, I'm hoping to raise awareness among those who've built a job for themselves many of whom think that this is a viable pension plan and that one day they can sell their 'business' for mega bucks. They need to wake up and smell the coffee. What they THINK that acquirers want is very different to what acquirers actually want.
Take my advice or leave it but it's me out of this thread now.
Making comments about somebody who you know absolutely nothing about to support the notion that you have to make mega bucks and have management teams in place in order to qualify as a business.
When I next see him, I'll tell him he's been doing it wrong. That despite his house - I guess about £3.5m worth - portfolio of rental properties, building company and who knows how much in investments/banks, including freehold on the prime sites ( a few more £m) which form part of his 'job', that he could have done so much better than just picking up a salary.
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Nah that's just silly talk. A lot of waffle just like @Clinton trying to make some sort of point that makes no sense.
It's a business regardless of whether it's a good or bad, big or small, has employees or not etc
We can all argue if it's a good business or not, whether it's a business that is saleable or not, whether it's over valued etc. But to call it not a business is simply put, stupid.
The OP says they put 4 hours a day into it. They have created something from nothing, they have their own website, send products directly to clients, take payments directly, decide which products to sell, re-invest in stock. It's a business. What are we trying to achieve here?
The argument is clearly that the business is not big enough to be able to purchase and hire someone to replace the OP at this stage so you guys are calling it a job. That's a fair point but it still doesn't make it not a business. It's simply a business that you are not wanting to purchase because it's not at the point that you deem to be a good/scaleable business.
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I didn’t say it’s not a business. I just said should they wish to sell it it will be regarded as a job rather than investment.
Take your own business as an example. Should you choose to sell how important are you to the business. Would I need you to continue operations or do you have staff to do all the work?
Take your own business as an example. Should you choose to sell how important are you to the business. Would I need you to continue operations or do you have staff to do all the work?
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Please can we end this stupid and pointless argument and get back to the OP's issue.Where's your contribution?
Do you need a smaller ruler?
Lucan I have sent this in response to your post but it applies eqaully to all those who think it is worth arguing over whether a small business is a business or a job. Nobody but you lot cares.
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....and that's where Clinton's one size fits all view falls down...
Not every business that has a lot of input from the owner collapses when he/she is no more.
Small businesses get taken over by offspring, employees, others trading in the same arena.
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Which was my point. There is a huge range of business types and the valuation and pitch to sell the business will have just as much variety.
In the case of @DoolallyTap it’s at the bottom end of the range and his current valuation is way too high.
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- Original Poster
- #117
And, as I have repeated OVER AND OVER I am open to any sensible offer, suggestion or potential partnership, new ltd co. or any other workable way forward. Adding 3000 listings to eBay will almost double the turnover/profit overnight. With many other ideas there is tremendous scope for growth. A new Ltd company with a new shareholder possibly taking more than 51% and becoming the driving force would be fine by me. Moving into a small warehouse store would be nice, it only needs 300+ square feet at present.
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Whilst they may be tremendous scope for growth that’s not what someone is paying for. What they are paying for is the current business. Reduce the stock levels and valuation and you might find someone.
I was interested but I don’t want the stock as most of it won’t ever sell and I suspect you don’t have a license for the trademarked products. If you do then the value goes up.
I was interested but I don’t want the stock as most of it won’t ever sell and I suspect you don’t have a license for the trademarked products. If you do then the value goes up.
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Do it, then? You’re effectively asking for someone to pay a premium for them to do the work to double the business.
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Good grief, shame on some of the posters here insulting the OP.
The guy is 74 for crying out loud and looking to sell his mum and pop business. Ok it might not be for some of you, it might be a lifestyle business some don’t like fair enough but to respond with some of these posts is a total disgrace frankly, and now we have some ridiculous “Willy Waving” contest from two alpha posters trying to prove a point - knock it off, it’s embarrassing.
@DoolallyTap i hope you find a buyer to take over, conditions are tough at the moment and you may need to lower your expectations on stock at value and what you want for the goodwill but it’s a business someone might want to add to another retail shipping business they have if they have capacity and time to add. Good luck to you.
The guy is 74 for crying out loud and looking to sell his mum and pop business. Ok it might not be for some of you, it might be a lifestyle business some don’t like fair enough but to respond with some of these posts is a total disgrace frankly, and now we have some ridiculous “Willy Waving” contest from two alpha posters trying to prove a point - knock it off, it’s embarrassing.
@DoolallyTap i hope you find a buyer to take over, conditions are tough at the moment and you may need to lower your expectations on stock at value and what you want for the goodwill but it’s a business someone might want to add to another retail shipping business they have if they have capacity and time to add. Good luck to you.
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