Advice for the future of my company

[PCLTD]

Evening everyone,


I will try to keep this as short as possible but I am looking for some third party advice on what to do with my company, its something I have been thinking about for the last couple of weeks but cant get a clear answer in my head.

So to start with the company is a e-commerce set up within the sports industry, I have a small warehouse to hold some stock and for the business address but its not needed long term and is ran from home. Other than that there is no major out goings (no loans, credit or over drafts). I am the director and my fiance works with me.

The company was established seven years ago and we have worked with various suppliers to grow the company from a £1500 initial set up (no start up loans etc) to the point where we are turning over £350-400k. Being online we struggled to get accounts with some suppliers as we didn't have a physical shop but in the end had a good selection of premium & popular suppliers.
However recently one of these suppliers contacted us and said they can only sell to physical shops due to pressure from HQ and it has knocked up a bit, sales are still stable and nothing to worry about but if we want to continue to grow we will need a physical shop.
The problem is I also have other commitments and we dont have the time to be in a shop 9-5 through the week & weekends and taking on a full time employee while opening a shop is a gamble we dont want to take.

In short its left me with the following options:

1) Cash out the business and move on to my other projects - I think I will be able to sell the company quite easily and someone with the time can open a shop.

2) Bit of a wild idea but look at franchising the name so someone nationally can benefit from our work and we will essentially manage it (if thats the right word)

Benefits of the company if someone wanted to use our name & franchise it.
- We have established accounts with these suppliers are we on the elite pricing due to the amount of orders we process, this takes time to build up.
- We have established accounts with Worldpay, DPD, V12 finance and others. Again these are all on premiums levels so we get the lowest rates possible (excluding DPD but its pretty cheap).
- Established and regular customer base, 3000+ followers, 100% feedback on numerous sites and so on.
- We are in the process of getting a new fancy Magento 2 website. If someone wanted to franchise we can offer a click and collect service through the site so they can also benefit from the sales by getting customer in their shop. Collection is something we have never offer but often asked so its a good way for us to boost foot fall for a new shop. We have spent a lot of money in the last 6-8 months on the new site, upgrading finance providers and a lot of other back end stuff.

To be honest I wouldn't even know where to start with the above but I am looking for a way to pass the company on as I know there is huge potential, loads more variations of products we could sell and actually professionally market it which is something we have never done.

What do you all think?
Can you even franchise (if thats the right word) an online company?
Is it worth the hassle and would we even be needed, how would we get paid?

Or is it worth advertising the company, selling stock, withdrawing cash and walking away with a lump sum to boost my other project?

Any help appreciated, I am open to other options and willing to listen.

Thanks!

 

[Mr D]

Selling quite easily - maybe, maybe not. A chunk of those who put their business for sale appear to still be selling it a year or two later. And buying price may not be what you want as a seller.
Some businesses do sell quickly. Within a few months.
Not seen many though, one I do know was seriously undervalued (owner's grand-niece sold it on).


Franchising - it does not sound like its worth it. A lot of work to be able to franchise, creating a business that can be replicated easily with established procedures, stock, training, branding etc. Does not sound like you are close to being able to do that. It can be done, just not sure you could do it yet.


Benefits - that sounds like what a buyer of the company may want to know. When you say followers - followers on social media? Untransferrable social media?

Every company has huge potential, its included in a lot of selling details. Meaningless to a buyer, obviously means a lot to sellers who aren't utilising it.

 

[PCLTD]

Thanks for the info.

I appreciate selling the company isn't straight forward. I would like it sold within a year if I went down the route but know it can take longer.

In regards to potential I imagine this is something which gets thrown a round a lot with company sales but we genuinely do. To be more open we are an online cycle shop but we specialise in the sale of just high specification mountain bikes. There is potential for the new owner to sell road bikes, lower end bikes (sub £700) and children's bikes. We also only sell high value accessories and parts so again there is potential to sell lower end stuff such as tyres, handlebars etc etc.

The reason we only deal with higher end stuff is due to time, it works for us as its lower turn over of sales but higher profit. If someone was to open a shop they would benefit from our customers (higher end) but also open up the above market. As you will know road cycling is big business at the moment.

Followers are on social media. These are genuine followers we have built up and not bought. We get lots of comments and interaction on posts and products. We also have a community group with over 600 members which is used for private sales and 'online socialising'. Its a good genuine following.

 

[Clinton]

<sigh> Here we go again.

No, you can't franchise. Having one operation making a tiny profit is not a basis for franchising. I don't know where you micro businesses get these fancy ideas! If I've heard it once, I've heard it a hundred times - from every guy who owns a mobile cafe or ice cream van to the bloke down at the local market who runs a stall selling jewellery tat. They all think they can franchise their operation.

Open multiple outlets, demonstrate they can operate as independent profit centres, then bung £100K+ into all the legals, forms, processes, procedures, dispute resolution mechanisms, branding etc. Then spend another £100K or so in marketing to sell the idea to punters. No, you can't spend £23.47 in marketing and expect to sell £20K franchises!

Spend all that money and, bingo, you've got a franchise.

In regards to potential I imagine this is something which gets thrown a round a lot with company sales but we genuinely do. To be more open we are an online cycle shop but we specialise in the sale of just high specification mountain bikes. There is potential for the new owner to sell road bikes, lower end bikes (sub £700) and children's bikes. We also only sell high value accessories and parts so again there is potential to sell lower end stuff such as tyres, handlebars etc etc.

It would take an idiot to pay you for this "potential" and while it's not impossible to find idiots ...expect to pay at least a few tens of thousands to find one dumb investor who has more money than sense and willing to base his offer on the "potential" you see in your business. I have more thoughts on potential here.

I would have given some constructive suggestions but you are so carried away with all this completely unrealistic nonsense about potential that there just doesn't seem to be any point.

 

[MOIC]

Persevere with what you are doing.

Suppliers come and go. There are many.

Start developing your own brand and push this for the next few years.

 

[PCLTD]

In regards to Clintons response - Was that really necessary?

I didn't come here being big headed thinking I was going to become a millionaire franchise expert. I openly admitted I had no idea if this could be done but would be considered if viable. I found out from reply number 1 that it was unlikely and wasn't made to feel an idiot.

I also didn't come here to be mocked and belittled as a 'micro business' owner making a 'tiny' profit who is carried away with my plan. In regards to value I have no idea whats its worth but will be realistic in my expectations, its not going to be life changing money but hopefully enough for a bit of a cash injection to my new project.

Your reply was completely pointless and rude, you have wasted my time and yours and at the end of it came across as some one extremely negative and unprofessional in front of like minded business owners. Considering you are someone who sells companies reading that would put me off.

You also dont know anything about my self or my finances. This is one company I run and I invest heavily within property where I will be using the proceeds of this company to expand my portfolio and developer other properties. I dont expect to be talked down to like I am a child when I am seeking genuine advice.

 

[Clinton]

Good luck. I'm out.

<Added: Before I get a flood of DMs - no, I don't sell companies!>

 

[billybob99]

In regards to Clintons response - Was that really necessary?

It's part of the package.

Think of it as a meal deal.

 

[PCLTD]

Thank god your out, move on to the next one now.

Hopefully some genuine helpful advice from fellow members to follow.

 

[Mr D]

Thanks for the info.

I appreciate selling the company isn't straight forward. I would like it sold within a year if I went down the route but know it can take longer.

In regards to potential I imagine this is something which gets thrown a round a lot with company sales but we genuinely do. To be more open we are an online cycle shop but we specialise in the sale of just high specification mountain bikes. There is potential for the new owner to sell road bikes, lower end bikes (sub £700) and children's bikes. We also only sell high value accessories and parts so again there is potential to sell lower end stuff such as tyres, handlebars etc etc.

The reason we only deal with higher end stuff is due to time, it works for us as its lower turn over of sales but higher profit. If someone was to open a shop they would benefit from our customers (higher end) but also open up the above market. As you will know road cycling is big business at the moment.

Followers are on social media. These are genuine followers we have built up and not bought. We get lots of comments and interaction on posts and products. We also have a community group with over 600 members which is used for private sales and 'online socialising'. Its a good genuine following.

So a high end online shop rather than across the board or budget for the type of goods.
It's a niche and by the sound of it works pretty well so far.

More than some businesses ever manage to achieve.

Just be aware that selling, the agreed price may not be close to the advertised price. Some people
can take a business and take it to the next level - as you say adding a bricks and mortar shop, adding lower price level etc.
Or maybe some other business able to bolt a business onto theirs by acquisition.

Hope it works out for you.

 

[MOIC]

I imagine that a bricks and mortar shop will actually help your business, as customers will be able to try, test and feel products before purchasing.

It can be in a secondary position, or on an industrial estate which can also be your warehouse and hub.

If you are in to property, buy an investment to trade from.

Add your own brand of cycling clothing and shoes.

It’s a rapidly growing industry!

 

[kulture]

I actually think that Clinton's advice was good, if a bit abrupt. This is not a franchise oportunity. You should perhaps consider a third option. What is a shop? What is stopping you opening one by appointment only? It would be a place to store stock, and a place to set up and adjust bikes when/if someone makes an appointment. It does not have to be in a prime location. Indeed you could combine it with your warehouse if the location is suitable.

No supplier is going to check your opening hours. It could be an added product to sell the service of a personal adjustment and set up of a new quality bike.

 

[The Byre]

Any help appreciated, I am open to other options and willing to listen.

But not willing to listen to @Cinton's sobering bucket of cold water?

OK, here's my common-sense approach -

Rule One in Life - BS beats brains. Never forget that rule!

You said it yourself -

one of these suppliers contacted us and said they can only sell to physical shops due to pressure from HQ

And there's your answer!

Make your warehouse into a shop of sorts and get the rep to come round, place a nice order with them to satisfy all concerned and that's all they want. They need to have seen a full-time shop, but they only want to see the damn thing once!

Back in 1979 I opened a music shop in Germany and bought stuff from Europe's second-largest MI wholesaler at the time after Yamaha, Music Meyer. After a year, I moved the shop and continued to buy from them. Then I closed the shop entirely but continued to buy from them. I only ever saw the rep once at the original shop.

The World's largest musical instrument retailer is a relatively small village shop in South Germany. It employs now some 1,600 staff and even has robotic package processing. What OTC sales they have are really just a spin-off of the online shop - people coming in just to see the B&M behind this large operation!

Scan Computers has a small showroom that is fairly quiet and hardly sees many customers toddling about the place. More often than not, an abbey-like silence reigns, punctuated only by staff talking to themselves on headsets. Maybe 100 sq m and about three or four attendants who have other duties. But they will have a turnover of about £150m this year and a staff of about 280. That's a turnover of nearly £600k for every working day - or nearly £66k per hour.

 

[TheoNe]

As a small business owner myself, you have done exceptionally well starting with just £1500 to the point where you are turning over a healthy £400K! In my opinion, you should took for a buyer at this point & plug the money into your other project - which seems to excite you.

I hope this helps.

 

[PCLTD]

Thanks for the feedback guys. It took some time building the company up and I am confident the figures could double quite quickly in the right hands.

Just to make it clear I never came on here with the intention of franchising it or thinking it was some top end company I can sell and retire on a yacht somewhere. I am realistic and understand at the end of the day its a website, suppliers and a customer base. In the grand scheme of things its not worth huge money but I was throwing ideas around my head and just wanted to bounce them off some people.

In regards to the shop, suppliers in this industry and stupidly picky. To get an account with most you have to show opening hours, interior photos where the workshop will be, advertising space, stock a certain amount of products from low end to high end with everything in the middle and much more. Reps are always in the area and pop in every now and then for a chat and to keep up to date. I know a couple of guys locally who have shops and this is how they work, for me it would just would be a hinderance and from what I see in the other shops there empty 80% of the day so either myself or a paid employee would need to be there.

In my opinion online is the way forward for this industry.

Last year when I initially started thinking about long term plans I put a very brief advert on a free classified site and had a few companies get in touch, they were all similar in terms of industry. Basically out door style shops and it seemed like they wanted to add a cycling sector without the hassle. Perhaps this will be the best route.

As mentioned I haven't really looked in to this properly and will need to speak to some brokers, get a valuation and plan what I am going to do.

Thanks again for the advice

 

[PCLTD]

I imagine that a bricks and mortar shop will actually help your business, as customers will be able to try, test and feel products before purchasing.

It can be in a secondary position, or on an industrial estate which can also be your warehouse and hub.

If you are in to property, buy an investment to trade from.

Add your own brand of cycling clothing and shoes.

It’s a rapidly growing industry!

Starting my own brand with components would be the way forward & something I would like to do. However it would be a new company and it takes time to build this customer base up plus not an easy task designing them and finding a reliable company to manufacture the products.

 

[Financial-Modeller]

Why not buy a shop unit (personally, via your pension or PropCo) and lease it to your e-commerce company, then get somebody to run it on a profit-share basis, perhaps with the manager incentivised to buy shares from profits?

You have the means/structure to do so:

... and I invest heavily within property where I will be using the proceeds of this company to expand my portfolio and developer other properties...

And you know people who could run it for you:

...I know a couple of guys locally who have shops...

The transfer might take more than your 12-month suggestion, but this would enable you to step down from day-to-day responsibility, receive an income until the sale is complete, and retain a residual rental income per the Property model that you are moving towards.

 

[PCLTD]

Thanks for the input.

I did look in to buying the unit we currently lease but there was a few of problems (which can be overcome):

1 - The purchase price was too low so I would have to put it part cash and part long term loan which isn't ideal.

2 - If we purchased the unit there was a few jobs which need doing, at the moment the electricity is ran from a pay as you go meter in the unit, its fine for us as we just use it for storage and an address so rarely there and usually just put a few pound coins in now and then but if it was a shop and was purchased it we would need to get a proper meter put in which will be a few thousand I would imagine as the current industrial meter feeding the units its about 20m away over the road.

3 - The money I was going to use as a deposit on the unit mortgage would be better spent on a residential BTL property for a higher yield. Its not to say I wouldn't buy the unit and do the above but I would need a solid plan before putting money in to the above as it wont come cheap. Failing that I could look elsewhere for a unit as we can work from anywhere to be honest, we dont need to be in this location/town.

 

[Financial-Modeller]

At the risk of going off topic, you seem to finding problems rather than solutions.

Responding to your points in order:

1. too low? surely most property is purchased with a combination of cash and debt - unsure what you mean?

2. reflect the cost of upgrading the meter in your offer price.

3. structure the lease (you will effectively be in the unique position of being on both sides of the agreement) to provide the net risk-adjusted return that you want. This could be above or below the target net return from residential BTL, and might provide a return that is less-closely-correllated to a BTL portfolio.

In any case, why buy the space that you currently lease if (as you say in your first post) its currently not needed? Buy a space that is fit for the purpose of running the business going forward; perhaps in consultation from your new manager. There might even be a deal to be done buying premises that your new manager currently occupies or aspires to occupy.

 

[MOIC]

Starting my own brand with components would be the way forward & something I would like to do. However it would be a new company and it takes time to build this customer base up plus not an easy task designing them and finding a reliable company to manufacture the products.

Start with accessories:

Cycling clothing

Cycling Shoes

Helmets

Water rucksacks

LED rucksacks

Stainless Steel water bottles

Fingerprint Locks

Phone holders

Bike bags

The list is endless . . . .

Start with one product with your brand.

 

[PCLTD]

Sorry I should have made it clearer.

So the purchase price (with negotiation) would be around £37,500.
On most commercial BTL you need a minimum purchase price of £50,000 so a standard mortgage would be unlikely/unfavourable. The only way I could buy that unit would be to put down a similar deposit (25%) and then get a loan for the remaining. The only problem is that loan for the unit might affect my future residential BTL. It might be possible but I would need to look carefully through it.

I do like your idea though, I think this is kind of what I had in my head but worded it as a 'franchise'. For me it would be ideal if I could input and manage the online side of things while someone else runs the shop and we build the company as a whole. As you said it gives me more time but still a wage and foot in the company.

Not something I have looked in to but if I went down that route would the new person become a director? I cant see someone wanting to do the above for just a profit share when its going to be slightly unknown for the foreseeable while we get a shop up and running.
Also if someone did the above would they 'buy in' to the company or could I ask them to fund the shop, fitting etc as a buy in?

Sorry if this sounds daft but its completely new to me. If you or anyone you know has done a similar thing I am happy to pay for your time and have a chat to run through a scenario on how it would work.

Thanks again

 

[BusterBloodvessel]

I work in the automotive industry and a lot of independent car parts & spares retailers now deal in cycles also. It's a strange direction but Halfords started it and everyone else has followed suit! That said it works well for every retailer I know that does it, it's now a big chunk of their income.

How about approaching a local car spares shop, if you have one, and looking to sublet a small corner of their shop and operate as "Your Name @ Their Name" ("The Cycle Centre @ Jims Car Parts" sort of thing).

You could then I think consider different ways of making it work for you which could be ;

1. You instantly have your click and collect point.

2. You use it as a "full" showroom with all your high end stock etc and either you are there or you staff it with somebody else. However one advantage could be that you could open less hours than the shop itself if it as run as a shop within a shop.

3. You could have it as a more basic spares centre for regular maintenance / add on stuff (I guess that's tyres, inner tubes, helmets, water bottles etc?). You could staff this with a low paid worker OR the car parts shop could simply cover this for you with some training on these presumably simpler products?

4. You could be available by appointment only for people wanting to spec up and view the serious high end stuff.

Or some combination of the above to make it work for you.

I am thinking that would get you the retail presence you need in a fully open store 6 or 7 days a week, keeping you access to your suppliers. The retailer you sublet from gets a little extra income and they benefit from extra footfall, AND potentially extra sales for them if you run it some way like in point 3 where they take care of the sales and take a commission.

Just a thought...

 

[BTON Agency]

Can you not game the system, get the cheapest shop front you can, load the window with branding for your website and just not staff it?

 

[ComPropSolicitor]

Unless I am very mistaken, (1) your are being held back by not having a premises, (2) you have a portfolio of properties. Surely the solution is to buy a small shop that you can rent out if this does ever go wrong or sell. In the interim you can trade from it and suspect you would only have to employ one or two people.

If you are turning over 400k and don't have profits to pay for some staff to run a shop something is going wrong somewhere.

 

[PCLTD]

I have seen a few car parts companies doing this online (mainly ads on Facebook) and they seem to stock e-bikes which are a strong market and gradually taking over. I guess although it's a 'bicycle' the motor aspect of it kind of works with their market. We are lucky as we are on elite + pricing with one retailer who also distribute two of the most popular brand e-bikes (this covers e-mountainbike, road and city) so if someone wanted to go down that route they have a very strong start. You can also then offer the Cycle 2 Work scheme which will help.

In terms of buying a shop and then leaving it unmanned wouldn't really work. A lot of the suppliers have reps in the area so to set up an account they often come in the shop and talk face to face. It would mean having to do out a shop, add a workshop area, carpeting etc etc then just leave it. It would also run the risk of theft as people will eventually click on its not manned but holds a load of high end bikes. I have no problem investing in a shop front as a investment like any other property but it would have to be the right one.

Regarding an employee, I can afford to pay someone but its wasted money and I dont have the time to be there all hours which I think eventually will look unprofessional if people see a shop front and visit a few times but its always shut, I can only see that heading to bad reviews.
I pay my self a good wage from this company and my fiance works with me, as everything is online I imagine the shop will rarely get used which means I am paying someone to stand about all day in the hope the odd customer walks in and buys or wants to collect.

It's a tricky situation to be in and I appreciate all the feedback. Hopefully I can get my head around all ideas and put a plan in place.

 

[JamieM]

How much of your sales are attributed to this one supplier? Is it a one brand supplier?

 

[Socio South West]

As mentioned I haven't really looked in to this properly and will need to speak to some brokers, get a valuation and plan what I am going to do.

As @Clinton is out... It doesn't matter a tinker's toss what a broker says a business is worth: Very often tending towards always their multiplication factors on Gross Profit result in wildly over inflated asking prices.

A business is worth what someone will pay for it: A competitor is always a good way to dispose of a business as there are always those looking to expand: You may find a cycle shop who is looking to develop an online presence.

The problem is you have a delightful pair of rose tinted specs on and you are asking someone to invest in the 'potential' - The business has the potential to crash and burn as much as it does to soar as you are envisaging: Your buyer is investing in risk..... and you are already admitting that suppliers are inspecting their own posteriors with ever increasing frequency.

Cycling is a buzz word and a well grown bubble at the moment- Where was it 15 years ago? Where will it be in 15 years time? It would be a good time to market the business certainly, and you might be surprised how nice it feels to have some free time again.

Think about the ease with which an online business can be set up - really all you are selling is your online presence plus the advantage of having the Google spiders crawling all over your site for a few years +SAV

 

[Pish_Pash]

In short its left me with the following options:

1) Cash out the business and move on to my other projects - I think I will be able to sell the company quite easily and someone with the time can open a shop.
!

It looks to me that you' have the problem that most other business of this size have when they wish to exit ....too small to be of acquiring interest to the big players ...and a likely asking price too large for most entrepreneurial one man bands (who'd be your target buyer market). Also, you have no USP (no brand) to make yours of special interest ...in essence you're an online retailer...like any other online retailer (and there are hundreds of thousands of those)

If you remove yourself from the business...there probably isn't much of a business left ...in other words you are the business.

In your opening post, you mention tunrover...in isolation, it means squat...what's your net profit?

 

[MBE2017]

A few years ago I was given the same attitude by lighting suppliers, only happy to supply B&M shops, to avoid internet only companies undercutting the B&M’s.

I went to the largest show and managed to get to talk to the various sales directors, and proved to them how the only people cutting their prices on the web, were their current B&M shops.

End result I walked out of the exhibition with three new accounts opened up, the first e-commerce only account those companies had. I simply argued it was going to happen and they could either embrace the change, or die.

Maybe you should try to argue your case a bit harder, I doubt they will want to lose the orders, and who knows how good a replacement supplier might be in the long run.

Best of luck.

 

[Mr D]

A few years ago I was given the same attitude by lighting suppliers, only happy to supply B&M shops, to avoid internet only companies undercutting the B&M’s.

I went to the largest show and managed to get to talk to the various sales directors, and proved to them how the only people cutting their prices on the web, were their current B&M shops.

End result I walked out of the exhibition with three new accounts opened up, the first e-commerce only account those companies had. I simply argued it was going to happen and they could either embrace the change, or die.

Maybe you should try to argue your case a bit harder, I doubt they will want to lose the orders, and who knows how good a replacement supplier might be in the long run.

Best of luck.

Some of the big name brands in other areas of business still argue that they won't devalue the brand by letting internet-only sellers trade.
A number won't touch ebay & amazon now. Sell on there and they get onto the sites and have the account pulled.

 

[MOIC]

A number won't touch ebay & amazon now.

Ebay & Amazon (only) sellers are different to bona fide online sellers with their own website and who are not involved with selling their brand (or other brands) on these 2 platforms.

Whether they are losing out by not selling on Amazon, is a different matter.

 

[Mr D]

Ebay & Amazon (only) sellers are different to bona fide online sellers with their own website and who are not involved with selling their brand (or other brands) on these 2 platforms.

Whether they are losing out by not selling on Amazon, is a different matter.

We are still online only sellers. Just we use a particular site.
If someone is going to compete with the offline stores, undercut, devalue etc they can do so just with their own website too.
The policy of the internet business is the issue in behaviour, not the particular site they happen to sell on.

 

[MOIC]

We are still online only sellers.

There is a distinct difference.

Having your own website shows the supplier your company full details, about your company, products sold, price points and generally your overall business concept.

A seller on eBay, Amazon etc can be a 'seller of all things' and just looking to make a profit and move on to another line or product as and when it suits them.

The above 2 are very different business categories.

I agree that some online sellers who have their own website also sell on Amazon etc, but they will generally be protecting their prices as much as possible and will not get involved with 'the race to the bottom'.

Suppliers will not want to sell to the latter due to their (probable) business ethics.

 

[Mr D]

There is a distinct difference.

Having your own website shows the supplier your company full details, about your company, products sold, price points and generally your overall business concept.

A seller on eBay, Amazon etc can be a 'seller of all things' and just looking to make a profit and move on to another line or product as and when it suits them.

The above 2 are very different business categories.

I agree that some online sellers who have their own website also sell on Amazon etc, but they will generally be protecting their prices as much as possible and will not get involved with 'the race to the bottom'.

Suppliers will not want to sell to the latter due to their (probable) business ethics.

As a seller of all things I think I know what I am about, thank you. We can also sell on our own websites that way. The business determines what it does, not the 3rd party site.

Have had websites while also selling on ebay and amazon. Business was the same on all sites.
Quite a number of online sellers have both 3rd party sites and own website for selling. Its been pretty common for well over a decade now.

Protect your prices, don't protect your prices. Same decision making process whether competing with other sellers on a site or other sellers on other sites.

I want to sell a £5 item on my own site that is also available cheaper on 3 or 4 third party sites and dozens of other seller websites at various prices then I have competition. Decisions on how to sell do not rely on what other sites exist.

 

[tony84]

Why not buy a shop with a 1-3 year lease left on it?
Put a sign up and then tell the wholesalers you have a shop. Once you have accounts with them are they really going to check up on you? Open it for a couple of months, if it is not paying for itself, close it down.

 

[MOIC]

As a seller of all things I think I know what I am about, thank you. We can also sell on our own websites that way. The business determines what it does, not the 3rd party site.

Have had websites while also selling on ebay and amazon. Business was the same on all sites.
Quite a number of online sellers have both 3rd party sites and own website for selling. Its been pretty common for well over a decade now.

Protect your prices, don't protect your prices. Same decision making process whether competing with other sellers on a site or other sellers on other sites.

I want to sell a £5 item on my own site that is also available cheaper on 3 or 4 third party sites and dozens of other seller websites at various prices then I have competition. Decisions on how to sell do not rely on what other sites exist.

It's good we have slightly different views. . . . . .it makes for interesting debate!

 

[Financial-Modeller]

Sorry I should have made it clearer.

So the purchase price (with negotiation) would be around £37,500.
On most commercial BTL you need a minimum purchase price of £50,000 so a standard mortgage would be unlikely/unfavourable. The only way I could buy that unit would be to put down a similar deposit (25%) and then get a loan for the remaining. The only problem is that loan for the unit might affect my future residential BTL. It might be possible but I would need to look carefully through it.

Thanks - now I understand.

I think there are two separate and distinct issues here.
1. disposal of your company
2. future residential BTL investment

Your post suggests that the latter is dependent on the former, but as many on here have suggested, the value of the former may not (given the info provided) be sufficient for the latter.

I do like your idea though, I think this is kind of what I had in my head but worded it as a 'franchise'. For me it would be ideal if I could input and manage the online side of things while someone else runs the shop and we build the company as a whole. As you said it gives me more time but still a wage and foot in the company.

So perhaps postpone the resi BTL idea, whilst you wind down the stake in the business AND retain the income from the shop unit.

Not something I have looked in to but if I went down that route would the new person become a director? I cant see someone wanting to do the above for just a profit share when its going to be slightly unknown for the foreseeable while we get a shop up and running.
Also if someone did the above would they 'buy in' to the company or could I ask them to fund the shop, fitting etc as a buy in?

Anything is possible, subject to negotiation.

Sorry if this sounds daft but its completely new to me. If you or anyone you know has done a similar thing I am happy to pay for your time and have a chat to run through a scenario on how it would work.

Not sure that I can add significant value over and above what I've suggested, but happy for you to PM me to discuss privately in more detail. My post yesterday in the Marketplace on here might be of interest - no charge!

Thanks again

You're welcome.

 

[MarkHenry19]

Helpful stuff!