Two car washes generating $1.9M in revenue and $820K profit are listed for $7.9M. Mike Andes breaks down why the math fails: you could build the same thing for under $3M, and SBA financing would cost $1.06M annually, eating into profits.
$1.9 million
$820,000 per year
$7.9 million
Less than $3 million
10% down, 9% interest rate
This person is selling two car wash locations with a revenues of $1.9 million, but I don't think it's a good deal, even though they make $820,000 in profit every single year. Why? Because they're asking $7.9 million for two car washes that you could probably build out from scratch for less than 3 million. You got to ask yourself how much would it cost to just build the company from scratch and then pay marketing and advertising cost to get the customer base they already have? Also, if you buy these car washes with a SBA loan and you put 10% down, 9% interest rate, you're going to literally be spending $1.06 million in payments, which is more than what they're currently profiting from these locations.
