EP1: Buying a UPS Store

Now this is so welcome to. Welcome to episode one. First time doing a podcast. So thank you, Pace Morby, for giving me the gentle nudge to go ahead and get started. So I have a special guest today. I have Lindsay Ellenwood, who is practically famous now because Pace mentioned her on a zoom the other week about how she's buying a UPS store. So really excited to have her on today and hear about that experience. You know, this kind of fits in with what I'm doing here. My channel specifically talking about businesses, how to scale and even how to silently exit them. So really excited to hear what she has to say.

Apparently my. My dog wants to do all the talking for me, so give me just one second. He's been. Okay, this is the second time today he's done this to me. So he's been silent until I get on camera.

Oh, it's all good because I just lost my audio.

I was going to say you're. I hear you, but I don't see you.

I'll just switch over to my computer here. Like a podcast are new, but I think my video. My camera died.

Oh, no.

So tell me about. While I fiddle around with this, tell me about yourself and how you got started with this.

Yeah. So I have a corporate sales background. I did business to business sales for five years and each time I was with two different companies primarily. And the first time I was laid off from a company restructure and then they brought me back on and then I left that position a little over a year ago and then I went to. I was recruited to a software company and started doing software sales. And then six months into that gig, they also did a company restructure and I was laid off again. But you know what? It worked out because I always wanted to buy a business and I just never really knew how or what that even looked like for me. And so in December this, during this last layoff, I had two options. I mean, they gave me another option to take a different position and stay with the company or my other option was take the capital that I got from selling my house almost two years ago and actually pursue this business dream that I've had. So, um, yeah, so that's. Thank you. Yeah, it's, it's. It was a big leap of faith I had to take. But I just kept telling myself that every time I've gotten laid off, I've, I've pursued something totally unexpected and totally different and it's always worked out better. So I had that to lean on.

And yeah, that's that's amazing. Yeah. If I think about every. At the time what I felt like was a low point or every, you know, really negative thing that's ever happened to me, it actually turned out to be, you know, one of the biggest blessings.

Absolutely.

And I'm sure that's gonna happen for you.

I feel fortunate that I've went. I went through all of it because, you know, there were other team members of mine that were freaking out, and they were just completely beside themselves. And I'm like, I. I just was. I was trying to be reassuring because I'm like, everything's gonna work out. It's gonna be better for you. And. And sure enough, it. It was so blur my background, so my little annoying dog doesn't get distracted.

Well, I got my cat scratching, so it's all good.

Oh, my gosh, he's getting the zoomies right now, so this is his time, so. But yeah, it just. Basically, it was funny. I. I met my boyfriend about two years ago, and our first date, we were talking about, you know, ourselves, and we both like to read, and we were both reading the book called Buy then Build. Actually, probably wish I could just rattle off the author, but it's on this bookshelf next to me here. But basically, it's a book that is exactly that. It talks about buying businesses, existing businesses, and figuring out how to build and scale them. So. One sec. Sorry. So it's almost like having small children. So, yeah, I, you know, I started there and it brought me to trying to figure out what kind of business I should be looking for, and started doing some research, started watching some YouTube videos that actually had pace with Carl Allen. I don't know if you've ever heard of him, but they were basically talking about buying businesses with no money out of your pocket. And I was like, well, I have no idea how to do that, but that sounds like really cool thing. But I was like, I'll figure that out after I get my first business under my belt. Because I just, you know, it was a desperation kind of thing, and I was like, I've got to find a business now, you know, so. So, yeah, it's kind of really what brought me to being. Beginning to have interest in buying a business, if you will.

I feel like that's not a logical thought process of a normal person to. To, you know, kind of leave more of a traditional work environment and like, okay, I need to go start a business. And I. I know you mentioned offline that you're training for an iron man, so I. Sounds like, you definitely have the mental fortitude to succeed in. In business, which is, you know, that's awesome. Hats off to you.

Thank you. And, yeah, I mean, you can see behind me there's. That's my bike. I'm.

I'm in the process of training, pedaling right now.

Yeah, I know. I, like, sit on my bike and just watch pace videos. That's literally my stuff. Story of my life these days.

Nice. Very good.

No, yeah, it. Honestly, the. The whole Iron man situation started about June of last year, and I'd never done a triathlon before, and I'd always wanted to do one. I was a swimmer growing up and. Or a diver growing up. I wasn't even a swimmer, but I was comfortable with being in the water. And then during COVID I started running, and I'd always kind of been a biker, not to the extent that I am now. And so I did my first full Ironman in November last year, and it was the second triathlon I've ever done. So once I went through that, it was. It was definitely. I. I mean, I don't say I was in a low place of my life, but it just. It gave me a lot of structure that I was craving and that I needed to. I guess it filled a void, if you will, but it was a good void. So I went through that, and it did just what you said. It helped me build so much mental fortitude. And there's just. Anytime I come to a challenge nowadays, I'm like, you can literally figure out how to get through this. And if something pushes resistance, resistance. Their faces. I face resistance. I just sit and I think, you know, what is it that I need to be educating myself on to get past this resistance, to make myself not have anxiety about this or to get anxious about this and to keep moving forward.

That's very cool.

Yeah. So thank you for saying that. I appreciate it.

Yeah, no, I used to do CrossFit. I actually herniated my. My disc doing CrossFit, so I don't do it anymore. But when I used to do it, there was a lot of transferable skills and just that. That crossed over into, you know, really just business and in life, you know, for, you know, just thinking about the CrossFit methodology was about working on your weaknesses and getting better every day and how that, you know, how you translate that into businesses. You know, if you have skill gaps, you know, as a small entrepreneur, you're wearing 200 different hats, right? And, yeah, you may only know how to wear three of them. So you have to go figure out the other 197 or find somebody else.

That knows them that you.

Exactly. Yeah, exactly. And just, you know, working together as a team team and just filling in those gaps, I think are definitely some huge lessons I've learned from my time doing that.

100 agree.

So tell me about the, the UPS deal specifically.

Yeah.

Did you. So you've already bought this already?

So I'll be closing at the end of September.

Nice, nice. So, I mean, I'm sure you signed an NDA, so, you know, feel free to kind of pull back on what you can and can't share. But I would love to hear about, you know, just how that started. I know you said you just got to find a business. What did that look like? Did you just go on like bizbuysell.com and start searching, you know, businesses in your area?

Yeah. So. Good question. I. I'd been on Biz by Sell for about a year, just, you know, haphazardly scrolling, looking, seeing what was in certain areas. I didn't really have a buy box at that point and so I spent a lot of time just kind of trying to figure that out. And my boyfriend also owns, he owns three Boost Mobile stores. So I've had, you know, we've working alongside each other. He's. I don't want to say like he has been a mentor, but he's also been like, you need to just like, you'll find something when you, you'll find something and then it'll just make sense. And so in my mind, I'm always. Which for me, I'm a very attacker. Like I'm. I'm gonna go and get something done. If I want to get it done. It like it needs to happen like yesterday kind of thing. So for me to just kind of wait around for it, I got. Was getting super anxious about it. And then finally when the whole job thing happened, I was like, all right, now this is my time to actually focus and hone in on this. So I started with Biz by Sell. The hard part was when, when we first started looking. My boyfriend's a commercial airline pilot and he can pretty much live wherever, but we knew that we wanted to move. Um, we just didn't know where exactly. And so that made it kind of really challenging because I was like, well, there's this here and then there's that there. And it just made a lot, a lot of variables kind of come into play. And then finally I stumbled across ups. I was actually getting. I was at a physical Therapy appointment. And I was talking to my physical therapist about it and they're like, I was talking about buying a pack and ship and they're like, oh, one of our clients owns a UPS store or a couple UPS stores. And I was like, really? And so I was like, can you not directly give me her information and not break any HIPAA violations? And they're like, well, I'll tell you what store she works at. And so I, I tracked her down and I was like, hey, I'm thinking about buying one of these stores. I'd love to pick your brain. And she gave me the weirdest response. First of all, it was really bad because I got her name wrong and so she corrected me. And then I just was like, oh gosh, this is really awkward because she tried to refer me to like the area broker for ups. And I was like, that's not quite what I was trying to get at. So I was like, all right, on to the next one. So I just started digging into UPS's website, their franchise page, and kind of looking into what that looks like. And they actually have a lot of resources and a lot of different videos from owners on there. And I started picking out some of the owners that I could see that I identified with and what they had done with their business and what they liked most about the business. I was like, yes, that's what I would be, that's the position I would be in too. So I actually reached out to those owners and thank you. Yeah, and talk to them. And once I talked to them, I was like, all right, yeah, this is, this is where I need to be kind of thing. And in my process of looking for businesses, my goal was to find something that I didn't have to operate full time. You know, my first year to two years, I do plan on being very hands on, but after that I want it to be something that I have a manager in place. So I wanted the store to have a manager, wanted it to cash flow at least $120,000. And then obviously there were certain areas that I was looking in. And then I also wanted something that I could use my outside business to business skills in. So when looking at a UPS store, there's five different profit centers and one of them being print services. Most of the UPS stores now are not doing very much business in this area because the owners are either older and they don't know how to use different software to, you know, make the print stuff happen, or they just don't know how to go out and get the Business, and they just take whatever business comes into them. So the profit margin in the print sector is like 65% on average. So to me, I. Yeah, I looked at that, and I was like, there's a lot of opportunity there. And I know everyone thinks that print is dying. Everything's going digital, but the print industry is actually growing. It's kind of crazy. So. So that was kind of like, my main goal because I actually had gone and looked at Minuteman Press stores, and I told the Minuteman guy, I was like, yeah, I'm looking at ups. And he's like, oh, I've got UPS owners that are wanting to leave UPS and come on Minuteman stor. I'm like, oh, really? That's interesting. Why is that? And, sorry. My dog is now choosing to get into something new he's never done before. So I was like, oh. And, you know, he toured. We toured a couple different stores. Oh, my gosh. He's now playing with the doorstop. I'm so sorry.

You're good.

I'm telling you, he's a puppy. He's like a small child.

Oh, I feel. You had to test the power of my microphone and drowning out noise because, you know, my two toddlers, and they're screaming in the. Well, one of them was screaming in the background. And then my cat's a, you know, clawing on the door, so.

Oh, I can't hear anything.

See, there you go. Awesome.

Yeah. How was mine?

Pretty good.

Did you hear him when you just did that?

Oh, yeah, I heard that a little bit. Yeah.

That was pretty loud, though.

Yeah, that was loud.

We tweaked the settings a little bit, but I still have no idea. My boyfriend was like, do this and then this, and I'm like, I have no idea what that does. So.

I had no idea how sophisticated all this setup stuff was. Obviously, I couldn't even figure my camera because it died, but. But, yeah, I mean, it's just. I've spent the past, like, week and a half just learning, like, audio and, like.

Yeah.

And I was just like. I thought it was just plug and play.

Right? You would. Yeah. I'm like, this microphone stand, my desk, I can't clamp anything to it, so we have to have a stand, and it's just the most awkward thing. I'm like, it works for where it is now, but then every time I don't want to use it, I have to basically discombobulate my entire desk. So it's funny, but you, you know.

I think, you know, obviously, you And I come from PACE Mortgage and a lot of times it's a, you know, traditional transaction, 30 day close, you know, sometimes maybe 45 days if there's some title delays. Yeah, I think people might be surprised at the time period. I would assume, just from, you know, listening to what you're saying as far as, you know, doing your due diligence and talking to owners. I mean, it's not probably going to happen in 30 days. How long have you been working on this?

I'm so glad that you bring that up because. So, yeah, I started this in January and I was hoping that it would take at most three months. And here we are nine months later and I'm still not closed. So. Yeah, it's been a process.

Oh yeah. I worked on a. We were looking at an acquisition of a company. So I'm a CFO of a trucking company and we were going to acquire another trucking company. And I spent six months, you know, obviously we have a team of people helping, but just me specifically, I was kind of the one spending like my full dedicated time to it. And I spent six months, like probably 60, 70 hours a week working on it. And I was just really kind of just blown away about just how much is really involved in that process. Because you're, you know, you're buying a business. You know, those. That business comes with liabilities. Right. Hopefully it comes with assets too, because why would you be doing it? But.

Right.

You know, there's a lot of due diligence that you have to do. It's not like a property where as long as you have clear title, you know, you're good to go. Right. You can open up a new llc, closing llc, everything's fresh. Title company signs off and you get, you get insurance. Right. To ensure your transaction, to make sure you're protected. And it's definitely not the case on the business side. And it's awesome to hear that, you know, you did that benchmarking.

Yeah.

Just to understand, you know, your, you know, KPIs and, and all that sorts of stuff and, you know, really get a grasp around what you're about to get into. Right.

Yeah. And it's, it's, you know, it's crazy because I actually had an interview earlier today and we were talking about how, based on the model that I'm using to buy my business, how easy it is to buy businesses because of that, but how scary it can also be. You know, a lot of people, from my experience, when they hear that I'm buying a business, they're like, oh, that's so cool. I'm super interested in hearing about that. And it's something that I want to get into. And it's like, well, first of all, you know, I was at a conference last weekend in Puerto Rico with Pace and he brought it up. He's like, businesses are so much more work than buying houses and investing into real estate. And I don't think that people think that way. They're like, oh, I can just buy this and it'll just be a passive investment. And you know, sure, you can scale to a certain point that you can have a bunch of people in place, but that takes a lot of effort to get to that point. And so that's, that's one of the things that I definitely, I'm, I think that I'm a little bit different because I do want to be, I do want to be hands on. But I also, I'm like, I'm not going to sit there and be working the counter every day. Like, I do value my time more than it being 18 an hour kind of situation. But, but yeah, it's, you're, you're exactly right for sure.

How many employees does that UPS store come with?

So my store currently has three. I believe it should have one additional employee which I will plan on figuring out what kind of. So I'm actually wanting to design some kind of hybrid role of an outside salesperson with the capability to also work internally. And I don't know what that looks like yet because I think I would probably be one of the first owners that would. That does something like that. My goal is there's a college right down the road from my store and my goal is to try to go find somebody there that's in maybe like a marketing program or business program and that wants to do sales and bring them in and teach them and provide, you know, different courses. Cause I took sales training outside of my jobs and the stuff that they provide provided for me. So that would be, my goal is to help to teach somebody like that and offer kind of like an internship, a paid internship kind of program.

So it, it is, you know, it's essentially a franchise model. Right. So what do they place any restrictions on what you can and can't do as far as like marketing? Because I would assume they would and I could be totally wrong. I would assume that they would like want to centralize their marketing efforts to be one brand, not just each owner operator kind of branding their own thing certain ways. How does that work?

Yeah, good question. So they have part of their, their fee structure, if you will. So the royalty fee with UPS is the UPS store. Sorry. They're very picky about notifying that the UPS store and UPS are separate entities under one conglomerate, of course, but they're not the same. But the, so the royalty fee is around eight and a half percent. And.

I got three cats, so I may be doing this for a few minutes.

All right. So yeah, the royalty fee is around 8 and a half percent. And what that that encompasses is the actual royalty itself, which is just, you know, based on your profits and all that for, for royalty purposes. And then there's another portion of it that's for advertising, and then there's a portion of it that's for technology fee as well. So the advertising fee, what that covers is national marketing. So if you see any kind of commercials on tv, magazines, Entrepreneur magazine is a big UPS sponsor or vice versa, that kind of thing. And then there is, they also do like, they will go, I'll have a Facebook page for my store and they will go and post stuff for me on my, on my behalf in my Facebook page. I don't know if it's, if they have Instagram too. I want to say I heard they did, but I'm not positive. And then there's a, like a local fee that comes, that goes into that same piece as well. And basically what that is, is that's more to my geographic location. So obviously being in Florida, we get a lot of snowbirds down here, so we'll be marketing more locally to snowbirds and that kind of thing. However, if I want to do anything past that, I'm allowed to. It's just, that's what they kind of keep in place. I, there's, you know, the restrictions are you can't alter the logo, you can't like go on to the news channel and be like, oh, store, my store is opening. Promoting just your store in that sense. But as far as going and knocking on doors and, you know, picking up business for print and stuff like that, they, they heavily encourage that.

Gotcha. Okay, so you do have some flexibility in, in marketing growing and outreach and stuff like that.

Yep.

Okay. That's very cool.

Definitely.

What, so tell me about what kind of assets does that come with? I assume, like, I didn't know how your, your transaction was structured. If you leverage that or seller financing, how did you structure it?

Yeah, so we are doing. It's. Yeah, it's, it's an asset sale and it is seller finance. Originally it was going to go through the SBA which is for anybody that doesn't know the Small Business Administration. They will partner with banks and they will guarantee, I believe it's up to 70% of a loan or they'll carry it. With that, you get what, whatever the current interest rate is, plus an additional 2 or 3%. Usually. In my case, I was going through bank of America and they were one of the few that they offered a fixed rate. So that rate typically is adjustable, too. And I was like, this sounds like the housing crisis of 2008. That's not something I want to get myself into. And so of course, they're all like, oh, they think it's stabilizing and this and that. I'm like, yeah, I just don't think I can. I can't trust that. So I was very not interested in going that route. But then bank of America was like, well, we do have a program that we actually do with UPS that we offer a fixed rate. And I'm like, oh, that sounds fantastic. So started working with or with bank of America and went back and forth with underwriting. And they were basically saying, okay, you need to either bring more money to the table because my seller hadn't gotten his 2022 tax returns together yet. And they're like, based on his 2021 tax returns, we're not going to be able to do this. And I was like, I understand. I will get the tax returns. So I get the tax returns. And we had been in, like, back to back, back and forth communication, like, quite a bit. And then I get the 2022 tax returns and I submit them and I talk to the girl. I say, hey, I just sent these in. She's like, oh, yeah, I see them. I'll look them over and I'll get back to you. It was just crickets from there on out. And even prior to that whole situation, once they were kind of, you know, teeter tottering on the. I don't know if this is going to work out. Talking about having to bring more money to the table. That's when my mind started going into panic mode because I'm like, one, I have no idea how to do this otherwise. And two, if they want me to bring more money to the table, I'm like, this doesn't. This deal isn't going to make sense. It's just. It's not. And so I, I was like, okay, what other options do I have? So that's when my boyfriend actually introduced me to Pace, and he was like, watch this video. And he's like, it's on seller financing and basically how to negotiate it. And I was like, okay, cool. I'd known what seller financing was, but I had no freaking clue how to negotiate it. So I, I, I was like, all right, yeah, let me, let me watch it. So I start watching it and then Pace starts talking about, you know, seller financing and private money lenders. And I'm like, what's a private money lender? How does that work? Like, people just give you money and you can pay simple interest. Like, what is this? So my mind just like got like exploded within like a day. And I was like, okay. I just went from a place of like super not like uncertain and just very uncomfortable with what was going to happen with this deal to I felt super confident that if this didn't go through because the seller didn't want to do seller financing, that I would find another deal in no time flat and everything would be fine. So I know this is a long, drawn out story, but long story short, I ended up going to my seller and saying, hey, the bank is just really not going to like, not going to loan, offer a loan for this. And I said, you know, asked just questions like what is it you're looking for? I got them down. Originally we had agreed upon $400,000 asking price and then I was going to do the traditional financing. Once that didn't go through, we'd, we agreed upon 450, which was what, which is what his original asking price was at 125 down 0% interest rate. And then he came back and said, so we, we got to that because I said, hey, he originally said that he wanted like 8% or something because that's, you know, the going rate is 8% with the banks. And I'm like, buddy, I understand what you're saying, but that 8% is what is making this deal not a deal for me. So I, you know, I literally did exactly what Pace did and he's, I said I would be happy to give you your full asking price, guarantees you more money, 10 year loan at 0%. That way we don't have to deal with any of that. And he's like, okay, yeah, I'm good with that. So yeah, basically that's, that's how it all went down. And then he brings up this whole imputed interest thing, which I'd never heard of. And I was like, what is that? And then long story short, again, we just negotiated the selling the sale price to 425 with 2% interest, which is the payment Was the same either way. And he just, just to cover the imputed interest situation.

That's, that's very cool. Yeah. I mean, seller financing, usually, you know, both parties end up winning. Right. You know, usually the seller can, you know, obviously in real estate, it works that way too. The seller gets more. A lot of times I get more than what they originally would have got on the retail market.

Right.

Someone like you is willing to pay more for the right terms.

Yeah.

And you know, that, that allows that deal to happen. And a lot of times, especially if you're talking about spending six months on due diligence and, you know, you get to the finish line and you know, in, in your situation where it's like, hey, this deal's not going to happen unless you help me out. Usually they don't, they don't want to start that whole process all over again. Right. Especially if they're willing to, you know, wanting to retire. They don't want to start all over. They're ready like, okay, I just want, I see the light at the end of the tunnel or I see the, the margaritas I'm going to be sipping on the beach or something like that. And yeah, they want to get the deal done.

So that's exactly. Well, and the, the, I mean, I guess I would say good part about all of this for me was he had already had it, had the store under contract with somebody else, and they had a financing issue as well. And that fell through because of that. And then when this all happened, now, mind you, my seller is the most motivated, unmotivated person on the face of the planet, is when it comes to getting rid of this store he actually bought. This is mostly speculation, part of it, speculation. But he, he bought. He does own another business that is conflict of interest with a UPS store. So it's funny because he, he bought a framing business and he's going and turning it into like a framing slash print shop.

Okay.

Yeah. So, yeah, So I was like, all right, well, I'm not really sure why you felt the need to go do that on your own other than. I'm certain, because it's, you know, he doesn't have to pay his 8% on it or whatever, but, you know, you can get a lot of business out of utilizing the UPS name just by that. So anyway, that's another.

A big, big brand name.

Yeah. Yeah, that's a whole, whole other story. We can, we can go into another time. But so yeah, he's, he's desperate to get out. He's got five Stores of which three of them are in Florida, two in Chicago, and he wants to get rid of all of them. And he has another one that same thing he has. He's got a lien on the business. And the deal went through, fell through, because he just drags his feet and he takes. You have to babysit him to get anything from him. And I mean, me having a sales background, I don't mind doing that. And I'm obviously not really doing a whole lot of other stuff, so I could afford that. But other people. We have the same attorney, and she was the one that let me know. She's like, yeah. So I found this out. And I was like, oh, so that store is available. So I'm actually looking at trying to buy that store as well.

Yeah. Awesome. So are you gonna buy all of them or.

I wish. He's got. All the other ones are under contract, so he's just got these last two that are left, but.

Wow. Seller's been busy.

Yeah, well, that's the thing. When you try to sell five stores at one time too. That's. That's a whole lot going on.

Yeah, no, that is a lot. A lot to juggle.

And UPS as a franchise is very hot right now. A lot of people are wanting to get in it, and there's a lot of sellers. There's a lot of transferring going on.

So you mentioned a 65 margin on the. You said printing, Right. If you combine the other revenue streams, what are you on average, planning to net, bottom line, margin wise?

Oh, gosh. So this first. So the as is, which. The store is not doing any print right now. Let me see. I. I did make a forecast for this.

And everything. While you're pulling that up, everything is a point of sale, right? I mean, you're getting. You're collecting cash immediately, right?

Yes.

That's awesome.

They do have this. They have. They do have it set up that you can do what's called like a house account, which is more of an accounts receivable. And I'm not interested in taking.

Accounts receivable is the bane of my ex.

Yeah, I bet. Yeah.

I look for. I'm looking for businesses that don't have any accounts or none of that. Don't want to deal with it.

Yeah, they. When I went through training, they were talking about, oh, it can be this great thing. And I'm like, that literally sounds like me not getting sleep at night. Which, if you know me, that's like, sleep is my gold. So, yeah, let's not. And say we Did. All right, let's see. Do I have this saved?

So do you have. Is your exit plan to just buy a couple or buy multiple UPS stores or do you want to venture into other areas? Is this just kind of the starting point for you?

Yeah, so I think it's going to end up being, I mean, quite honestly. So another part of the creative side of my purchase with this is I do have a private money lender that's going to give me around 75,000 for some closing costs and then working capital as well. So because this has taken so long, I am like, I don't want to completely drain my entire bank account on this kind of situation. So for my first deal, I don't mind having skin in the game because I think from an investor standpoint, moving forward, it's going to, you know, it'll provide some credibility for me kind of thing. But going forward, I could fully see, okay, what just happened. This opened and then it closed. I could fully see not using any of my own money in a deal going forward.

Yeah, that's awesome. Yeah, I think, you know, I don't know what Pace has planned as far as his rollout of buying businesses, but yeah, there's any PMLs that want to get into that, don't expect close in 30 days, I can tell you that for sure. Better get comfortable with that. Long drawn out. Yeah. I mean, depending on the size of the business, you know, if it's super small, like an owner operator. I don't think there's anything wrong with owner operator businesses. I mean, there's owner operators that just make a killing and do a fantastic job. But I personally would not buy an owner operator type of business where it's like one employee because that one employee was the business. You know, they held all the value. Right. Unless it's like, let's say it's an H Vac business and the guy has a book of business, book of customers. Well, if I'm an H Vac professional, that makes sense. You know, I can get on board. It's like you're buying the customers at that point. But if I'm me, I don't know how to do anything in the house. You know, I can figure out how to buy the house. But as far as handyman skills, I have zero. Yeah, I can barely tie my shoe. So, you know, it doesn't make any sense for me to do that unless I was buying an H Vac business that had 15 employees and one or two of them were supervisors and they were kind of Managing that, that and I wouldn't have to be, you know, maybe I could come in and make improvements in the back office and streamline processes and do the things that I'm really good at. But for me to look at something as like a one employee shop, that would be a very tough sell for me because it's, you know, they, again, they are the value of the business. So what are you really buying at that point?

There's. I get emails all the time about block. Like there's a. I think it's, I forget what it is but it's all online businesses that I get and they're like, oh, it's a blog and it plenty of opportunity for growth and if you're good at this and you can.

Do are the value of the business. So yeah, really buying at that point.

There's I, I get emails all the time about block. Like there's a. I think it's, I forget what it is but it's all online businesses that I get and they're like, oh, it's a blog and it plenty of opportunity for growth and if you're good at this and you can do that and then you can grow it. And I'm like, you're selling a blog that's been written by one person and the creativity of that one person. And I'm like, that just, it doesn't. Yeah, it was really, really weird.

So a lot of times what I see also like in, in the asking.

Price just got a new laptop and apparently I haven't opened Adobe on it yet. So it was trying to make me put my information in that I didn't have accessible.

Oh, you're good.

But yeah, just to your point, it's. Yeah, it's very interesting. And that was the thing. And it's hard too because I mean even with me I found out that my manager is a good manager and he just needs a lot of training but he's open to that. And that's the other part of it too. Like you can go in and if you've got somebody that knows, you know, knows what they're doing but they're not doing it as well as they could, you still might have some churn there. And that's something that a lot of people I don't think know how to address and, or especially in this day and age, I don't know if they want to address it because a lot of people get so scared and turned off by businesses because everyone's biggest complaint since COVID is it's so Hard to find employees. And so, you know, for me, I, I'm going in with an open mindset of, hey, I hear I have good employees. That's great, I'd love to keep all of my employees. But at the same time too, it's like with these slow transitions of how things I, I want to accomplish, if they're not willing to get on board with that, then I'm going to have to go out and find new employees. And part of my business plan too is my recruiting strategy. And it's literally that it's going out and it's finding people. Like I'm, I have no, no shame in poaching an employee from another business whatsoever. And that's how I was always found for my jobs. And it's, you know, I think it's a good strategy because you think about, especially nowadays, the people that are applying to your store and wanting to work in your company or whatever, what have you, they're people that need a job. You know, it could be somebody like me that was laid off. I was a good employee, so they offered me another position. But that, you know, those, those situations happen. But a lot of times too, it's, people jump around from job to job because they don't do a good job or they don't want to work or something. So you're, you're picking from like the bottom, the desperate workers, if you will. Whereas the workers that are the hard workers and the people that do their jobs well, they're not out looking for other jobs, they're working hard at whatever job they're doing. You just got to go find them. So that's one of my, one of my things that I think will make a difference too.

Yeah, I think every, every I know.

I have my work cut out for me.

Yeah. All the top talent I can think of.

Oh, gosh, sorry, say that again.

I said all the, all the top talent I can think of, they're all employed to your point.

Yeah, exactly.

And yeah, you gotta, you gotta think and part of it is just, you know, brand awareness and just doing the things like we're doing right now. Just getting, getting the word out there and you know, really trying to create the perception that, you know, is reality that your business is a, you know, business and you want to attract a world class talent, right?

Yeah, yeah, exactly.

And you know, top, top tier talent does not want to work for someone who doesn't have their act together. Right. They want to come and work in a, in a very way and deliver on professional results and it all starts with the culture that you're creating.

Absolutely. And that's another thing as part of my business plan too, in my long term goals with business ownership. And it doesn't necessarily just have to be within a UPS store. If I branch off into other things too. I want to create an environment for people that, for my employees that I should say that opens them, opens up a door of opportunity for them to be able to become partners with me. And if we want to go out and they want to buy a business and they want to figure out how, I will be there to support them, I will be there to partner with them and we can figure something out together. And I mean, this has changed my life drastically in just nine months. And I don't even own the business yet. And so, you know, it's, it's only going to get better. I mean, the stress is probably going to compound significantly once I actually have something to do. But you know what, I do well under pressure, so. But again, it's just the way that it's changed my life and it's, it's just made me broaden my view on what I'm able to achieve and accomplish. And ultimately I just, that's the biggest thing is working for these massive corporations. It just made me really realize that, you know, especially in a sales position, they don't care about you. And you know, they would always say, oh, well, we're going to pay you more. But then they would make this ridiculous comp plan that didn't make any sense. And then it's like, all right, this is, I have to get out my calculator here and you know, do the Pythagorean theorem, which I don't even know how to do that anymore, just to figure out how much my paycheck's going to be like, do you really care about me? Like, so. And then it's like they, they're changing it. And I get it. I mean it's, it's obviously what, from that scale, it's much larger. But it's just, again, I'm like, every time I got laid off, everyone was like, I can't believe it was you. Like, you're the best one. It doesn't make any sense. And I'm like, it's just a number. It's not supposed to make sense. Like they don't sit here and lay people off based on emotion. That's not what, that's. And I don't take offense to it because I understand how business works. And so. But again, I think, you know, being in a position like this, it just gives me a lot more control over my future, and I want other people to be able to realize that too.

Yeah. Oh, that's. That's awesome. So if people want to follow in your footsteps, you have any learning lessons to pass on as far as, obviously in the beginning, it's like, oh, my gosh, what am I doing? Fake it till you make it. Let me just try to figure it out as I go. What if you had to go back in time? What would you. What advice would you give yourself over the past seven?

I would have started talking about it more to other people. I didn't start talking about it really until, I mean, people knew, but it was something that was like, I kind of kept it a secret because I kind of wanted it to be this big, like, oh, she did. She's doing this great thing when it was like, after it had happened. But then I realized that I'm like, gosh, had I done this sooner, I wonder how much faster I could have accomplished all this because I have so many people now that are in places that they want to help me and they want to see me succeed through this. And back when I was starting this whole process, I'm like, I had a pretty broad scope of where I wanted it to go, but when you don't do something, when you've never done something and you don't know anybody else, that really does it either. And everybody buys businesses differently. Having a mentor is something that makes a huge difference. And again, just talking to people and figuring out who can help you in what way is the only way that you can figure that out is by talking about it.

Yep, absolutely. Well, I hope I can be a resource to you in any way. You know, I'd love you and whatever. Whatever you're doing. Yeah. I think just recently, honestly, I. I had, in the past had struggled about around the concept of, you know, building relationships. And my eyes have really been opened, you know, since joining sub2 on just the power of building relationships. Because everything. All the. The momentum that I. I thought I was having on my own was, you know, maybe here and then the relationship building just, you know, I mean, it just took it to 100x, right?

Yeah.

One conversation leads to another person, and that conversation leads to 10 other people and other opportunities. And, you know, I. I think just, you know, Pace talks about it all the time. Being a go giver. I think that's really important. Giving without any expectations of return.

Absolutely.

I. I know someone who's Looking for someone to put out a lockbox in a house in like 20, 30 minutes away from my house. I mean, I. I'm like, hey, I'll do that all day long. I have no expectation in return. I just want to help the guy out and maybe he'll want to have a conversation with me and I can learn more about his business and we can become friends and.

Yeah.

New deals together. I mean, that's just how stuff happens when, when you're generous like that.

Absolutely. I think I read that book last. Sometime in the last two years. An amazing book for one. But my dad was always like that. And I never really had a way to kind of, you know, put a name to it until I read the book and then. But the difference was my dad, he was such a giving person that he. He didn't have the best filter sometimes in judgment of people. And so he would. He would give when he probably shouldn't have given and he would get burned a lot. And so he's super, super negative now because of that. And I've, you know, me being his child, I've seen how that he's grown up and that's definitely part of what's influenced me and wanting to do this in the way that I want to do it. Because for me, I'm like, I want to create something so big that if somebody tries to take something from me, it's not going to matter. And that's great. I want, like, you know, it just. I think that's possible and my. That my influence and my value to people is going to be greater than what tiny little, you know, just anything that somebody can try to take away and that it doesn't matter. So. So yeah, that's just probably part of my dad being like that is what's gotten me to. To this point because it's completely controlled his life by going that route. But the sub 2 community is. You're right. It's been amazing, for sure.

Now that you've gotten a little bit of a taste of. On the business side, do you see yourself. Obviously you're going to have your hands really full for the next few months, but do you see yourself continuing down the real estate path or do you want to.

Yeah.

More into the business side.

So I'm definitely going to stay focused on. On acquiring businesses. That's my, my main trajectory for now. I do. I don't have any plans of. I mean, I've. I've considered buying and flipping businesses, but again, for what I want to do with my employees I think that from a longer term it would make sense to hold on to them and then, so yeah, that's, that's my immediate plans. But I do want to take the income that I'm getting off of that and I do want to put it into real. That's my goal.

Very cool.

Yes.

All right, well, you got anything else you want to share to talk about? Any other advice besides that I think you were looking at?

I brought, I got my gross margins. Right? Yes. So yeah, right now the store is doing so 2022 that was, there was a net of 122 was 133 I should say. There's a salary in there that's going to be an add back. So yeah, we can just do 122 for, for round numbers and then this is the 2023.

What did I forecast here while you're looking up that? I, I think one key nugget, if I will say as part of that negotiation process, usually when they're talking about, you know, I don't know, some, some businesses, you know, when you're looking online, they, they may list it as EBITDA or they miss may list it as a seller discretionary earnings. A lot of times they, well, almost every time they add the owner's salary back into that number to inflate the purchase price. And you know that that's usually the first point of negotiation that you know, I would go and discuss. It's like, hey, this isn't like a turn key plug and play. Like the owner obviously was in place running this business and it's going to take someone in place running this business, whether that's, you know, me or that's me hiring someone that's still in an additional cost. So adding that back wouldn't really be appropriate to some extent. And usually it's a back and forth between okay, we'll, we'll add half of it back or something like that. But that's usually a good negotiating piece because in reality, you know, that's, it's not always the case where you know, you yourself, you're going to have to step in and you're, it's not like you're going to spend zero hours a week. I mean you're obviously going to be pretty involved and there's going to be a cost associated with that.

Yeah. Oh, it's funny because when we went started negotiating the seller finance portion of it, he was, he calls me because I'd given him my offer and I had to literally babysit him. To get him to come back and tell me what his decision was. And so he calls me and he's like, just starts talking to me and he's like, so there's a manager there now and two other employees. And he said the store could probably use another employee. So he's like, are you planning on, on working in the store? And I was like, I mean, yeah, but I'm not, I'm not gonna be a full time counter clerk. Like, that's not. I'll be working in the store. To work. And he goes, okay. And he's like, are you gonna keep the manager too? And I was like, absolutely, I'm gonna keep the manager. And he goes, okay. Because he's like, because there would be, you know, some, some wiggle room there with the money if you weren't gonna. And I'm like thinking to myself, like, where's this guy going with all of this? Because I'm like, is he gonna sit there and try to say that he wants more? Because I all. If I work the store and I save money on employees, I'm like, that's not the route that I'm trying to head in. So that's.

Yeah, that's another thing that sellers will, will try to pitch you as far as, hey, you can do, you know, a B and C and improve your profits by 20%. And to justify their price. It's like, okay, well why didn't you do a, B and C over the past, you know, 10 years? Yeah, to justify your asking price. You know, you, you can't expect the buyer to pay a premium for stuff that they're going to do to improve the business. Right. Yeah, I see that a lot of times.

Or yeah. There was another store that was available in Miami that was like a 6.5 multiple EBITDA multiple. And I'm like, wow, why? And I asked the owner or the, the lady that represented the area, I was like, why does he want such a high multiple? And she's like, that's just feels that the business is worth and the opportunity. And I'm like, since when do we sell businesses on what, what they're capable of doing? Like that's not. I mean, that's. That, yes, you do buy into a business because of that. But like you said, why aren't you doing that and why isn't it there now?

So, and you're buying this for what, 3, 3.6, 3.7, something like that? Multiple?

Yeah, it's right. Yeah, somewhere right around there.

Gotcha. Nice.

It's Not a round number but yeah, it's I think it's lower than what some of the other stores typically go for. But I think the area that I'm buying into, the owner, the owner of the area kind of helps people suggest pricing and he's a little bit more old school so works out in my favor. But yeah. So for 2023 I forecasted. Well if I would have been in the store I forecasted doing 150 net. Right around 151 net. And then I don't think. Let me look through here.

How much was the owner paying himself?

Not very much. It was 25,000.

Oh wow.

Yeah, yeah. It was substantially lower than what I.

Oh because he was doing. He had his other business too, right?

Yeah. And he paid himself out of all of his stores too. So I think that's part of it as well maybe. Okay, so yeah, 2024, let's go here because print. Yeah. So 2024. Yeah, I've got it going to 202 for net income on 2024 and that's only with $5,000 in annual print sales because I, I did the first year I did not put. Contacts are getting blurry here. Yeah. The first year I didn't increase the print income hardly at all just because I was. My focus is going to be on understanding and learning the business and then the second year is when I'll, I'll focus on the, the product expansion which would be between print and then freight. Shipping is another thing as well that, that's got a very, very high 50% plus margin in it. But a lot of people don't do it because they just aren't trained on how to do it and do it effectively.

Nice.

International shipping is, is something else. That's crazy. I think it's, I think I forget what the number was but in training it takes, I think it's for every one international package it takes 27 domestic packages to make up make the same amount of profit.

Wow. So you've, have you already gone through the like their training, their in house training.

So part of it and that's honestly what has been holding up this whole process. It took us forever to get under contract and in order to get under con you have to be under contract for UPS even start looking at your considering. Yeah. So we got under, finally got under contract and then started the whole training process and everything and basically so it's. There's two, three weeks of in store training and then I have to go to San Diego to their Headquarters for one week of training and I was supposed to do all of that in August but the local team didn't have some of the paperwork done properly so. Or didn't have it done on time and submitted on time. So there was a wait list for the San Diego class and of course this all falls into. You have to do this before you can do this. So. So starting next month I will be back to, back to back weeks of training. So busy for sure. But it'll be all good because it'll, I'll close and then I'll be happy because I'd rather get it done and have it be right by, by the time I'm ready to buy the store.

So. Yeah. Well, it sounds like you've got a great plan, you know, especially for, for, you know, not having, owning a UPS store. Sounds like you, you've already done your due diligence, you've done your homework, you've benchmark other owners. I mean that's great. You know, those are all things that people should be looking at even more so when you're buying something that you don't necessarily have a, a background in prior to that and that's.

Right.

That's awesome. Sounds like you got. Definitely got a plan and you know, definitely got the mental fortitude with all your training and hats off to you on that.

Thank you. Thank you.

That's. It's going to be cool to watch. To watch to see what you do with it. Yeah, I think you're going to do really, really well.

I appreciate it. I, I hope so and I'm looking forward to seeing who else in the community I can, I can help. And if anybody's interested in learning more and wants to get into the UPS franchise, I, They've been fantastic to me so far and I would highly recommend them and I'd be happy to, to help look over anything if anybody has any questions about anything. For sure on that too.

Awesome. So how can we find you on social media?

Yes. So I'm on Facebook and Instagram and I do have a YouTube channel now. It is very, very spark.

But right now, let me.

Yeah, everything is just Lindsay Ellenwood. That's how. That's the easiest way to find me.

There's actually a lot of results. I'm surprised.

On Google?

No, on YouTube for just random, random Ellen Woods. Let's see. Might have to send that to me later, but I'll make sure I'm there. Well, cool. Thank you for taking the time today and definitely thank you for having me. Great learning for me. I'm always interested in learning different business models, especially one I don't know and never, never heard about, the UPS model. So that's a pretty cool learning on my side. So I appreciate that.

Absolutely. Well, thank you so much for having me and look forward to talking to you more. And as we, as I grow through this and seeing if we can maybe do some things together too in the future.

Absolutely. Just holler at me anytime.

Thanks so much. Have a good night.