2. misc-audio
  3. 161901-2723

Opening Record Store

Looking for advice from my fellow audiogoners...I have the potential to move into a store front that is already being operated as a record store (lps only) and become the new shop proprieter/owner. The owner has offered me the space (rediculously cheap rent) in a good area of town. He has had his store for about 5 years now and has a steady customer base. He will be taking all of his inventory and record storage bins that were in the store.He has a web site set up already and signs out front indicating the name of the shop...I plan on rebranding the shop with name change and interior upgrades. It is not a large space maybe 800-1000 square feet. I have a rather large inventory of my own so my up front investment of vinyl would be minimal. The owner wants me to buy him out..basically give cash in return for his customer base and the potential to get my hands on pretty good collections. I am trying to come up with a fair valuation of something like this and I am looking for advice..What do you think something like this is worth? Thank you in advance.
fromunda

Showing 1 response by mitch2

mitch2
3,733 posts
 
You have received a lot of really good advice here, including;
@millercarbon 
No one knows the current worthlessness of the business like the current owner.
@noromance 
By keeping the name, inventory, and fixtures, he’s not really selling you anything other than an empty store that used to be a record store.
@jdane 
Minimally, you should ask to see his books in detail and study them carefully.
@uncledemp 
I think putting together a business plan would be time well spent.
All you are getting from this "deal" is the storefront with "ridiculously cheap rent in a good area of town" and a "steady customer base."  This guy is doing you no favors if he "will be taking all of his inventory and record storage bins."  Without the inventory and bins, all you are doing is renting a storefront and the "business" is worth zero.  The customers are already in the area.  Sheesh.....he has even become your instant web competitor who is selling his existing inventory from a website he is already advertising from your (future) shop!  Duh!

If the location is that good, and you are looking for a hobby, then open a coffee shop (serving something better than S'bucks), or a sandwich shop, where you can play good music for your customers and operate a B&M pick-up point for a vinyl web business.  Otherwise, in the wise words of: @millercarbon 
Its a rocks in your head thing to do if your goal is income.

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