Two businesses...what to do?

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shadowkitty

Mistress of Shadows
So my husband and I are in a position to buy a small business. We don't have a lot of cash to throw around but two great opportunities have come up. Both with pros and cons. We don't need to make a lot of profit to be comfortable. But we are torn between doing something we love for less profit, or something safe for more profit and opportunity to buy a house. I'd like to hear anyone's thoughts about these two opportunities.

Business 1:
Small vintage, secondhand, retro furniture and knickknacks, collectibles shop.

Pros - Cheap, cheap rent( cheap enough for us to buy business and put down 12 months rent and buy stock, and then sort out our car situation) Great landlord who is open to us doing whatever we want to the shop. May even offer the building to us to buy. Established regular customers. Something both hubby and I love. opportunity to put other things in the shop, like my art etc..

Cons- Shop situated in an industrial area. not much foot traffic, not much profit (opportunity to change this though). Shop is 40 minutes to 1 hour drive away from home. Would need to market shop, advertising etc..


Business 2:
Furniture and home-wares business with well known brand name.

Pros - Popular, well known brand throughout Australia, no need to advertise. Opportunity to make a LOT of profit. Great company to deal with, you basically have their name, buy their stuff, but what you do with it, and your shop is up to you, they hold nothing over you..it is not a franchise. You don't even have to stock their merchandise exclusively. Warehouse in our area making it more convenient to get new stock, or have customers pick up bigger items from the warehouse. shop owner may be open to part payment of business..

Cons - more expensive to buy. Shop in another town about 30 minutes away and not in the best of locations, still has 18 months lease (this may be able to change and we could move the shop down to our town, but this would involve a big move, fitting out new shop etc...) this all hinges on someone taking over lease on old location. Bigger risk, taking up all of our money. Commercial rent down our way is a little more expensive and sparse.
 

Mighty Pecan Pie

The secret American
Go with what you love. Might be a bigger risk, but when you always play it safe, you'll lose at some point.
 

JoeReese

Well-Known Member
Wow, what a choice. I'd like to say to lean toward what you love, but I have this tendency to choose the wrong path every time. Is there any possibility that the safer bet would help allow you to go for the labor of love later, or on a smaller scale?
 

shadowkitty

Mistress of Shadows
Wow, what a choice. I'd like to say to lean toward what you love, but I have this tendency to choose the wrong path every time. Is there any possibility that the safer bet would help allow you to go for the labor of love later, or on a smaller scale?

Safer bet has a lot more earning potential with the possibility of making part of the shop into a little coffee shop, bringing in more customers. It means we can go to the bank for a loan to finally buy a house. We can also satisfy our love for collectibles by including them in the shop as well.
 

JoeReese

Well-Known Member
With the caveat that I am known as universal bad luck, I would guess the safer option would be the best. On the other hand, Nyo has a point. Decisions, decisions.
 
If there's any way you could possibly do both of them, do it. I think with a little effort you could do both. Let me explain: if you open business one you could also, either now or later, stock business number twos stock. The reverse is also true. Another way to do it is to go with business number two now, then when you have made enough of a profit, buy into business number one and end up with the best of both worlds. However this is if there isn't a particular deadline to buy into number one.
Basically what I'm recommending - is to go with business number two now, make a good profit and then make it into what you love to do. Whether that means buying business number one or just doing it on your own when the time comes. That's what I'd do.
Hope this makes sense and helps a bit. :)
 
Oh and if/when you go with business number two, again I recommend making the commute for now and when you have enough of a profit, moving the shop closer to home. I think that would be your best bet. :D Obviously it will take a fair amount of time and patience, but I think it will end with the best outcome possible - you and your hubby doing what you love and also getting what you need. Again hope this helps!
 

shadowkitty

Mistress of Shadows
Well we met with our broker and the owner of Business two today and after talking about it, Hubby and I decided to put in an offer. Fingers crossed it's accepted!.

Basically what I'm recommending - is to go with business number two now, make a good profit and then make it into what you love to do. Whether that means buying business number one or just doing it on your own when the time comes. That's what I'd do.
Hope this makes sense and helps a bit. :)

Thanks! This is exactly what we intend to do :)
 

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