Start-up Capital?

[Waxman]

Pat

I didn't send you an email and don't know what you're referring to.

Why waste time defending our points when the true goal is to help a potential new investor?

That's what I'm doing and, thusly, I stand by my cautionary tale of partnerships. My experience is admittedly not as vast as yours. However, the echoes of my bad times by other carwash operators gives the warning credibility.

 

[bigleo48]

Personally I beleive Jerm will suceed only if he really wants it and is willing to do almost anything to get it...but it all comes at a cost. His position is very weak and in tough economic times will be a hard sell.

If I was in Jerms position, I would rent a space an open a detail shop...much less capital involved. Build the business (and cash) to eventually buy a wash...then move the detail business there. If he fails...then at the very least, he's learned some valuable lessons.

My 2 cents
Big Leo

 

[Jim L.]

Jerm to answer your question on leasing. I have leased before. It was likely better than most would find. 15 year lease to own. I had no down payment, first payment after 45 days after taking over. He even left some soap and towels. We structured it as if the seller was holding the note. Every payment was ammo'd on 15 years at a fair interest rate. Every timely payment I made, I received a "credit" against the selling price" so I basically would own it out right after 15 years. I didnt have to pay for any equipment. I didnt own the building, equipment or land until the 15 years was up or I actually purchased it. I did have options if I wanted to terminate the lease so I was OK and I had penalties for paying it off to quickly so he was OK. Worked great. No the wash was not in bad shape or going under. Just a small less profitable wash than the others he had and in a tight market. Again, not likely to find. I almost walked many times before I signed because I thought it was too good to be true. Turned out great for me.

Your post is very interesting. I'm looking at it from the seller's side. Did the seller pay the property taxes? Were they factored into the lease payments?
Also what about insurance?

 

[Patrick H. Crowe]

Waxman:

I apologize for my mistake. I believe I got an email signed Waxman (not posted on ACF)
but obviously you did not send it.

It seems to me that some car wash association or some car wash journal could at least begin to collect statistically valid evidence on topics like partnerships for car washes (and so many other topics from quarter start up, to best pumps).

Instead we get opinions based on one bad experience or on "horror stories". Of course business people can accept or rejct those and the posters are free to jump from "horror stories" to sweeping generalizations about all partnerships.

Please read with care.

Patrick H. Crowe

 

[BayWatch]

Jim, yes the monthly payment included the principal and interest as if it was a loan, the property taxes and property insurance. The lease stated that if the taxes and insurance went up or down, the payment was adjusted accordingly. This was the sellers idea. It kept him from having to pay the closing costs, etc had he actually carried the note. I liked it and have used the same lease many times for myself as an owner and to convence others to lease their washes to me.