posted on September 27, 2001 11:59:29 AM
Seriously, I'd like some imput here, please?
A lady in a nearby town is selling her antique mall due to illness. It's located on a major highway in a growing area (if the economy doesn't collapse). The price includes a not fancy, but very cute old house, and the antique mall, and ALL of her inventory. When I say all, I mean that the entire house is crammed full of stuff-boxes full of old jewelry, an entire kitchen full of graniteware, advertising signs, utensils, etc-every closet, the attic, etc. I could sell stuff for a dollar a piece and pay off the bank loan. Really.
It means we would have to move there, hire help, do some remodelling on the house, and I would have to give up my regular job. On the other hand, I could list on Ebay for the rest of my life without ever hunting for another item.
What do you think-pros and cons? I really need some opinions, and don't know of any place where I can find as much expert knowledge about this business as here!
posted on September 27, 2001 12:04:23 PM
Buy the place--sell the stuff on eBay--clean up and sell the property. I would not quit a regular job to starve in a B&M now.
posted on September 27, 2001 12:13:38 PM
Wow! I can see how that would be really tempting. It sounds like a lot of work, and a lot to take on, but... what an interesting opportunity.
How do you feel about your current job, and would it be more of a struggle to make it with the antique mall? Do you have money in the bank to fall back on if things are tough at first? Are you patient? Are you excited about working hard and do you have the knowledge about -- or time to research -- all that stuff?
Those are the things I'd be thinking about if I was presented with that type of opportunity. I'm kind of jealous... it sounds like it could be fun and challenging!
posted on September 27, 2001 01:48:03 PM
Also what is the local economy - are the local businesses things that will go down the tubes if our current problems drag on or are they stable?
If the local business was say based around airplanes your business may be bad no matter how nice thr stuff is and how low you price it.
How good is the property for other uses?
Can you sell it for other uses in 2 or 5 years?
How hard would it be to get another job like you have now and is your current job really secure in 3 months or 6 months from now?
Are the mall tenants happy and stable?
Do they pay good and help or just rent?
Are there any problems in the mall like theft from customers or insiders?
posted on September 27, 2001 02:09:01 PMBearmom: If I lived by you, I would go in with you on the mall! I've always dreamed of owning an antique mall. By the way, you're not near NW Ohio, are you?
posted on September 27, 2001 02:45:30 PM
I can say if Ihad the means and an opertunity of this type I would jump on it for sure.
I have lived through several slow peroids in the economy and the Road side antique malls and indoor flea market do crazy business around here nearlyt year round no matter how the stock market is doing .. http://www.Dman-N-Company.com
Email [email protected]
posted on September 27, 2001 03:02:03 PM
How hard have you looked at this? I know (because we've bought inventory from places going out of business) that at first glance, boxes and boxes of stuff can look like much more than it really is. Also, has the owner been selling merchandise at a steep discount lately where there is a chance that the stuff has been "picked over" badly. Sometimes a deal like this isn't as sweet as it looks at first glance.
Not saying you shouldn't, like I said, we've bought out existing inventories and it can be a great way to pick up a lot of merchandise for a great price, just take what ever time it takes to get a real good idea of exactly what is there.
posted on September 27, 2001 05:43:40 PM
I've been talking to people about this all afternoon, and have found out a little more.
As far as location, it's on a major highway going through Texas, within 20 miles of several resort lakes, and in the historic district of a tourist town. Austin is spreading that way fast-if the economy holds out. Because of it's location and 150 feet of highway frontage, it should resell easily-if the economy comes back.
As far as selling her stock, she just put the place on the market about 2 weeks ago, when she found out about the cancer. There aren't any sales going on that I know of, but we are going to see them again Saturday and reach an agreement about NOT having a sale if we decide to buy.
Hubby and I went and looked at it again tonite, and the house is bigger than I first thought. There's a great place to put an English garden area for outdoor art and furniture displays, between the house and the shop.
I have an appointment to talk to a banker over there on Monday. I think a local bank would be more willing to work with me than our bank in Austin which is a national chain.
We will go through everything carefully on Saturday and let you know what we decide! Thanks for the advice, I'll keep everything you've all said in mind. Except for Helen, I know you think the world is going to end and it's a bad time to start something new!
posted on September 27, 2001 06:17:04 PM
Now, Bearmom
I don't really think the world is going to end. I've just seen so many antique malls in my area going out of business lately. I would be afraid to try such a venture at this time. But I'm really not qualified to give advice about real estate investment so I just gave you my gut reaction and you know what that's worth
I hope that if you choose to buy, that you are successful!
posted on September 28, 2001 12:17:03 AM
"I could list on Ebay for the rest of my life without ever hunting for another item."
This has worked for us. We bought fleamarket booths after a fire at the state fleamarket, one estate, and about 30 truck loads of NASA surplus. We brought it all home, stored it here and there in the barn, shop, house (what a mess!), and that's what we sell. We do look for new inventory pretty often but we never feel pressured. This has been our full time job for 3+ years, family of 4, mortage. If the PRICE IS RIGHT it sounds like a good move to me. If you get low on inventory, sell the house and move on or buy a new batch and restock.
As far as your regular job, depends on how you feel about it. I wanted to come home and was willing to work harder than at a "real" job. I feel that we made a wise choice. No matter what we do NOW, we have had 3+ years at home together as a family. CAN NOT REPLACE THAT WITH ANYTHING IN THE WORLD!
posted on September 28, 2001 05:07:12 AM
Thanks for that piece of advice, JT! The truth is that my RL job is already suffering. After I quit teaching, I got all of my liscenses and went into insurance and investments.
People will always have to insure their homes and cars to satisfy their lienholders. But the bottom has dropped out of life insurance and investments almost overnite. I feel lucky that the past few months I have been encouraging people to put their money into fixed accounts (our one variable went from 18000 to under 4000 almost overnight)
So if the economy does get tight, I will probably be better off in the 'used' business than I am right now! And a lot happier, I am definitely in a high pressure job right now!
The other factor is retirement. We have tried to save all of our lives. But putting 2 boys through college, on top of what happened to all of our investments, has really hurt. DH can retire this year, he has 30 years in education now. But we will have to have another source of income. This is something we can do and be together, go visit the kids when we want, travel and write it off!!
posted on September 28, 2001 02:31:10 PM
icyu, you've just mentioned our first road block! I've been talking to our banker, and one of the things she has to do is give him a detailed and complete inventory!
That's like asking me to list and describe all the dust bunnies in my house..I wouldn't know where to start!
posted on September 28, 2001 07:12:58 PM
Plan 2? We've been thinking outside the box, so to speak. Plan 2 is to tell the banker we want to buy the house for a home-get a home mortgage for the amount she's asking, and skip all the inventory and p&l sheets. It should be doable, the property alone is worth the asking price, and it really is a house, not a commercial building. And who's to know we're selling all the contents of the house on the internet?
We are going to have to compare home and commercial loan rates and see if there is enough difference to justify going for the commercial loan.
posted on September 28, 2001 07:34:20 PM
Or, what about this.
What if you buy the house for less than asking price, then buy the contents in a seperate transaction? Perhaps you have access to a creit union or something that you can borrow from on a verbal loan. Or a savings account that you can use as collateral, or a paid for automobile, etc.
The reason is....if you buy the house with contents ONLY as a house, you will not have a receipt for the inventory. You NEED that because you will have to claim your income when you sell it for taxes. The woman should not care if she gets the price she wants in whatever form.
You need to be financially creative so you can get a receipt for the goods withOUT making her produce a detailed inventory because she just isn't going to produce that if she wants out from under it quickly.
T
BTW, what do is use my kid's college accounts as collateral, ONLY if I know I can turn it around quickly. If something went wrong, I would sacrifice a car or something to cover it. Their saving bails me out when I don't have the cash for that "great can't pass up estate deal"...but I make
sure it's never at risk.
Also, if you do this full-time and have no other income, everything going in to your checking account is "income" and you need a receipt for all business expenses. We do NOT keep transaction level detail for income but just add every penny that goes in all year v. every (receipt backed) BUSINESS penny out.
This really simplifies the accounting.
posted on September 28, 2001 07:42:08 PM
Hi. Good Luck with your decision. A house full of stuff is my dream.
Try to keep a level head and look at the expenses in a realistic manner. Do they have leases in the mall? Do the booths and the merchandise meet with your standards. What does it cost for phone, electric, air conditioning, business insurance, building insurance, marketing, license fees. etc. etc. .
How is the house, does it need a roof? air conditioner? I bought an antique shop 4 years ago so am aware of the monthly bills that must be paid.
Don't overestimate the value of the inventory. Remember it's not worth anything until somebody buys it. Will be fun to watch and see what you decide.
posted on September 29, 2001 04:28:37 AM
jt, what a creative and wonderful idea! You are so right!! That would also make the mortgage payments lower, and we could pay off the inventory loan quickly and keep our bills down.
As you can tell, I'm up early this morning, too excited to sleep, so it worked out great that I saw your post before we left.
I will make your suggestion to her this morning. The boy's trust funds have already gone to pay for college (got 2 graduating in December, only one left! But we do have our investments. The banker told me that even though their market value has dropped, we can still use the 'on paper' value of them for a loan.
You all have some of the most innovative ideas-I knew I'd get some great advice here.
Many many thanks!!!
posted on September 29, 2001 06:05:27 PM
Well, we made our offer this morning-so now we'll just wait to see how bad she wants to get rid of it. Wish us luck!
On the way home, found a wonderful lot overlooking Lake Travis. DH pointed out that we couldn't afford to buy the mall, and build a house both.
posted on September 30, 2001 04:35:27 AM
I really don't think she will accept our offer, but we'll see how bad she wants to get rid of it.
I think if we do get it, the first thing I will do (which will take weeks) is sort every piece of stuff out into junk and keep boxes. Then I'll move all the junk boxes outside and have our cousin auction it all off by the box full. I really went through things yesterday and while it's not 'junk', some of it is not worth the trouble of listing, cleaning, photos, fees, etc. I'll go for the fast bucks on it.
posted on October 5, 2001 07:25:58 AM
Hi. I am assuming no word or you would have posted. My idea of heaven has always been row after row of Large victorian, Art Deco, Mission, or 50's houses filled to the rafters.
posted on October 7, 2001 06:21:15 AM
Nothing to report, yet! We made our offer, so it's just a waiting game now. If it doesn't sell pretty soon, she will call us maybe. But I know she wants to wait and see if someone will give her the asking price, and I can understand this.
I would imagine it depends a lot on the economy. As I said earlier, Austin suburbs were rushing toward that town. Now that building has come to an abrupt stop, her shop is suddenly not so valuable. I think things will improve and it will be a hot property again. But right now, it's going to take another online seller to make a living out of that business, the local market won't support it. So I'll be surprised if anyone offers her the asking price.
You all will be the first to know, but it may be a couple of months before she gets desperate enough to take our price-a very fair one, but not as much as she wants!
posted on October 7, 2001 06:45:04 AM
Good luck bearmom.
I used to live on Lake Austin off Bee Cave Road and I was stunned how fast that area built up in 5 years!!! You have the right to an informed opinion -Harlan Ellison
But we do have our investments. The banker told me that even though their market value has dropped, we can still use the 'on paper' value of them for a loan.