Buying a Gift Basket Business – Are You Prepared?
What goes into the decision to buy an existing gift basket business?
It’s true that you must check the company’s books to make sure you’re buying a sound enterprise, but there’s more.
This story, about an entrepreneur in Washington State, features insight into how this new designer transferred her creative passion into ownership of a gift basket business.
Here are some article quotes:
“…found a way to turn her passion for shopping and crafting into a business.”
“…(discussed) the idea with her husband,…”
“…there’s a lot more to the business than putting together beautiful baskets.”
“…her background is in administration, human resources and management.”
I’m pleased to read about this owner’s management foundation so that she doesn’t only concentrate on designing; she’s also prepared to maintain the books, a critical component that ensures the business has the best chance to thrive.
If you learn that a competitor is selling their business, what’s your first question to the seller as you decide whether or not buying a gift basket business is for you?
Selling Your Gift Basket Business? It’s Worth More Than You Think
Every once in a while, and especially around the holidays, I read online listings from designers who are selling their gift basket businesses for an average of $5,000.
Why is the price so low?
My first thought is that these designers, selling to pursue other opportunities or because they put more emphasis on creativity and not the business side, don’t realize how much value there is within their firm.
There will always be inventory to sell, and those items (equipment, supplies, etc.) will always retain some value even if it’s half the initial cost. Here are areas where the business’s value is well above the $5,000 price tag.
1. Branding/name recognition, including business name, slogan, and logo.
2. Back office structure, which is all programming and software that organizes the firm.
3. Web site, the online real estate that’s worth gold in terms of keywords, back links, and shopping cart.
There are eight more areas of your business that bring its value up to a minimum $200,000 when you’re ready to sell that I haven’t mentioned.
What value would you place on your gift basket business right now, and why?
How Do You Buy a Gift Basket Business?
Not all businesses closing shop are ending because of poor management or slow sales.
Sometimes the owner is ready to retire, and rather than close outright, they prefer to sell the inventory and client list to a buyer.
Since 1990, I’ve helped about 24 owners successfully make this transition.
What the seller hopes is to find someone with as much passion as they have to take over.
What the buyer wants is a true accounting of the documented information so they can pick up where the seller left off.
There are at least 10 very-important points to review before buying a gift basket business. Do you know what they are?
Gift Basket Books
-
-
Visit Our Sponsors
