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possibility of buying a small company ..what to be look for
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Author:  ozthecoz [ Sun Jan 23, 2011 10:11 pm ]
Post subject:  possibility of buying a small company ..what to be look for
Hi,

I have been given the opportunity to buy a local taxi / private hire company for a nominal fee.

The company is relatively new and consists of 1 hackney car, 1 merc vito minibus and the option to buy an 18 seater "Bus" and has £2k worth of council contracts per month + regular bus work - the 18 seater stuff is very lucrative, in all therseems to be around £400 profit a week left after paying everything out.

There are currently 3 people using the cars over various shifts all paying in on a 50/50 basis.

SO - has anybody else been in this situation ? brought a newish company - what are the pitfalls, what do i need to look out for etc - any advice ?

Thanks
Author:  Sussex [ Sun Jan 23, 2011 10:20 pm ]
Post subject:  Re: possibility of buying a small company ..what to be look
ozthecoz wrote:
- what are the pitfalls, what do i need to look out for etc - any advice ?

Why is the old owner selling?

State of the vehicles.

Will the drivers remain?

How long are the contracts for?

Do you want to be on call 24/7?
Author:  ozthecoz [ Sun Jan 23, 2011 10:26 pm ]
Post subject:  Re: possibility of buying a small company ..what to be look
Sussex wrote:
ozthecoz wrote:
- what are the pitfalls, what do i need to look out for etc - any advice ?

Why is the old owner selling?

State of the vehicles.

Will the drivers remain?

How long are the contracts for?

Do you want to be on call 24/7?


in answer to the above

1 - its complicated lol but its someone ive known for 3 odd years and he is moving away from the area

2 - i know 2 of the drivers and they have said they will remain - third one - dont know him so that remains to be seen

3 - contract length - not thought of that tbh but its at least till the end of the school year

4 - not really lol but needs must and since ive left the circuit and been on my own im getting used to the phone gong off 24/7 :D
Author:  Sussex [ Sun Jan 23, 2011 11:03 pm ]
Post subject: 
Go for it then.

I wish you well.

Might be an idea to have a chat with Mr Wrexham.
Author:  MR T [ Sun Jan 23, 2011 11:18 pm ]
Post subject: 
If you are buying this as a company... make sure you find out what debt's you will be liable for.... this often catches people out.... and because people are paying on a 50/50 bases... whether you are liable for VAT...
Author:  toots [ Mon Jan 24, 2011 5:58 am ]
Post subject: 
Don't forget to do a business plan. Everybody forgets to do a proper business plan and then wonders why it hasn't panned out as they thought it would :wink:
Author:  Nidge [ Mon Jan 24, 2011 8:03 am ]
Post subject: 
toots wrote:
Don't forget to do a business plan. Everybody forgets to do a proper business plan and then wonders why it hasn't panned out as they thought it would :wink:



Take advice from the above ^^^^^^^^^^ always always do a business plan.

I wish you well in your venture.
Author:  ozthecoz [ Mon Jan 24, 2011 8:05 am ]
Post subject: 
cheers sussex, Mr T, Toots and Midlander :D

VAT had crossed my mind - it isnt registered yet but looking at the figures i do think it will need it ( is teh threshold 67k ?)

Business plan - i havent done one as of yet, ive seen all the figures, know when the lean time will be so am confident that it will turn a profit BUT i think i will try and do a proper business plan asap with forecasts etc - is it worth downloading many of the "templates" that are available on the interweb or is it better starting from fresh ?
Author:  Nidge [ Mon Jan 24, 2011 8:09 am ]
Post subject: 
ozthecoz wrote:
cheers sussex, Mr T and Toots :D

VAT had crossed my mind - it isnt registered yet but looking at the figures i do think it will need it ( is teh threshold 67k ?)

Business plan - i havent done one as of yet, ive seen all the figures, know when the lean time will be so am confident that it will turn a profit BUT i think i will try and do a proper business plan asap with forecasts etc - is it worth downloading many of the "templates" that are available on the interweb or is it better starting from fresh ?


Whatever you decide to do Oz get a decent accountant sorted and on your side ASAP and ask him to give the books the once over to make sure they are the real deal.
Author:  cabbyman [ Mon Jan 24, 2011 8:13 am ]
Post subject: 
You can try a template but they would often leave out important detail unique to that business.

A cash flow projection with some conservatism built in will give you an idea of when your tougher periods will be. The important thing is not to be too optimistic in case the figures you think you know aren't actually there when you get the business.

If you can afford it, speak to an accountant about what is involved in conducting a due diligence before you take over. That should uncover most 'nasties' that are hidden.

The more work you do before takeover, the fewer unpleasant shocks you'll have after.

It sounds good, prima facie. Good luck.
Author:  skippy41 [ Mon Jan 24, 2011 10:13 am ]
Post subject: 
Who drives the 18 seat Bus?? have they got a PSV??? and are the PSV service records up to date??
If the driver has what happens if he calls in sick??
Author:  ozthecoz [ Mon Jan 24, 2011 10:31 am ]
Post subject: 
skippy41 wrote:
Who drives the 18 seat Bus?? have they got a PSV??? and are the PSV service records up to date??
If the driver has what happens if he calls in sick??


the bus has 1 psv licensed driver + the new 3rd guy i dont know is psv licensed + one of the first things i intend to do is take the test (and hopefully pass)

So hopefully that is / will take care of itself - obviously i need to learn the ins and outs of it and the paperwork.

Other than the business plan nothing is coming up that i havent thought about which puts my mind at rest so too speak.
Author:  ozthecoz [ Mon Jan 24, 2011 10:33 am ]
Post subject: 
cabbyman wrote:
You can try a template but they would often leave out important detail unique to that business.

A cash flow projection with some conservatism built in will give you an idea of when your tougher periods will be. The important thing is not to be too optimistic in case the figures you think you know aren't actually there when you get the business.

If you can afford it, speak to an accountant about what is involved in conducting a due diligence before you take over. That should uncover most 'nasties' that are hidden.

The more work you do before takeover, the fewer unpleasant shocks you'll have after.

It sounds good, prima facie. Good luck.


Cheers - though had to ook up "prima facie" lol
Author:  toots [ Mon Jan 24, 2011 2:13 pm ]
Post subject: 
ozthecoz wrote:
Other than the business plan nothing is coming up that i havent thought about which puts my mind at rest so too speak.


I can't stress how important that business plan is and don't forget to be realistic when doing the figures side. Also you need to do a graph to show what some call the 'dead mans curve'. With your contracts only running to the end of the school year you need to know what will happen if you don't get another one or a smaller contract. With fuel being the way it is all these small things will have a knock on effect :wink:
Author:  ozthecoz [ Sat Jan 29, 2011 3:53 pm ]
Post subject: 
well i bought it !!!!!!!

Taking over on the 1st feb and thats when the hard works gonna start
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