We are pleased to offer an outstanding salon in Kent County (Western Michigan) which offers manicures, pedicures, shellac, lash extensions, and waxing. A full range of hair services are also offered at the salon by three independent contractors who each rent a private suite from the owner. The business has a great website which helps drive its meaningful bridal, party, and event business activity. And as you would expect, the salon has 100(+) impressive Google reviews with an average 4.3 rating.
This profitable 15 year old business is consistently voted one of the premier salons in all of West Michigan. The salon is located in a very desirable small suburban town which is adjacent to a major, fast growing and highly regarded West Michigan city. The business occupies a corner 3,000 square foot space fronting both streets of the town’s main intersection. The quaint town offers shopping, dining, and services to locals, out-of-town regulars, and tourists. The seller owns the real estate and looks forward to entering into a favorable long-term gross lease with the new owner.
The business employs up to 10 operators who are paid through W-2 payroll; i.e. the business is fully compliant with State and Federal payroll tax laws. The business also employs four part-timers – three working as receptionists and one as a bookkeeper. And though the owner is a licensed manicurist, she generally has a light, in salon work week of approximately 25 hours which is divided between administrative work and up to eight hours of manicures for her long-time clients. She looks forward to joining her husband in retirement after the sale of the salon and adequate transition training for the buyer.
Let’s look at the numbers: Over the last five years (excluding 2020, the year of Covid) the business has had average annual revenues of $640,000 with average annual SDE (SDE = seller’s discretionary earnings – the normalized, historical cash flow available to pay an owner-operator and service debt) of $130,000.
The business is being offered at a highly attractive 1.75x multiple of SDE + on hand inventory valued at cost. In June, the inventory figure was $21,000. So the value price of the business is $130,000 x 1.75 = $228,000 + $21,000 = $249,000. And we have saved the best for last. There is no need to fret about dealing with bankers to buy this salon: With your $49,000 down payment, the seller will carry a $200,000 ten year seller note! The generous seller note makes this business opportunity both attractive and affordable for a first time salon buyer as well as a terrific add-on for a veteran operator with multiple locations.
For more information on this excellent business with an outstanding seller financing package, please contact Mike Greengard (email@example.com or 616-450-0707).