for example , some one used to run a hostel for a years and his hostel has got the popularity and a good name .
But he was a renter not the owner.
Can he sell his business to another renter ?
he has got a good name , reputation , he paved the road for a years for his success and decides to sell his business to another.
But what kind of hostels sale is that if he is not the owner but a renter of the building and might change the location by renting another building in another side of the city ?
15 years
Yes, it is the same as any other business. You can always sell your name, clients, business plan, furniture and so on. The new owner should be aware that he is only buying the business and not the property. This is the same in all business, not just hostels.
15 years
I think that only the diligent examination of income of the hostel can determine the price of the business
May be the hostels with legendary names and the ones who are many years in business in extremely busy cities can have a high price.
But the hostels who are just 3-5 years old ... its dificult to determine the price , just because they are not much time in business.
15 years
Obviously you must inform the landlord - he has to agree to the sale. He has a treaty with YOU and if one side of the contract is replaced by another person it´s only fair when the remaining side has a word to say.
A conventional way to determine the worth of a business is the yearly net profit * 10.
If you have a well-established reputation and loyal customer base it can be more, if you are in a city where opening a hostel is very easy it can be less and you might end up not getting much more than the worth of the furniture.
In the end, the worth of something is always only the highest price someone is willing to pay.
15 years
If the renting contract is in a company name, it is very simple and straight forward.
The shareholder of company transfers his shares to you via a sales contract.
Now you are the new owner of the company.
The owner of the building has no say in the matter as the renting contract has been signed with the company and not in a personal name.
If you don’t know these simple facts that all businessman know I suggest you don’t go into business IN ANY COUNTRY.
14 years
In simple terms - it is the business that has the value and the reputation and as long as you have credibility and can come to some sort of agreement with the building owner about your continued occupancy. You must have a good relationship with the building owner if you were to buy the business and things should work very well.
Additional essentials:
1. Get some sound business advice from reputable sources - a lawyer for your occupancy and lease, an accountant for valuation, a business coach for everyday operations, etc.
2. A non-competition contract from the former owner - so he / she can't start up a similar business across the street.
3. Participation and training from the previous owner included in your purchase price for smooth transition.
As with any business, good practices will ensure your foundation of success. Creativeness can begin with ideas, masterminding, client satisfaction and marketing.
All the best.
14 years
It would be interesting to explore some examples of sold out trade marks
So , the hostels building is not owned by the hostelier , but just rented.
And the hostel is on sale , with all its things , or may be without .
But what are the criteriums by which the value of the price is measured its not understandable for me ?
14 years
You accountant should be able to valuate your business for you but a quick overview of how it is valuated goes like this:
1. First the accountant assesses all of the Tangible Assets that is to say all physical things you own: so the beds, furniture, computers, supplies, prepaid lease, A/R etc that you own. - This is ususally more of a set. objective value
2. Then the accountant would go through and assess the value of your Intangible Assets. These are non-physical assets that you own such as goodwill, trademarks, permits, website, intellectual property etc. - This is a subjective value.
3. Then the accountant looks at previous revenue/expenses, your profit and how well the business operates. They will also look at how much the business is projected to earn in the next fiscal year. This revenue will be key in deciding what the business is estimated to be worth.
The accountant then puts this all together to decide the estimated value of the business, please keep in mind this is *estimated* because like everything in business it is all about negociation. The accountant's estimate is only there to help you decide what you want to sell your business for, at the end of the day you pick a price that you are satisfied with selling at.
As Santa Klaus said:
In the end, the worth of something is always only the highest price someone is willing to pay.
So true.
14 years
But the hostels trade marks do not have the same right and status as the hotels trade marke.
Where is guarantee that another hostel will not operate by the same trade mark as my hostel ?
14 years
But the hostels trade marks do not have the same right and status as the hotels trade marke.
Where is guarantee that another hostel will not operate by the same trade mark as my hostel ?
Well, a trademark's right and status should have nothing to do with what type of business you run. A trademark is logo, group of words or other distingishing charateristic of your product. If you trademark is a logo no one other business can use that logo.
If someone infringes on your intellectual property have your lawyer draw-up a cease and desist letter to that company.
14 years
But the hostels trade marks do not have the same right and status as the hotels trade marke.
Where is guarantee that another hostel will not operate by the same trade mark as my hostel ?
Well, a trademark's right and status should have nothing to do with what type of business you run. A trademark is logo, group of words or other distingishing charateristic of your product. If you trademark is a logo no one other business can use that logo.
If someone infringes on your intellectual property have your lawyer draw-up a C & D letter to that company.
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