Are you the only owner?

M

mihilc

New member
Hello.



I want to start a detailing business in my town and I want to know if it's good to start by my own with a moderate facility, but grow in time and invest more, or to get an associate who can invest and start with somewhat bigger, with big working space, but splitting the profit on two.

Thanks.
 
i would venture on my own....why split profits where you do most of the work...



does your partner like to detail, or do it for the money?

does your partner know about product usage like you do?

does your partner know how to talk to people to retain, attract customers?

does your partner want the same end results as you do?
 
It all depends. I know a lot of small business owners who take on silent partners just to help get funded. A friend of mine owns a self serve car wash and I know he has at least 2 silent partners who help fund the construction and start up cost. My friend does ALL of the work and the other guys just get their percentage until they are paid back. A ton of people do this in order to get better deals on loans as opposed to going to a bank.
 
toyotaguy said:
i would venture on my own....why split profits where you do most of the work...



does your partner like to detail, or do it for the money?

does your partner know about product usage like you do?

does your partner know how to talk to people to retain, attract customers?

does your partner want the same end results as you do?
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For money.

No.

Maybe.

Maybe.
 
think about it....why would you borrow money from a partner, only to give him half of your profits for doing nothing....you might as well go to the bank and only get charged 10% of the loan for interest...



10K loan yields 11000 paid back....

50% profits on 10K earnings yield 15000 paid back....



I would borrow from someone who only wants a % back in return as interest, not based on profits...
 
toyotaguy said:
think about it....why would you borrow money from a partner, only to give him half of your profits for doing nothing....you might as well go to the bank and only get charged 10% of the loan for interest...



10K loan yields 11000 paid back....

50% profits on 10K earnings yield 15000 paid back....



I would borrow from someone who only wants a % back in return as interest, not based on profits...
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The bank might not be willing to give him a loan........
 
hadboosttroy said:
The bank might not be willing to give him a loan........
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small business loans can be VERY hard to get. Even the SBA recommends friends and family for loan before banks most of the time because of it.
 
My business was a sole proprietorship for about 10 years and then I sold it to a friend and his brother(partnership). One works the shop and the other is the frontman. It works for them, but I would never consider it. I guess I'm too greedy and anal.
 
There are two situations that you engage a partner for:



1. You need money

2. You need brains



I was recently trying to buy a business with a partner, I decided against it while working with the potential partner to find the right store to buy. The only reason I agreed to partner with him was that my wife and his wife were talking about it at a party and somehow I got roped into this thing.

The more I worked with the guy trying to find the business, the more I realized he had much less brain power than I want in people around me. I have adequate funds, so what was the need for him?



PS: I never use my own money to conduct business. Banks and VC firms are begging you to take their money, use theirs if you can.



A guy once said to me, "money is never a problem, its good business plans that are hard to come by". - he is 100% right.
 
To answer your question; yes, I have always been the only owner of my detailing business.



Also, I would highly recommend that you start on your own with a moderate facility, investing more back into the business as the business grows.
 
Honestly, partnerships probably kill more small businesses than anything else. People are inherently selfish and put their best interests ahead of others. That tends to put people at odds with an equal partner.
 
Altho I'm a sole proprietor at this point, I've had partners (with money) and got burnt on every occassion.



What I learned is a new version of the Golden Rule:



"He with the gold makes the rules."



Go it alone, and build value over time.



Jim
 
Just another thought for you on initial sizing:



Don't build a business on the "Dot Com" business theory, which is called BURN RATE. Guaranteed failure. Remember the dot com's of late 90's and early 00's?



Let the business build itself around you and your client needs.
 
Scottwax said:
Honestly, partnerships probably kill more small businesses than anything else. People are inherently selfish and put their best interests ahead of others. That tends to put people at odds with an equal partner.
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unfourtunatly he's right. go at it alone, then go to the bank with some solid earnings later and get your loan.
 
Ok, I got it, thank you very much for your answers. I will try to climb the ladder from the bottom up in time.
 
start with a small shop, get your name out there, then a year later once you are recognized, move to a bigger shop, or if you own the property, build onto it...that would be your best bet if you can afford to purchase the building like a house! That is if you plan on staying there for a long time
 
jsatek said:
VC firms are begging you to take their money, use theirs if you can.



A guy once said to me, "money is never a problem, its good business plans that are hard to come by". - he is 100% right.
Click to expand...



The business plan part is true, but the VC part sure isn't (in Oregon anyways). I have no interest in these types of things, but in my last term of school (finance major) I had a class where we worked with VC firms. The VC firms we worked with were typically interested in tech companies so the application for this situation might not be 100%....However, these companies were typically looking at around 2 proposals today, and would maybe give money to 3-5 firms per year. Not too good of odds! Also, these VC firms were interested in funding companies that were already in business.



Look to banks, friends and family first.
 
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