May 22, 2022
Service: Acquisition Price Evaluation
Client: 3 package Franchise Gym Acquisition
Need: Client needed to know if the business is worth buying based on the asking price, especially because it was a package deal.
EZFS: We requested the seller to send us financials for each individual location so we can determine the cash flow of each location separately. The result of our analysis was that the asking price was too much for a business that had terrible cash flow for 2 out of 3 locations. We discovered that there was a decline of gym membership and revenues year after year, while only 1 location was stable. The Bank would not be able to finance the business with this type of performance, and especially with minimal equity and collateral. We were able to save the client their time and money and save them from a bad investment.