Small business ownership

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jacob
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Post by jacob » Sun Jul 25, 2010 7:44 pm

I am quite interested in "diversifying" out of paper. Specifically, owning some kind of cash cow.
This thread discusses laundromats and pizza parlors.
The laundromat sounds brilliant, but pizza making seems like work (to me).
I have also considered owning woodland.
[I'm not entirely too sold on blogging, but some people have certainly made it work for them. OTOH there are very many people who don't make a lot from blogging.]
Any other ideas?


Night Runner
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Post by Night Runner » Sun Jul 25, 2010 7:49 pm

A barbershop (or hair salon) located near a medium/large-sized college. If you advertise and offer some perks for students (10% off with a student ID or get 9 cuts, get 10th free), you'll be set for life. ;)
Think about it: people's hair never stops growing, it needs to be cut ~once a month (at least with guys). Let's say you have a college with 10,000 students. About 5,000 will be male, and barring the bald/long-haired ones, you'd still have around 4,500 potential monthly customers. :^D


jacob
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Post by jacob » Sun Jul 25, 2010 7:52 pm

On a similar note: dry cleaning and ironing (This also sounds like work though), vending machines (I believe Warren Buffett started this way).
I prefer not having to deal with customers :) ... presumable people who go to a hairdresser don't cut their own hair.
I saw a list once about the typical costs of starting and stocking a business.
My ideal business is something which is capital heavy rather than work heavy.


murpheyw
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Post by murpheyw » Sun Jul 25, 2010 9:15 pm

.


jacob
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Post by jacob » Sun Jul 25, 2010 9:20 pm

Please start a new topic on tax liens. This is more of a brick and mortar business thread.


murpheyw
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Post by murpheyw » Sun Jul 25, 2010 9:44 pm

How about a reception hall? Seems like one might be able to purchase a building and stock it with basics like:

plenty of chairs and tables

a few fridges and stoves.
This may work better in larger cities where the continuous turnover of weddings, birthdays, and office parties seems never ending.
I envision a small amount of work, such as collecting deposits and payments and cleaning up the reception hall afterwords (or penalize the tenant and pay others to clean it up.


Q
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Post by Q » Sun Jul 25, 2010 9:59 pm

Jacob, if you are serious about laundromats, maybe we should talk more.
Laundromats require a single capital outlay. My co-worker/buddy is sort of flaky of pulling the trigger, but I've done a lot of research (and still probably need to do more).
Mainly, the utility costs will tell you what the costs are - electricity and water.


Steve Austin
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Post by Steve Austin » Sun Jul 25, 2010 10:39 pm

Re: reception hall, I've noted that some vineyards / wine tasting rooms throughout Appalachia do double duty and rent out to wedding receptions and other banquets.
Anyone built or seen a zero-energy, enclosed banquet hall?


Q
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Post by Q » Sun Jul 25, 2010 10:44 pm

No, but Bonny Dune in Santa Cruz has been moving towards Bio-diversity and zero-emissions farming, I haven't studied up on what other green tech they are using, but the owner is fully into the scene here.


Night Runner
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Post by Night Runner » Sun Jul 25, 2010 10:49 pm

@Jacob: "I prefer not having to deal with customers :) ... presumable people who go to a hairdresser don't cut their own hair."
Sorry, I thought that was implied in my post: you start the place up and hire some barbers, then advertise, have students come in - and voila! - your job is done. :^D Really, it's that easy. Maybe install a pinball machine while you're at it. (One of Buffett's earliest ventures. Setting up a video game arcade next to campus would also work (in this case, you can replace college with a school of any level) but more things can go wrong with an arcade machine than with a washer/dryer. If you know how to fix them up (or have a friend who can), go for it.


murpheyw
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Post by murpheyw » Sun Jul 25, 2010 11:26 pm

Self storage?


pbkennedy
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Post by pbkennedy » Sun Jul 25, 2010 11:31 pm

I think laudromats are intriguing also. But wouldn't you need to know something about fixing the machines? And how does one guard against other people's stupidity? You know, adding six times as much soap as necessary, drying things that don't belong in dryers? Wouldn't upkeep and maintenance be high? Paula


Q
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Post by Q » Mon Jul 26, 2010 12:06 am

Fixing a washing machine is like fixing anything else. Read the manual. For the amount of passive money that can be earned, learning to fix the machines is a low cost to me.
I think, thankfully, self-embarrassment in public is something that lowers stupidity in public, especially when using machinery.
Not sure what can't be dried in a dryer...


jacob
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Post by jacob » Mon Jul 26, 2010 12:19 am

I'm also not worried about the mechanical side of things (I can relate to that).
I guess dealing with permits and zoning is doable too, eventually.
I'm more worried about the legal side of it. People who shrink their woolen designer sweater because somehow the temperature setting was too high. When I lived in a dorm, some genius resident decided to use the common washer to dye color something result. Consequently, the subsequent users ended up with a bunch of pinkish clothes from residual dye traces.
Maybe this is solved by a simple insurance mechanism.
Things that can't be dried in a dryer included small children and animals (-:


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Post by Ralphy » Mon Jul 26, 2010 3:54 am

I used to operate an arcade machine and a candy vending machine at our pizza restaurant. Very good return on investment, and minimal work, but one restaurant is pretty small scale. I was maybe bringing in $50 a month. It would take a quite bit more initial work to find locations to operate additional machines.


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Post by JohnnyH » Mon Jul 26, 2010 4:04 pm

Capital outlay for a laundromat would be significant, no? Also, there seems to be considerable competition.
Same with storage units, my area is totally saturated with them. How would either do in a serious economic downturn?
I've been buying milk and eggs from a local in my strong agriculture community. Basically, their only costs are land, and the purchase of the animals.... In large suburban areas I bet raw milk would sell well at $8-10 a gallon. Pastured eggs, maybe $5.
But then you got the potential FDA harassment.


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Post by orinoco » Mon Jul 26, 2010 5:58 pm

Think about it: people's hair never stops growing, it needs to be cut ~once a month (at least with guys)
According to my records I get my hair cut every 5-6 months! (Yes I am a guy)


jacob
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Post by jacob » Mon Jul 26, 2010 7:42 pm

It seems that a laundromat business costs about half of what a house costs.
Seems to me that storing junk and washing people's clothes is pretty recession resistant. The latter probably more than the former. Junk storage has a lot of personal inertia. People keep their unused stuff for years. You could also argue that people would try to move into something smaller and consequently need a place to store their junk.
For storage, you can buy convertibles in Public Storage at a rather good yield though.


Kevin M
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Post by Kevin M » Tue Jul 27, 2010 3:33 pm

Perhaps we should start a laundromat REIT?


Q
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Post by Q » Sat Jul 31, 2010 7:35 pm

Right now in my area there are several mat's available. Close close to me is about 400k, about 30 minutes from me in a not so great town is another mat for 250k roughly. With a 30% outlay, that's 75k cash, the rest financed.
Most LM's turn about 3k-5k monthly, and costs can be brought down with solar installs I bet...


George the original one
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Post by George the original one » Sat Jul 31, 2010 8:56 pm

DIY coin-op car wash.
Storage units.
Rock quarry.


jacob
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Post by jacob » Sat Jul 31, 2010 9:02 pm

Rock quarry!? Seriously?


Q
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Post by Q » Sat Jul 31, 2010 9:36 pm

I think recycling is also high on the list. A large recycling facility makes dough. Just look at NUCOR - they recycle steel like crazy...


Steve Austin
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Post by Steve Austin » Sat Jul 31, 2010 9:39 pm

Rock Quarry. That must be another Rand reference (The Fountainhead this time).


George the original one
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Post by George the original one » Sun Aug 01, 2010 12:47 am

Yes, rock quarry.
Hey, I had to throw at least one thing out there that was off-beat!
In Oregon, despite a large gold rush that's boomed a few times over, the most money made via mining has actually been sand & gravel. All modern construction needs gravel, usually sharp-edged and minimally graded (pea gravel for drainage is one exception... highly graded and highly processed).
You have three ways to play this:

1) own a property and lease it to an operator

2) be a small-scale operator (requires portable rockcrusher, dozer, & loader, optional trucks or just contract that out)

3) be a large-scale operator (be the owner and just hire the crew & equipment as you need them)


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