conbrue Posted August 28, 2011 Share Posted August 28, 2011 There is a Chippie near us that's for sale, the business comes with a 4 bedroom house and the chippy is well established. The current owners are retiring and have been there for about 20 years. I know nothing of running a chippy and even less about financing one, I would hope if we did buy it the current owners would help with training etc and we would keep the suppliers etc until we was more confident so basically business as usual for a few years. What I need to learn about is how do we get the money to but the place (no pun intended)...? Do we get a business loan/mortgage? Will we need money upfront? Is there something online akin to Money supermarket were you can find out re payments etc? We already own a house further down the road which ideally we want to carry on living in and I don't want to risk this house. I would carry on working but my wife would run the chippy with help from family and me. Sorry for all the newbie questions but you have to start somewhere. Thanks, Conbrue. Quote Link to comment Share on other sites More sharing options...
Jamer Posted August 28, 2011 Share Posted August 28, 2011 There is a Chippie near us that's for sale, the business comes with a 4 bedroom house and the chippy is well established. The current owners are retiring and have been there for about 20 years. I know nothing of running a chippy and even less about financing one, I would hope if we did buy it the current owners would help with training etc and we would keep the suppliers etc until we was more confident so basically business as usual for a few years. What I need to learn about is how do we get the money to but the place (no pun intended)...? Do we get a business loan/mortgage? Will we need money upfront? Is there something online akin to Money supermarket were you can find out re payments etc? We already own a house further down the road which ideally we want to carry on living in and I don't want to risk this house. I would carry on working but my wife would run the chippy with help from family and me. Sorry for all the newbie questions but you have to start somewhere. Thanks, Conbrue. I would imagine it would be just a mortgage on the property. Are they asking a realised price for the property or have they added value to it because of the business? if they have added value then it may require a business loan. Secondly, I would think that the current owners would stay on with you for at least a month to show you how the business has been run, you could ask them that question. Quote Link to comment Share on other sites More sharing options...
conbrue Posted August 28, 2011 Author Share Posted August 28, 2011 Hello Jamer, Thanks for the reply, the cost of the chippy must have some added on for the business as I live in the same street and my house value is about 50k less than the asking price of the chippy Quote Link to comment Share on other sites More sharing options...
Jamer Posted August 28, 2011 Share Posted August 28, 2011 Hello Jamer, Thanks for the reply, the cost of the chippy must have some added on for the business as I live in the same street and my house value is about 50k less than the asking price of the chippy Then I think you will find that it will be a business loan, however, get the place properly valued as you still may be able to buy as a normal mortgage, which at the moment would be cheaper. Quote Link to comment Share on other sites More sharing options...
conbrue Posted August 28, 2011 Author Share Posted August 28, 2011 Thanks, Are you allowed to have 2 mortgages? Will a deposit be required? Quote Link to comment Share on other sites More sharing options...
conbrue Posted August 28, 2011 Author Share Posted August 28, 2011 Is buying a chippy a good idea? People always need chips. At the moment this chippy does not open at night only dinner and tea times Quote Link to comment Share on other sites More sharing options...
Jamer Posted August 28, 2011 Share Posted August 28, 2011 Well any business is potentially a good business as long as it is in the right area and has a good reputation. You may need a deposit, speak to the bank etc... Quote Link to comment Share on other sites More sharing options...
pepper Posted August 28, 2011 Share Posted August 28, 2011 Most banks will fund (mortgage) you as long as you have an initial startup fund and business plan, its the same as a house mortgage, as long as you keep the payments up to date you have no problem, but fall behind and they are straight on you, i think they wanted me to have 30% deposit when i was looking to buy premises, and as Jamers says any business can be a good business, but make sure you do your homework before you take the plunge. Quote Link to comment Share on other sites More sharing options...
derren Posted August 29, 2011 Share Posted August 29, 2011 Chippy is always a good business if in the right location. When looking at this sort of business before I was told to count the chimney pots around you as this is your potential custom. Banks are terrible at lending at the moment but of course it depends on your business plan and structure. You will need a good business plan and you really need to understand the finance. Most of these types of business will be a sole trader so basically this means everything you have is at risk and you will probably need to put your house as security to any loan. The other option is a limited company but the likely hood of getting a loan on a limited company is virtually nil and if they did you would need to provide a personal guarantee. HSBC are the worst to lend with Lloyds being the best. So as with any business you would need to keep good records. HMRC are notorious at the moment at looking into cash business's so you would need to keep everything straight (until you know how to play the game :Winky: ) Tax will need to be paid on the profits and if a sole trader this income would be added to any other income. So you need to pay tax and class 2 nic contibutions on profits. This works out at roughly 30% of any profit you make. So you really need to look sets of accounts provided to you by the current owners to see how viable it all is. Whatever the level of profits is, loan repayments will come out after this. So see if you have enough to live. I see so many business's that just get by making a few thousand pounds profit for so much work. The owners are usually happy that they don't have to pay much tax on low profits but I say you might as well work in the local factory if thats all your making. Now one last thing, I love fish and chips. But for years its hard to get decent fish and chips where I live. Quality is very important and I used to go to a chippy where you ordered fish as you went in. Took 5 mins or so but that was the best fish ever rather than soggy fish that has been cooked ages ago. Derren 1 Quote Link to comment Share on other sites More sharing options...
sparks Posted August 29, 2011 Share Posted August 29, 2011 Some good advice from Derren.. Just a couple of personal observations to add. You've mentioned that currently it isn't open at night. If you plan to change that, are you prepared to deal with the inevitable oiks? And with raw material prices only going in one direction and people's disposable income going the other way, the service industry is imo going to get hit hard over the coming years... Quote Link to comment Share on other sites More sharing options...
conbrue Posted August 29, 2011 Author Share Posted August 29, 2011 Thanks guys, Not sure about the night opening as it may saturate the market, there's only so much fish and chips people can eat... Not much parking nearby to tempt anybody but the locals really but the current owners seem to do well. Great points Derren thanks, I suppose the paperwork side of things is what will be completly new to us. Quote Link to comment Share on other sites More sharing options...
Jamer Posted August 29, 2011 Share Posted August 29, 2011 Some good advice from Derren.. Just a couple of personal observations to add. You've mentioned that currently it isn't open at night. If you plan to change that, are you prepared to deal with the inevitable oiks? And with raw material prices only going in one direction and people's disposable income going the other way, the service industry is imo going to get hit hard over the coming years... Nothing like being a little negative... Well I have to say that I deal with customers all day long and we have never been so busy, I think people can talk themselves into a resession! besides people have to eat, so If you serious, I would start negotiations with the current owners and ask to see the books for the past 3 years, this will give you some idea. Quote Link to comment Share on other sites More sharing options...
sparks Posted August 29, 2011 Share Posted August 29, 2011 Nothing like being a little negative... Well I have to say that I deal with customers all day long and we have never been so busy, I think people can talk themselves into a resession! Good for you.. But I'm not being particularly negative - just realistic!... There is a fine line between not talking the economy down, and sticking your head in the sand... :Winky: Quote Link to comment Share on other sites More sharing options...
gibberish Posted August 29, 2011 Share Posted August 29, 2011 Don't forget the dreaded VAT - If you're in business, you must register for VAT if your VAT taxable turnover for the previous 12 months is more than £73,000. This figure is known as the VAT registration threshold. The threshold changes - usually once a year announced in the Budget - so you should regularly check your turnover against the current threshold. You must also register for VAT if either of the following applies: you think your VAT taxable turnover may go over the threshold in the next 30 days alone you take over a VAT-registered business as a going concern if the above applies then £20 out of every £120 you take (less VAT paid on costs) belongs to the VAT man immediately - hot takeaway food is subject to VAT even though you don't pay VAT on the raw food. Quote Link to comment Share on other sites More sharing options...
badlad Posted June 11, 2012 Share Posted June 11, 2012 There is a Chippie near us that's for sale, the business comes with a 4 bedroom house and the chippy is well established. The current owners are retiring and have been there for about 20 years. I know nothing of running a chippy and even less about financing one, I would hope if we did buy it the current owners would help with training etc and we would keep the suppliers etc until we was more confident so basically business as usual for a few years. What I need to learn about is how do we get the money to but the place (no pun intended)...? Do we get a business loan/mortgage? Will we need money upfront? Is there something online akin to Money supermarket were you can find out re payments etc? We already own a house further down the road which ideally we want to carry on living in and I don't want to risk this house. I would carry on working but my wife would run the chippy with help from family and me. Sorry for all the newbie questions but you have to start somewhere. Thanks, Conbrue. Did you put in an offer? Quote Link to comment Share on other sites More sharing options...
Rother Posted June 12, 2012 Share Posted June 12, 2012 Interesting that this old post resurfaced. Interesting in that about 4 years ago a friend of mind bought a chippy business. It was run down and business was slow to none existent. Mainly because 2 pubs close by had shut down. His business plan was not only to be the best tasting fish n chips in the area but he was going to open all day (most around here, apart from the town center just open for lunch and 2/3 nights a week) He put big signs up and adverts in the local papers to tell everyone he was open all day etc. He ran at a loss for nearly 6 months but slowly things turned around - most business from people wanting fish n chips in the afternoon or on the way home from work. Besides passing trade, people actually drive well out of their way to his shop now and everyone knows that he is open all day. Quote Link to comment Share on other sites More sharing options...
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