Before getting into even considering a business purchase, you have to get a full disclosure of the business assets, debts, and cash flows to include sales, and expenses.
You need to know all of these that are going to transfer with a sale:
Building & land price and value (if not not leased)
Internal fixtures and equipment included to operate the business
Inventory valuation (food, beverage, any sellable product)
Sales figures for each month for past 12-24 months history
Monthy xxpenses including utilities, Food and beverage costs, and payroll.
Lease term for building and any leased equipment.
Income for each category such as table rent, beer and liquor sales, Billiards item sales like cues and accessories per month.
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It is a serious venture to get into and if the owner isn't ready to open his books, he is hiding something.
A lot of owners often have income not fully accounted such as quarter tables and other types of vending that you have to look at as well.
This time of year is the worst time to begin to purchase a business because we are approaching the spring and summer months which are traditionally the slowest income producing months for a pool hall. By the time ownership would transfer for someone having to go and get some outside financing, summer will be here. That is when you better have the cash resources to survive because summer can actually become a negative cashflow for a slow pool room that has a heavy lease.
This is why you need full disclosure and history so you can see just how good or bad the real business is. Daily bank deposit records are the facts of how much the business made each month. If you can't see the banking transactions of the business, then I wouldn't believe anything I saw on the books. They tell the real story of how the business did financially each month.
