Unanticipated Expenses

[jdr]

We're working up a business plan for a pool hall we're hoping to take over from prior owners. We want to try to be as thorough as possible, but are there large unanticipated expenses that you wouldn't have originally thought of? (I can't really give an example, since then it would be an anticipated expense, but maybe something like city licenses specific to pool halls, etc.?)

BTW, this part of the forum has been invaluable to us. Thanks everyone for sharing your experiences.

 

[poolhall maven]

your air conditioner breaking on a saturday...you get to pay for the weekend service call-but you must have air conditioning for your customers or they will go somewhere else.

county licenses, city occupational license, alcohol license, corporate taxes,tangible taxes, property taxes,amusement machine taxes I'm sure I forgot some and then your need to pay an accountant...to keep all this junk straight! fun times!

 

[realkingcobra]

What condition are the bathrooms in? I don't know of to many pool rooms that have decent bathrooms in them. Are you planing on recovering the pool tables, or just continuing on with the same trend as the out going owner?

Glen

 

[scottycoyote]

are you takin over a poolroom that people are retiring from, or is it one thats going out of business.

 

[Jack Madden]

your air conditioner breaking on a saturday...you get to pay for the weekend service call-but you must have air conditioning for your customers or they will go somewhere else.

Pool room is like cue making business --- you need to be ready for any breakdown and cost to repair or replace. Electrical (lights or wiring), plumbing, your equipment both tables, chairs, bar or food equipment, heating, etc. This are all unexpected and irritating but will happen.

 

[cueandcushion]

Our unexpected cash expenses for 2006...
Wind storm shut down electric for 5 days. had to buy a phone that operated on the 14v phone lines instead of our deluxe system.
Sewer line collapse. Had to shut down for 6 days.
Ice storm. Power out again.
Expenses of gas powered generators.
Ice chests for keeping drinks cold.
Had to buy an answering machine to inform customers of our situation.
Ended up sleeping AT the store since everyone in the area knew we had no alarm system and the police were busy 24 hours a day. My rottweiler was the alarm system for a couple nights.
Household cleaning supplies. It will add up. Pine sol cleaner should be bought by the gallons. Liquid Plumber, lots of it!!! Super Glue, duct tape, electrical tape, will come in handy when you least expect it.
Air fresheners...Lots of cheap stuff from the dollar store. Room owners know why!
Paper towels like there is no tomorrow.
Vaccuum cleaner bags...you can never have enough.
Recharging fire extinguishers and fire extinguisher permits.
Always save any merchandise that is hard to sell. Dont discount it! Instead donate it to the police and fire department for whatever benefit they have. YOu get the tax deduction and good relationship with the locals.
Keep a petty cash box on hand for wierd emergencies....you someday will need a sewing kit at midnight. Yes you will! Take my word for it.
Thats all the ramblings I can think of right now. I am hungry and have to eat.

 

[JimS]

Our unexpected cash expenses for 2006...
Wind storm shut down electric for 5 days. had to buy a phone that operated on the 14v phone lines instead of our deluxe system.
Sewer line collapse. Had to shut down for 6 days.
Ice storm. Power out again.
Expenses of gas powered generators.
Ice chests for keeping drinks cold.
Had to buy an answering machine to inform customers of our situation.
Ended up sleeping AT the store since everyone in the area knew we had no alarm system and the police were busy 24 hours a day. My rottweiler was the alarm system for a couple nights.
Household cleaning supplies. It will add up. Pine sol cleaner should be bought by the gallons. Liquid Plumber, lots of it!!! Super Glue, duct tape, electrical tape, will come in handy when you least expect it.
Air fresheners...Lots of cheap stuff from the dollar store. Room owners know why!
Paper towels like there is no tomorrow.
Vaccuum cleaner bags...you can never have enough.
Recharging fire extinguishers and fire extinguisher permits.
Always save any merchandise that is hard to sell. Dont discount it! Instead donate it to the police and fire department for whatever benefit they have. YOu get the tax deduction and good relationship with the locals.
Keep a petty cash box on hand for wierd emergencies....you someday will need a sewing kit at midnight. Yes you will! Take my word for it.
Thats all the ramblings I can think of right now. I am hungry and have to eat.

Good Stuff! Cooll post.

 

[Dartman]

We're working up a business plan for a pool hall we're hoping to take over from prior owners. We want to try to be as thorough as possible, but are there large unanticipated expenses that you wouldn't have originally thought of? (I can't really give an example, since then it would be an anticipated expense, but maybe something like city licenses specific to pool halls, etc.?)

I assume your post is geared more to unanticipated startup expenses rather then ongoing expenses.
You should have standard business licensing issues - city, county, beer/liquor, food permits. Have a pro inspect the facilities as to plumbing, electric, hvac, - if things need fixing or upgrades then permits may be necessary. You would do well to have an independent check the tables, lights, ancillary equipment for any needed repairs. You may consider a BCA membership. How secure is the building - would it need new locks, an alarm system or monitoring service. What about insurance - fire, theft, liability, etc. Do a good job on all the "what-ifs" and you can probably keep the unanticipated expenses to a minimum.

 

[manwon]

We're working up a business plan for a pool hall we're hoping to take over from prior owners. We want to try to be as thorough as possible, but are there large unanticipated expenses that you wouldn't have originally thought of? (I can't really give an example, since then it would be an anticipated expense, but maybe something like city licenses specific to pool halls, etc.?)

BTW, this part of the forum has been invaluable to us. Thanks everyone for sharing your experiences.

Kick backs to Organized Crime ( Protection Money) This one is essential

Have Good Night!!!

 

[cuejoey]

We're working up a business plan for a pool hall we're hoping to take over from prior owners. We want to try to be as thorough as possible, but are there large unanticipated expenses that you wouldn't have originally thought of? (I can't really give an example, since then it would be an anticipated expense, but maybe something like city licenses specific to pool halls, etc.?)

BTW, this part of the forum has been invaluable to us. Thanks everyone for sharing your experiences.

get to know the neighborhood your future business is in..is it turning for the worse with high crime ? talk to the Police and neighbors.once you buy the business will the city give you the proper permits and licenses to continue ? is the property going to be demolished in a few years or earlier for a city,state or federal project ? how do your future neighbors feel about a pool hall continuing business there ? any of the above can lead to ALOT of unexpected legal expenses..i have known people who have fallen to the above and spent thousands of dollars for lawyers fees in fighting city hall and neighbors eventually going bankrupt doing so....so talk to EVERYONE you can.....good luck...

 

[Jack Madden]

Kick backs to Organized Crime ( Protection Money) This one is essential

Have Good Night!!!

Craig
I know this was in jest.
But you just reminded me of something. Years ago I worked at Bob's Big Boy (if you are "old" you may remember the CA burger franchise with the little fat boy holding a hamburger with red and white checkered pants). It was a policy to always invite the local police officers to eat in the staff's lunch room if they didn't want to eat out front. And coffee was always free. It was a good policy - cops had a good place to eat (we even had the narcs) and we had a little extra "protection" for a cup of coffee. So maybe a cup of coffee as unanticipated cost.

 

[manwon]

Craig
I know this was in jest.
But you just reminded me of something. Years ago I worked at Bob's Big Boy (if you are "old" you may remember the CA burger franchise with the little fat boy holding a hamburger with red and white checkered pants). It was a policy to always invite the local police officers to eat in the staff's lunch room if they didn't want to eat out front. And coffee was always free. It was a good policy - cops had a good place to eat (we even had the narcs) and we had a little extra "protection" for a cup of coffee. So maybe a cup of coffee as unanticipated cost.

Hello Jack, I am from St. Louis originally, and yes I do remeber Bob's Big Boy, it must have been a Nation wide Franchise. Jack, I was just trying to add a little humor to this thread, I thought that it was getting to serious, and the guy wanted to know anything that could happen, who knows.

Have a nice day Jack.

 

[Jack Madden]

Hello Jack, I am from St. Louis originally, and yes I do remeber Bob's Big Boy, it must have been a Nation wide Franchise. Jack, I was just trying to add a little humor to this thread, I thought that it was getting to serious, and the guy wanted to know anything that could happen, who knows.

Have a nice day Jack.

Craig
Sorry - its hard to convey in writing what you feel sometimes. I totally understood you were trying to lighten it up. And it just hit me that a cop should be good "protection" --- of course a cup of coffee shouldn't be too big of an expense.

 

[manwon]

Craig
Sorry - its hard to convey in writing what you feel sometimes. I totally understood you were trying to lighten it up. And it just hit me that a cop should be good "protection" --- of course a cup of coffee shouldn't be too big of an expense.

You are right Jack, and even a cup of coffee may be considered payment for protection, hell I would protect someone for a coke!!!!!!!

Have a nice night Jack!!!

 

[Rod]

The Lease, how many years & renew option. It is a fixed expense but pay attention to maintenence. Who pays for what, should something go wrong/ What if the roof leaks or plumbing inside the building and outside? If you pay (which some do) be sure to know the condition before signing anything. As mentioned by others it can be expensive.

Rod

 

[cueandcushion]

The Lease, how many years & renew option. It is a fixed expense but pay attention to maintenence. Who pays for what, should something go wrong/ What if the roof leaks or plumbing inside the building and outside? If you pay (which some do) be sure to know the condition before signing anything. As mentioned by others it can be expensive.

Rod

One thing that is rarely mentioned in many leases is compensation when repairs are not done in an orderly fashion. I have known a LOT of bar owners and pool room owners that have dealt with leaky roofs for MONTHS before they get fixed. This adversely affects income. If you dont have air conditioning all during July...you will be empty. You must have a list of every concievable repair and what your compensation will be when it is not fixed. If you dont...many landlords really dont give a sh*t. If it is COSTING them money they move a lot quicker. Most leases will start deducting money once a repair goes 3 days (not counting Sundays/holidays) . Also make sure you insurance covers your interior fixtures and ask about loss of income for natural disasters like windstorm, tornado etc. Maybe they offer it maybe not. Wont hurt to ask. They may not cover bad food but they may cover generator rentals. Ask BEFORE an emergency happens.

 

[cuejoey]

Great post

 

[ribdoner]

We're working up a business plan for a pool hall we're hoping to take over from prior owners. We want to try to be as thorough as possible, but are there large unanticipated expenses that you wouldn't have originally thought of? (I can't really give an example, since then it would be an anticipated expense, but maybe something like city licenses specific to pool halls, etc.?)

BTW, this part of the forum has been invaluable to us. Thanks everyone for sharing your experiences.

Owned/operated a medium(23 tbls,7k sq') pool hall for several yrs. The advice you've gotten here is invaluable but it can't cover all variables.

You might consider hiring one of our site members who is experienced as a consultant.

Spending a little now could save you a TON down the road.

 

[Dawgie]

I am not sure what you mean by unanticiapted expenses but here are some of the things you may want to be aware of.

The condition of the physical bldg. roof, doors, locks, windows, flooring, siding, signage, outside lighting, parking lot, curbing, sidewalks, steps, and storm and hurricane shutters if applicable.

Next would be the condition of heating and AC equipment, interior lighting, fans, smoke evac. system, smoke detectors (or the req. of such) fire sprinkler system, tables themselves, pool balls, cues and assoc. equipment, interior flooring, interior ceilings and anything atttached to them. Also refrigeration equip. for food, sodas, drinks, etc. Cooking equip. and exhaust hoods, fire systems, hood lighting, prep tables ( do all these things meet current code?). Are you going to be responsible for any of these or other safety items. Check with the local construction office in your town and ask if there is anything you should be aware of or will be required to replace, bring up to date, or install when or after you buy.

You will also need to check into insurances. Are there any liens or loans on the building or equipment. Are there any hidden law suits waiting for you after you purchase and assume ownership of the business and building. Are there any furture construction activities that are going to take place such as widening of the streets that may affect the property. Are there any plans for other types of new construction that may impact you? Check with the building department to see if there are any new shopping centers that will be opening up in the near future that may draw customers away from you to a new pool hall. Also are there any plans to reroute the existing streeting near your business that may impact you.

All of these items I mentioned can hurt or maybe help you now and in the future. Hope this info. helps.