Posts
892
Joined
9/27/2006
Location
Humboldt, CA
US
I own a commercial sign shop/ outdoor advertising company. I've been going over my business numbers and have come to a conclusion that I could maybe split my company into two companies, the sign shop and the outdoor advertising company. As it is right now I work my ass off, usually 50-60 hours a week. I'm on the phone at least 4 hours a day and constantly running full throttle. I do generally enjoy running my business though and am grateful to be my own boss. But would love to not have 30 people demanding shit from me all day long.
Fourtently I've done very well so far, I bought the business in 2012, it's gross sales was around $380k a year. I'm now doing around $1.7 mil a year in gross sales.
I take home around $150k in salary a year and being as I own the business have been able to receive around $180k in benefits a year. (New "work" trucks, skidsteers, gas, health etc)
So here's the question, if I split the company my billboard side nets around $165k a year. I can keep this company, for work load I'd probably put in at most 10 hours a month to keep it running and my boards sold. Ideally I could sell the sign shop for a pretty good price and invest that in places as well. But I'd be giving up $160-$200k a year.
I'm young, only 32 with two little kids. I own 5.5 acres outright and am just finishing my house on it, I'll probably have a mortgage of $350k on a $800k house /property.
Am I stupid to want to give up $160-200k a year to not work? Basically if you had a choice between working your ass off and making $300-$350k a year or pretty much just chilling and making $165k what would you do?
Fourtently I've done very well so far, I bought the business in 2012, it's gross sales was around $380k a year. I'm now doing around $1.7 mil a year in gross sales.
I take home around $150k in salary a year and being as I own the business have been able to receive around $180k in benefits a year. (New "work" trucks, skidsteers, gas, health etc)
So here's the question, if I split the company my billboard side nets around $165k a year. I can keep this company, for work load I'd probably put in at most 10 hours a month to keep it running and my boards sold. Ideally I could sell the sign shop for a pretty good price and invest that in places as well. But I'd be giving up $160-$200k a year.
I'm young, only 32 with two little kids. I own 5.5 acres outright and am just finishing my house on it, I'll probably have a mortgage of $350k on a $800k house /property.
Am I stupid to want to give up $160-200k a year to not work? Basically if you had a choice between working your ass off and making $300-$350k a year or pretty much just chilling and making $165k what would you do?
The time spent with your kids is quality and they will remember it. Years go by fast, so take advantage NOW.
Some advice from an old guy.
The Shop
Split the businesses, sell the one and invest the proceeds. You won't make as much $ but you'll still be benefiting from the move and working fewer hours.
Sounds like you want to reduce your workload. Take that money and invest for retirement. Life is short.
I guess the decision to sell would depend on what "pretty good" is.
Another factor is if the buyer is paying cash.
An American investment banker was at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellowfin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.
The Mexican replied, “Only a little while."
The American then asked why didn’t he stay out longer and catch more fish? The Mexican said he had enough to support his family’s immediate needs. The American then asked, “But what do you do with the rest of your time?”
The Mexican fisherman said, “I sleep late, fish a little, play with my children, take siestas with my wife, Maria, stroll into the village each evening where I sip wine, and play guitar with my amigos. I have a full and busy life.”
The American replied, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat. With the proceeds from the bigger boat, you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing, and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually New York City, where you will run your expanding enterprise.”
The Mexican fisherman asked, “But, how long will this all take?”
To which the American replied, “15 – 20 years.”
“But what then?” Asked the Mexican.
The American laughed and said, “That’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions!”
“Millions – then what?”
The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siestas with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”
Anyone wanna move to Humboldt and buy a sign shop??
Will selling the sign shop net you enough to pay off all your debt? Will it put you some money in the bank? Or will you have that 350K mortgage with no real money in the bank? How much are property taxes on that 800K property? Home, auto, health and life insurance? Utilities? Can you swing it all on $165,000.00 a year that will still be taxable income? You have state income tax out there as well, correct?
Pit Row
The 165k would be more than enough to sustain my currrent lifestyle. I just had a long discussion with a friend whose pretty savvy in business, he's strongly advinging that I keep the business and hire a foreman to substantially lower my workload. There is a lot of detail in it but he has a very strong argument for doing that.
We'll see I've got a solid 6 months lined up of some pretty good jobs, so I'm doing anything yet.
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