Location: Mesa, AZ
For Sale Website:
Hand Car Wash is a company for sale that is located in Meza, Arizona. The price for the car wash is listed at $465,000. Hand Car Wash specializes in cleaning cars by hand and detailing. The spreadsheet model contains the income statement, balance sheet, and other financial information that are useful to analyze the company. The model is easy to understand and to update if changes are made.
The return on assets for this business is -6.5% for the first year and the projections for year 8 has a return on assets of 11.6%. The return on equity is not very good. For the first year, the return is -161% because the net income and the equity is negative. The gross profit margin is high, but the problem is that the expenses are high; therefore, the net income is negative.
After analyzing this business, we came to the conclusion that it would not be a good idea to get involved in it. The amount of work we have to put in it is not worth the return that we are going to get. It would be worth it if the asking price was lower and if we had a constant customer base of at least 42 cars per day. By increasing the amount of cars per day, we are going to have to increase amount of labor work since it is a hand car wash and detail. The costs are going to be increasing more rapidly than the revenue.