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Nov 18, 2019This is an opportunity to acquire the existing leasehold, furniture and assets of a popular luxury hair salon and hair design studio. The store is conveniently located in a plaza in Burlington with ample parking space and access to a large target demographic. The business is consolidating its operations to its other location and therefore selling its assets at a discount to fair market value. In addition, the seller estimates that a small portion of the salon’s current clients will not relocate to the new location. Consequently, the buyer can generate a residual goodwill of approximately $85,300 due to an estimated 25% customer retention from this acquisition. This is an asset sale which excludes inventory. In addition, the business name, branding and client lists will not be transferred to the purchaser. The current store facility is 1,050 square feet and has ten chairs. The location has an exclusive agreement for hair styling and lease terms can be renegotiated prior to closing. Fixed assets were originally purchased for $74,000 and have a depreciated book value of $48,000. The owner estimates that the fair market value of these assets is $62,000.

Discretionary income and consumer spending in Canada have risen consistently over the last five years and is expected to grow at an annualized rate of 2.8% over the next three years. As consumers tend to focus on beauty and lifestyle, a larger portion of this income will be spent towards personal care services such as salons and spas. This will boost revenue growth for salons and spas over the next five years.

This is a great turn-key opportunity for a hair stylist seeking to start their own business without having to invest in leasehold improvements or brand-new equipment.

Transaction Information:

Asking Price: $49,900
Original Cost of FFE $74,000
Fair Market Value of Assets: $62,000

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