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Selling Shop Tools7/12
After 35 years as a custom and commercial cabinet shop I've decided to start the wheels of retirement in motion. The Building is going up for sale and I will slowly wind down the existing work in progress. I have somebody interested in the equiptment for starting a cabinet business and trying to figure a decent price for me to sell and the buyer to pay. All equiptment is in good working order so can i figure .40c on the dollar. As compared to them paying full price?
If you can sell everything in one shot, $.40 would be a great deal. I sold a few machines for more, sold a couple for less, and after sitting in my garage for 2 decades some oddball stuff will finally be going to the scrap yard.
If you can get 40 cents on the dollar for your equipment, I think you are doing very good. If he is starting a cabinet shop, why not sell him your business? You could stay on for a year or two for a smooth transition and get something for the business as well.
One man bands/shops do not fare well in the "selling the whole business" category. The problem is that the buyer eventually figures out he/she can buy the tools/equipment and have 95% of what you have. The rest is blue sky, and if you can sell that, more power to you.
One man shops can do the best by cashing out as the OP mentions, or getting a dedicated employee and sell to him on contract. Plan on working for a few more years, as an employee, to keep him on track and insuring the contract sale continues over time.
I would do some research at dealer web sited to see what they get for used equipment. When you say ".40 on the dollar, are talking about what you payed for the machine 20 - 30 years ago or todays comparable price for a similar new machine? I think 40% of a same, new machine is too cheep to start at. I think you should be more like 66% then negotiate down. I receintly started looking at wanting another door/face frame clamp table. I Went to Ritter to find out what new would cost today. The table I had quoted is $10,000.00. I paid $3,200.00 for the same machine in 1995. Today I would be thrilled to get a used one or my old one back for $6,000.00 - 6,500.00