Help with ROI??

Hi everyone,
Im in the process of buying a bread route and I'm not good with numbers and profit and loss projections and stuff but I was wondering if I could get some free help with this topic? ROI, return on investment, I don't quite get it exactly and I don't get Pnl either so any help I would appreciate it, I searched online and I still don't understand it??
Please pm me
Thanks guys

 

Don't do it.

 

Why's that??

 

Friday isn't until tomorrow

 

You'll probably lose all your money. If these things are overwhelming for you then buying this business is probably not a good idea.

 

If you don’t understand the lingo, it’s probably not a smart idea… especially after googling with no success on the simplicity of ROI and PNL. I’m not trying to be mean, just trying to help as you asked.

Matter of fact is someone probably holds your route in a pyramid scheme type situation. You bought it from them, you do the work and you pay them for the route. They pay another person, that person pays another.

Unless you’re working directly with a distributor, don’t do it.

 

Bread route?

I assume this is a brand name or ???

DIY the whole way?

I can help a bit, but seems like there may be a standardized workbook in place so not to get lost in the details.

For example Amsoil is EASY. Only need to keep track of COGS for local sales, income from those sales and any deductions of course. All my online Amsoil does the work and sends me a monthly check (with zero WH)

Sick Bike Parts LLC major PITA at first, still not easy 14 years in. I hate keeping the books, going to close shop this year and enjoy life more.........

You will have spoilage. Probably a decent number. You will need to decide on how you want to handle that, I'm guessing.

 

Are you borrowing money to finance this business? Regardless. A high percentage of new businesses fail in a few years because they are undecapitalized. That is they run out of cash and borrowed money.

ROI. Determine how much you will make from the businesses. Subtract taxes, operating expenses (e.g., capital equipment, salaries, insurance, etc). If there is money left over this is a positive return (generally good, how much leftover depends on how good).

An example of a bad ROI is people that borrowed money for school and get degrees that does not allow them to pay the debt back. A negative return. Generally bad.

 

So, the loafs of bread on the shelfs at the grocery stores are stocked by 3rd party people, not the store itself. It's kinda like consignment I guess? You "buy" the bread route (i.e. the right to stock the shelfs at that store(s)). I don't know exactly how it works, but I had a friend in the bread delivery business and he done well for himself, but like was said above if you're not working directly for distributor it may not pay as much. Not sure if this is what you were asking.

 

Yes pretty much paints a better picture.

Avoid. Maybe.

How much for the route? Truck? (You can't use your Prius) No storage involved I HOPE.

How binding is contract? (ALL ways)

What other expenses?

What kind of margin are they giving?

Huge up front, small margin, plenty of risk............

ROI may be the least of the worries here, IMHO.

 

depending on how much capital you are throwing at this, how much leverage you will use to finance continued operations, and how much you are able to to lose without being forced to live in a cardboard box (that answer should be 100%), you should probably consult an accountant if you dont know how to dissect a P&L. And not a mom and pop book keeper your friend knows, you need to consult someone who has actual controller level experience. Be very weary about over paying for this. Is it literally just the route? Is it the whole business? Does it come with assets? Why is it up for sale?