Business & Franchise Lawyers
Since 1996

Call Today for Help
(800) 976-4904
Contact Form

Buying a Car Wash In NY or NJ: Learning From a Deal that Went Bad

Date: 11/19/2011 | Category: Business Transactions | No comments

This past week a great client closed on the purchase of an automated car wash. Although this transaction closed promptly and went extremely smooth‚ this deal was preceeded by a transaction that‚ ultimately was just not good for my client and was anything but smooth.  In fact‚ the prior transaction‚ unnecessarily‚ involved an eight month process and‚ ultimately‚ fell apart at closing.  I know the client is glad – really glad – that the prior deal fell through.  Having gone through this process‚ here are some thoughts that I have for prospective car wash purchasers:

  • Every Car Wash Transaction is Different.  As an experienced attorney with car wash transactions‚ I can certainly tell you that no two deals are the same.  There are many variable factors that make each transaction slightly different and will require that both you and your attorney modify your due diligence efforts.
    • Some variables that will alter your efforts‚ include:
      • Automated versus Hand Car Wash;
      • Lease versus Purchase of Underlying Property;
      • Whether or Not the Seller will Be Financing a Portion of the Purchase Price;
      • The Township and Locality and Rules Respecting Expansion;
      • If you Are Leasing the Property‚ whether or Not the Landlord has a Mortgage on the Property.
  • Walking Away From a Deal is Not a Bad Thing.  Sometimes deals dont work out.  I am not talking about unnecessary paper delays that some attorneys sometimes cause but rather real substantive issues that should not be overlooked.  Even if you are minutes from finally closing on your deal don't over look problems and always be prepared to walk away. For example‚ are all the seller's liens satisfied?  Is your lease adequately protected? Have you obtained Proper Assurances from the landlord's mortgage holder?

For my client‚ walking away from "the bad deal" will probably make all the difference in the success of the business that he finally closed on 12 months later.  Sometimes delays and "dead deals" happen for a reason.

LEARN MORE (Before You Sign a Contract):

Order a complimentary copy of Charles N. Internicola's Book:  "An Entrepreneurs Guide to Purchasing a Business" 

Related Articles:

Leave a Reply: