The
Baked Bear franchise at Pike & Rose, and an option to open five additional Montgomery County locations, appear to be for sale for $1,200,000. An
online listing cites the franchise's gross revenue as $2,100,000. The Pike & Rose ice cream shop is often crowded, and scores highly in online customer reviews. It is the only Baked Bear location located east of the Mississippi River.
The notice is somewhat confusingly worded, but they appear to refer to a new location that has not yet opened, somewhere in Bethesda, rather than the one that is in Pike & Rose.
ReplyDeletePerhaps you could call them to clarify this?
I'd hate to see a repeat of Kaldi's or Tastee Diner.
Robert, does this mean you're buying into Baked Bear?
ReplyDelete6:14: How do figure a new location that hasn't opened yet was founded in 2017, has 10 employees and grossed $2 million already?
ReplyDeleteI certainly would hate to see a repeat of Kaldi's posting a false announcement that they were "closing their doors" online, too. Their words, their mistake.
Tastee Diner? I led the blow-by-blow coverage of the Tastee-Marriott negotiations to the point that other news outlets ranging from the Washington Post to Bethesda Magazine were forced to plagiarize my updates by describing exact figures I quoted as "rumors," without citing my website as the source. My reports were confirmed by Marriott spokespeople at the public meeting before a crowd of dozens.
I don't think you want to go there, chump,
Wait, did Robert report that Tastee Diner was closing? I was just there a few weeks ago. When was that? I didn't hear anything about that and business seemed to be doing well.
ReplyDeleteTD, I have never reported Tastee Diner was closing, and certainly you know no such report appeared on this site in the recent weeks you have been reading it (you stated you were a new reader to the site).
ReplyDeleteWhat I have reported previously, were the negotiations between Tastee's owner and the Marriott team a couple of years ago. Marriott obviously wanted the diner site, and the Woodmont Grill site.
They reached agreement on a price with Tastee, according to my inside source. But the deal was quashed by Woodmont Grill, whose building sits in-between Tastee and the Marriott site, because they were unwilling to sell.
So Tastee Diner is not closing anytime soon. However, the owner has stated that he is nearing the end of the line at all of his diners, most recently in the controversy over the Laurel location.
How can Robert call out others for not citing his website, but clearly did not credit Eater DC for the Jeni’s announcement? Selective journalistic values?
ReplyDelete7:01: I received a press release from Federal Realty, as I clearly stated in my report. Facts.
ReplyDeleteOverpriced. Who cares about revenues, it's profits that matter. The business has few assets -- just their furniture and the "goodwill" rights to the franchise. They don't own the real estate of they are in.
ReplyDeleteMy guess is earnings are $200-300k and that's with the owners working for no salary (taking dividends from profits). There's a reason they didn't list their earnings on their listing.
Also gross revenue of $2.1mln seems high, especially for a highly seasonal business. That's an average of $523/hour per day for the 11 hours/day they are open. Let's say average customer spend is $10. Are they really ringing up a customer almost every minute, from 11am-10pm, every day of the week?
I bet if you go sit there on a cloudy day like today, for an hour, and count customers, it will be under 5 per hour.
7:32am, thank you for your insight!
ReplyDeleteHow might someone typically calculate the sale price of a business? I heard something about a multiplier of the annual profit or something like that?
Looks like they made the "Best of Bethesda" list last month. So it's odd that they would want to sell now.
ReplyDeleteThanks for the insight Robert! The way it was sounding, someone made it sound like you recently had reported Tastee was closing and I was really confused.
ReplyDeleteTrue Fact: 60% of all restaurants fail within their first year.
ReplyDeleteI love the baked bear concept, so I hope they do well and expand further!
ReplyDelete@7:47 Usually it's a multiple of earnings, and then some adjustment (up) if the business owns a lot of assets, like their building. The furniture/kitchen assets aren't valued that much since custom items are difficult to sell and the used market has pretty low prices for the other stuff. That's why when restaurants go bankrupt, you often see the furniture and kitchen still left in there (and also a great way to start a new place -- lease one of those places so you have no costs on furniture or kitchen).
ReplyDeleteThere are a few cases where you can value based on revenues not earnings, in particular industries where the expenses are fairly even across all companies, but that's not as common. I think mobile phone carriers use a metric based on customer retention rate, average customer value, etc.