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macleod101

What Is Key Money?

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The goal was simpler, not sexier. I can also do one with legos and toothpicks with jpeg images if you're still not catching on.

:D

That was great, Heng. You've restored my faith in American university Schools of Business. I recall that no accounting or business professor could deliver a lecture without widgets. However, I don't recall taking a course regarding used widget machines. It seems they only talked about the widgets themselves. :D

:o

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As for bargain basement rentals. I would say the rental mkt is crazy. Any shophouse is 200,000

Best thing is that if you find a business you want to buy, then go and do a deal privately between you and the owner, let the agent get his kicks elsewhere from another sucker. I will give you an example, a business I enquired about had a price of 3.5mil baht and I knew the owner through other avenues and we sat down and discussed it, he only wanted 2.5m baht actually for his business. Same would go for key money amounts and possibly not at all. Might not work every time, but worth a try.

Who knows maybe thru the agent you could have gotten it for 2 million Baht or even less. It’s the seller who sets the price, businesses like real estate is negotiable.

It is the agent’s job to find the price that makes both parties happy without making the buyer look bad on a low ball offer. We have had businesses sell for less than 20% of what the original asking price, every case is different. But on average most businesses are acquired at 75-80% of the asking price. 2.5 mil on a 3.5 mill asking price would certainly be the norm for a buyer.

The big advantage of a professional transfer specialist, is most would like assistance to draw up the written conditions on the offer of purchase such as review and acceptance of the financials, review and acceptance of the lease, no competition in a 5 km radius, no solicitation of the employees, no liens, etc.

They also would have had the security of escrow instead of trying to getting it back from the seller if the deal fall apart during due diligence. It worked out ok for you but for a number of folks, it was a life saver having a professional solving problems during the business transfer.

www.sunbeltasiagroup.com

Not quite right. The business owner told the agent 2.5mil, the agent obviously whacked on the further 1 mil for himself. So then the 20 to 30% rule would have come off of the 2.5mil.

Regardless, when you continue to quote key money and rental seperate and praise it as a good deal, you will never get my respect. Why dont you just offer a further great service to your 'transparent' activities and state what the real rental figure works out to be per month inclusive of this key money dealings.

What you guys support at the moment is like advertising a block of land for 5mil and then saying the house is an extra 10mil on top.

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Not quite right. The business owner told the agent 2.5mil, the agent obviously whacked on the further 1 mil for himself. So then the 20 to 30% rule would have come off of the 2.5mil.

Any agent that puts money on for himself like that, is worse than scum of the earth. :o

Why dont you just offer a further great service to your 'transparent' activities and state what the real rental figure works out to be per month inclusive of this key money dealings.

Never been an issue as it is rare to have key money involved with the business transfer. In almost cases we have been involved with it, the seller paid the initial key money and the buyer did not have this cost. The only single exception the buyer and seller split the initial key- money fee to the landlord.

http://www.sunbeltasiagroup.com

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