Should I buy an existing water store or open a new one?
An existing water store gives you an installed treatment system, regular refill customers, delivery accounts and a known location. A new store gives you your own choices of equipment and site but starts with none of that. Neither is right for everyone; the better fit depends on your time, cash and appetite for risk.
Both paths lead to the same kind of shop, so the choice is mostly about what you want to carry on day one. An existing store comes with equipment, a customer base and some history. A new store comes with a blank page. Neither answer is the right one for every buyer, and this page does not recommend one. It lists what each side hands you so you can weigh them against your own plans.
What an existing store hands over
You take over an installed treatment system, dispensing machines, bottle and jug stock, regular refill customers, delivery accounts and a location people already know. You may also get supplier terms and staff who know the routine. Ask which of these the sale actually includes, and in what condition. Equipment that looks fine can be near the end of its life.
What starting new asks of you
A new store means choosing a site, signing a lease, buying and installing equipment, arranging water testing and building a customer base one refill at a time. That takes time before the store earns steadily. On the other hand, you choose the equipment and the layout, and you do not inherit someone else’s habits, old stock or disputes.
Questions to put to yourself
- How long can you wait before the store pays you something?
- Would you rather inspect a running business or design your own?
- Does the existing location suit where customers actually live and drive?
- Do you have the technical comfort to look after a treatment system?
How to compare fairly
Ask the seller for monthly sales by stream, equipment records and the lease. Then sketch what a new store would need and compare the two on the same page. Your accountant can help you set out the cash each route calls for, and a lawyer can review the lease or the sale agreement. For a similar weighing in another trade, see buying an existing grocery store or opening a new one.
Related reading
15 pages on the same subject, grouped by topic.
Buying
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Due diligence
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernment13 terms you need to understand before signing your commercial real estate lease
- 03Business Development Bank of CanadaGovernmentEquipment purchase financing for entrepreneurs
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