What should I check before buying a music store?

A music store is a retailer, and it works differently from a lesson school. Its value to a buyer sits in instruments on the floor, rentals out in homes, a repair bench and the accounts that supply it. Each of these can look fine in a summary and prove thin on inspection. Go through them one at a time and ask for records, not just explanations.

Stock: aged, consigned and owned

Walk the floor with the inventory list in hand. Ask how long each major piece has been in the shop and which instruments are on consignment, since those belong to someone else. Older or unusual stock may sell slowly, so ask how the owner handles it. If you are weighing a teaching business instead, see what to check before buying a music school. Read the inventory statements with your accountant.

Rental fleet and repair bench

Ask what the rental records show, especially for families of beginning students. Ask for the list of instruments out on rental, who holds each agreement and how many have gone unreturned. At the repair bench, find out who does the work. If the owner is the only technician, ask whether that person would stay on, or whether you would need to hire one.

Dealer accounts and school band customers

Many supplier relationships are dealer accounts held in the owner’s name, and a supplier may need to approve a new owner. Ask each major supplier early. School band programs can bring a large share of a shop’s business, so find out which relationships are with the owner personally. Also ask how much the shop sells online, and whether those sales depend on the current owner.

Questions to put to the seller

• Which instruments and accessories are consigned, and from whom?
• Which dealer accounts can transfer to a new owner?
• Who are the school and teacher customers, and who manages them?
• What would it take to replace the owner at the repair bench?