3000-6000 BTC loan - Hookah Lounge - 9/18/12 Update

[Monster-Ant]

There, second bullet point of yours.  I never said I would only be putting up decorations, seriously?

Really?

The facility is very nice as is, there's no need to spend that much remodeling.  The only 'remodeling' I'm going to be doing will be putting up decoration, room dividers and furniture.

https://bitcointalk.org/index.php?topic=106496.msg1173840#msg1173840

Here's the spreadsheet, please note, this is a live spreadsheet, so I can add variables over time such as taxes, licenses, insurance or permits.  This spreadsheet calculates profitability with 96 customers/day in groups of four, average, for two hours each.

That spreadsheet is what you've been holding back?

Would you like me to do a line per line here, or just comment on the spreadsheet?

That spreadsheet isn't at all what I expected. To be honest, Dank, I expected a lot better from a man of your claimed intellect.

To be honest, that isn't even acceptable as a weekly business record.

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[Monster-Ant]

I think maybe you should do that before seeking investors.  There is not enough data for a decision here.

That is not up to you to decide, but the actual investor.  Please stop spamming my thread with your negativity.

Please define what the hell you mean by negativity.

Seriously, the only thing that you seem willing to accept is OMGZLETMEFUNDYOUNOWZES!

I'm trying to point out to you things you NEED to know. I'm even willing to tell you what's wrong with your spreadsheet, and you keep covering your ears and screaming I CAN'T HEAR YOU!

Have you done ANY research regarding sales tax, taxes, title costs, fees, deposits, or ANYTHING?

Have you even GLANCED at the labor laws?

[dank]

There, second bullet point of yours.  I never said I would only be putting up decorations, seriously?

Really?

The facility is very nice as is, there's no need to spend that much remodeling.  The only 'remodeling' I'm going to be doing will be putting up decoration, room dividers and furniture.

https://bitcointalk.org/index.php?topic=106496.msg1173840#msg1173840

Here's the spreadsheet, please note, this is a live spreadsheet, so I can add variables over time such as taxes, licenses, insurance or permits.  This spreadsheet calculates profitability with 96 customers/day in groups of four, average, for two hours each.

That spreadsheet is what you've been holding back?

Would you like me to do a line per line here, or just comment on the spreadsheet?

That spreadsheet isn't at all what I expected. To be honest, Dank, I expected a lot better from a man of your claimed intellect.

To be honest, that isn't even acceptable as a weekly business record.

Finish the sentence, at least.

Thank you for your input, I recognize there's a lot of work to be done, which will begin after I talk to my lawyer and SBA.

[kentrolla]

dont worry guys. he will make it all work out because hes super intelligent and the best wishful thinker known to man.  

poor kid, reality is going to hit him hard

[dank]

dont worry guys. he will make it all work out because hes super intelligent and the best wishful thinker known to man.  

poor kid, reality is going to hit him hard

What's with the hate?  If you don't have anything positive to add, to help me make this happen, please, do not post.

[kentrolla]

I'm trying to point out to you things you NEED to know. I'm even willing to tell you what's wrong with your spreadsheet, and you keep covering your ears and screaming I CAN'T HEAR YOU!

Well, this is the best thing to do if you have his view on how the world works. You are getting in the way of his much needed dose of optimism. As long as he believes it will happen, It will happen.

[Rarity]

If you don't have anything positive to add, to help me make this happen, please, do not post.

The answers to the questions you have been asked are what will or will not make this happen.  The questions themselves are neutral.

[Monster-Ant]

Room dividers, furniture, and decorations are not even close to what all you will need. I can go indepth, but I have a feeling you'd consider it negativity.

First, let's look at your employees.

You say 3 for weekdays, we'll assume 40 hours a week. Now, that's 3x40=120*8=$960/week BEFORE you get into your unemployment insurance, L&I insurance, and other costs to hire someone.

Then you have 5 employees for the weekends, we'll assume 8 hours a day for 2 days for 16 hours at $8/hour. That's 5x16=80*8=$640 for weekend employees.

960*4= $3840 per month in weekday employee wages.
640*4=$2560 per month in weekend employee wages.
That's $6400 per month just for base employee wages.

For your monthly expenses, you have $500 listed.

Your WAGES go over that.

Electricity, I'll put just slap down a fairly low electric bill for a business: $250.
1 Phone Line + 1 Cable TV + low-end internet for Wifi = $100

Your expenses, even without product replacement and equipment damage replacement and taxes, insurance, fees, and the like:

Roughly $6,750.

Are you starting to see the flaws in your numbers? That's without even factoring in any insurances you have to have, paying into unemployment and FICA and SSI.

Dank, there's a LOT more that you need to have information on. That spreadsheet isn't worth anything. There's no actual costs in there, there's no realistic expenses in there.

If you had the answers to all of my questions, believe me, your spreadsheet would look a LOT different.

[TheBible]

Your post is full of misinformation and negativity.  Why did you spend so much energy on me if you're not interested in investing?  I don't care about what you did to become successful, this is what I'm doing.  I'm talking to my lawyer, tomorrow.  I'm getting counseling from SBA or a local college for the business aspect.  I'll then be forming a budget over this week.  Then, I will get a loan and proceed to open my hookah lounge.

I have the perfect opportunity here, I really just want to do business.

If you aren't willing to take advice from someone with more experience, you are going to fail.

I'm sorry but ~positive thinking~ is not enough to make a business successful.  We've seen your spreadsheet and your plans, and you are woefully unprepared.  If you find that negative, too bad.  It is a solid fact.  You are not prepared for this venture.  The fact that you think you are does not alter reality.

[BorderBits]

How in the world are you figuring your traffic and your "multipliers"?  Have you even calculated what the minimum traffic you would need to break even? 

[TheBible]

I think maybe you should do that before seeking investors.  There is not enough data for a decision here.

That is not up to you to decide, but the actual investor.  Please stop spamming my thread with your negativity.

You have no investors because you can't understand everyone asking you questions is a potential investor.  You brush them off, expecting investors to just throw you money, no questions asked.  Since you won't answer any, of course no one will invest in you.  You unwillingness to accept criticism only hurts you further.  You are proving yourself to be difficult and frustrating to work with.

Get this through your head.  All investors are going to ask these questions before they invest.  A few probably already have, and you chased them off.

[BorderBits]

So, if your calculations are correct, that would leave $8,282.64 monthly profit.

I do not see the problem.

Unless your calculations of revenues are off by $8,282.64.  Seeing as how your revenue numbers were pulled completely out of your ass, I'd say that there might be a problem.

[kentrolla]

dont worry guys. he will make it all work out because hes super intelligent and the best wishful thinker known to man.  

poor kid, reality is going to hit him hard

What's with the hate?  If you don't have anything positive to add, to help me make this happen, please, do not post.

It's not hate. I'm actually trying to help you. I have first-hand experience on what happens when someone ignores reality and refuses to accept any negativity.

Let me explain. I lost a friend that was like you. He took way too many drugs and started to believe the world revolved around him and reality would just become whatever he believed.  It was VERY annoying, and he became no fun to hang out with anymore. This all came crashing down on him really hard when reality finally kicked in. When people would try to help him, he would think they are actually just challenging his beliefs. He lost all of his friends and loved ones because he saw everyone as an enemy because they didn't believe him to be the "god" that he claimed he was. He made claims that he could time travel and control people's minds.  obviously these claims were not true, but I'm convinced that he thought they were true.

Drugs are bad. mmkay?

Sometimes, a little dose of negativity can be a good thing. That way when your ego trip ends it won't be so bad.

[TheBible]

dont worry guys. he will make it all work out because hes super intelligent and the best wishful thinker known to man.  

poor kid, reality is going to hit him hard

What's with the hate?  If you don't have anything positive to add, to help me make this happen, please, do not post.

You don't want people to help you make this happen, you just want to them agree that you've done everything right and throw money at you.  You are not at all interested in honest criticism or help.  You're getting valuable advice on very real costs you have not considered from people who have been where you want to be, and you are just dismissing out of hand.

Of course, knowing bitcoin, you'll probably just run off with whatever anyone gives you anyway.

[Monster-Ant]

So, if your calculations are correct, that would leave $8,282.64 monthly profit.

I do not see the problem.

Except my initial calculations (the $5K) were WRONG!

That's just EMPLOYEE WAGES, phone, (shitty) internet, 1 cable outlet, and a lowball $250/mo electricity.

That's without counting:

Unemployment insurance for EACH worker.
Federal/State payments for EACH worker.
Fire/Flood/Smurf Attack Insurance payments.
Monthly loan installments.
Replacement of broken/damaged equipment.
YOUR pay. (You do NOT get to take whatever you want out of the business to fund your life, unless you WANT your business to fail, you need a set wage)
You mentioned having juice/soda/snack. That racks up REALLY quick. You don't even have that.
How is your shisha/coals expenses figured? I looked, and it's not even broken down, with lists for how much you'd have to order per week/month vs how much would be consumed.
Advertising expenses
Cleaning supplies
Water/Sewage/Garbage

And how are you getting your profit, how many customers you will get at any given time? Are you following the practical mathematical formula or just grabbing numbers out of what you hope for?

This is NOT negativity, these are questions that you NEED to know the answers to.

EDIT: It's not even a correct balance sheet!

Dank, have looked at examples of balance sheets? Any intelligent person can figure out how to do the multi-tier accounting needed for working balance sheets. There's 70 year old women running craft shops who use multi-column accounting, I'm sure you can do it too.

If you showed that sheet to the IRS, they'd laugh at you right before they slapped that big red AUDIT button on you.

[dank]

dont worry guys. he will make it all work out because hes super intelligent and the best wishful thinker known to man.  

poor kid, reality is going to hit him hard

What's with the hate?  If you don't have anything positive to add, to help me make this happen, please, do not post.

It's not hate. I'm actually trying to help you. I have first-hand experience on what happens when someone ignores reality and refuses to accept any negativity.

Let me explain. I lost a friend that was like you. He took way too many drugs and started to believe the world revolved around him and reality would just become whatever he believed.  It was VERY annoying, and he became no fun to hang out with anymore. This all came crashing down on him really hard when reality finally kicked in. When people would try to help him, he would think they are actually just challenging his beliefs. He lost all of his friends and loved ones because he saw everyone as an enemy because they didn't believe him to be the "god" that he claimed he was. He made claims that he could time travel and control people's minds.  obviously these claims were not true, but I'm convinced that he thought they were true.

Drugs are bad. mmkay?

Sometimes, a little dose of negativity can be a good thing. That way when your ego trip ends it won't be so bad.

When will your ego trip end?

Please stay on topic.

Room dividers, furniture, and decorations are not even close to what all you will need. I can go indepth, but I have a feeling you'd consider it negativity.

First, let's look at your employees.

You say 3 for weekdays, we'll assume 40 hours a week. Now, that's 3x40=120*8=$960/week BEFORE you get into your unemployment insurance, L&I insurance, and other costs to hire someone.

Then you have 5 employees for the weekends, we'll assume 8 hours a day for 2 days for 16 hours at $8/hour. That's 5x16=80*8=$640 for weekend employees.

960*4= $3840 per month in weekday employee wages.
640*4=$2560 per month in weekend employee wages.
That's $6400 per month just for base employee wages.

For your monthly expenses, you have $500 listed.

Your WAGES go over that.

Electricity, I'll put just slap down a fairly low electric bill for a business: $250.
1 Phone Line + 1 Cable TV + low-end internet for Wifi = $100

Your expenses, even without product replacement and equipment damage replacement and taxes, insurance, fees, and the like:

Roughly $6,750.

Are you starting to see the flaws in your numbers? That's without even factoring in any insurances you have to have, paying into unemployment and FICA and SSI.

Dank, there's a LOT more that you need to have information on. That spreadsheet isn't worth anything. There's no actual costs in there, there's no realistic expenses in there.

If you had the answers to all of my questions, believe me, your spreadsheet would look a LOT different.

Please review the spreadsheet again.  You just recalculated my numbers.  Monthly expenses are random expenses that are not charted.  The wages are deducted from the profit.

Monster-Ant, I've already said, countless times, I will be adding variables into the spreadsheet with time.

[dank]

I updated the spreadsheet, there was an error.  When calculating random monthly expenses, I was calculating 4x more than I should have.  This brings the gross profit up to $15,132.64/month, up from $13,632.64.

http://www.2shared.com/file/Q-8dMLoz/hookah.html

[jwzguy]

Dank, you should listen to this guy instead of getting defensive. Regardless of whether you believe his motives or not, he's spent a lot of energy to point out things you'll absolutely have to address in order to start this business. If you refuse to discuss them, you make yourself look bad to potential investors.

I don't know why he's trying so hard to get through to you when there is likely no benefit to himself, but if you're smart, you'll take advantage of it. Any lawyer or consultant worth talking to would charge you through the nose for doing this.

[Monster-Ant]

OK, troop, lemme see what I can do to untangle this crap.

Let's look at your income section:

Item	Quantity	Cost/Price
People/session	4	25
Sessions/hour	6	150
Hours/day	8	1200
Hours/session	2	600
Sessions/day	24

All right, this is a damn mess. Let's try to break it down.
First of all NEVER have your cost/price on the same column, or quantity in/out on the same column.

So, you will be open 8 hours each day.
Each session will be estimated at 2 hours.
You are hoping for 24 sessions per day.
That means you have 6 stations. (We aren't going to bother with that "multiplier" crap, you ALWAYS assume worst case scenario)
You are assuming 7 days a week operation. (No holidays, not taking into account college breaks/testing times/activities)

So, let's assume maximum occupancy for your six stations, and break it back to 5 days a week.
We will assume an average of 2.5 (from a max of 4) people per session. (Some will be alone, others will be a full party, you average it out and hope for the best)
We will assume that you have made it policy that they will be charged per session or part of a session, so 2 hours 15 minutes will be charged as 2 sessions.

So, that gives us 4 sessions per day per hooka. Now, that probably won't happen, as there will be cleaning times, airing times, reloading times, so there WILL be times that each hooka will NOT be making any money. Let's be more realistic, and go with 3 sessions per hooka with 15 minutes of cleaning after each use and 15 minutes of down time. (It will RARELY happen like that, people are not robots)

So, 3 sessions per day.
Each session will be composed of 2.5 people.
So, that's: Hooka rental, bowl rental, per person.
Each of those is $5, so it'll come out to $17.50 per session.
That comes out to $52.50 per hooka per day.
With six hookas that comes out to: $315/day.
Or: $1575/week

Not to mention you'll need a minimum of 12 hookas so that they can be cleaned according to regulations, since anything that came into contact with bodily fluid (such as saliva) has to be sterilized, and add another 1/3 of the total for breakage so you aren't down one while waiting for shipping. So you'll need 16 hookas. And only 6 are at use on the floor.

But, you have a gross profit, at this time, of $1,575 per week.

Shall we begin looking at your weekly expenses?

(Anyone wanna check my math? I did this all off the cuff, since I don't have to worry bout actual accounting here. I'm just using it as an example)

[kentrolla]

you're putting way too much effort in trying to help someone who can't be helped.