# Buying Business in Mallorca



## ukmartin (Apr 8, 2011)

I would like to relocate to Mallorca and have been enquiring about a business there. 

The business supplies goods to the licensed trade and the current owners say it is doing well.
Would like some feedback on the state of the tourist trade in Mallorca, do you think numbers are healthy or is it suffering badly due to the recession?

Any comments would be greatly appreciated

Martin


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## Joppa (Sep 7, 2009)

ukmartin said:


> I would like to relocate to Mallorca and have been enquiring about a business there.
> 
> The business supplies goods to the licensed trade and the current owners say it is doing well.
> Would like some feedback on the state of the tourist trade in Mallorca, do you think numbers are healthy or is it suffering badly due to the recession?
> ...


I'd have thought that given the number of bars that have closed and remaining owners desperate to sell up, the demand for bar supplies etc must be down, or competition is so strong that you barely if any make any profit. Mojorca isn't a year-round destination like Costas in the South of Spain, and unless your customers have a steady trade in the winter months catering to locals and resident expats, demand must drop off substantially in low season, needing another revenue stream to keep going.


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## xicoalc (Apr 20, 2010)

ukmartin said:


> I would like to relocate to Mallorca and have been enquiring about a business there.
> 
> The business supplies goods to the licensed trade and the current owners say it is doing well.
> Would like some feedback on the state of the tourist trade in Mallorca, do you think numbers are healthy or is it suffering badly due to the recession?
> ...


In my humble opinion (as a Business consultant), bar suppliers I know of are not doing well. The owner will of course tell you it is - he wants to sell. Right now, nothing is going to fetch its true worth, and with a few exceptions most business owners whos businesses are doing OK are hanging on to them until a time then can realise a decent price.

Why is he selling? I suspect NOT because he is doing well, but mroe because trade is down, things are not looking good and maybe some new competition has opened up or opening up and he knows it will have a knock on effect.

Having said that... I have a client in this business who actually is doing well BUT thats because he sells on volume to the BIG bars. His margins are tiny now and we had to work hard to streamline operations to keep him in the black while the current recession passes.

BE CAREFUL!


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## jojo (Sep 20, 2007)

I think you need to do some research in the bars etc that this company supply. See who uses him, how much they use, do they like him, do they owe him money, where does he get his supplies from, is he credit worthy, is he a "known" company? 

Apart from that, the recession is alive and well in Spain and its Islands!!! As Steve says BE CAREFUL! Dont take anything at face value

Jo xxx


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