Nishit, what are you doing yaar? It was seemed a Gujarati analysis, but conservative.

For grocery stores the Cigarate sell is mostly 40-50 percent, with a margin of 18 percent to 25 percent. Rest of the Items are about 40 percent. So on an average you can look for a a return of 30 percent. Now the profitability depends on the rent and other expenses (TMI) as it is called. Higher it is, less the profit is.

The working hours are also important, as Chandresh mentioned stading all day could be difficult. But Chandresh which labour job is without standing?

Without any credit history you might have hard time to get any loan. You might look for partner already settled in Canada and having good credit history. That way you can get a business of 100K, that should give you annual return of atleast 50K as a owner and operator. If you have employees you have to subtract the salary.

Which place to choose for doing business? Well, if you are looking for videsee business like subway, pizza or convenience stores you should not even think about buying it where there are tons of desis. There are no good such businesses in and around toronto just because of our population. One reason is - we don't buy those stuff quite often, but the main reason it, we desis are looking for businesses more than they are available and so the price we pay for buying a store is always high. If we look for same business in Barrie - 1 Hour north of GTA, it will always be 25 percent cheaper.

If you are thinking about strating Indian item, than ofcouse you have to live in "555 Brimorton Drive, Scarborough, Toronto"

You are right - it is better to bace pizzas than learning EJB and .NET. Please let me know your success and I will join you!

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A Proud Indian Canadian

Gravo Gujarati,

Your advice is really good and valuable. However your assumption about lack of good businesses in the GTA may not be correct. There are a lot of good businesses available in the GTA and its here that one makes higher sales turnover compared to Barrie or far away suburbs.

The sale of business has every thing to do with return on investment . This is calculated by verifying the gross sale less cost of goods, expenses, rent, taxes, maintenance and insurance, no. of employees etc. The buyer of business mostly ends up paying for goodwill in addition to other costs and the same is in direct propotion to the amount of net profit.

Any business can be good from your list of subway, pizza or convenience stores as long it satisfies a good ROI.

When buying a business one should work with a professional real estate person. Buyers normally do not pay any commission to the real estate brokerage in Canada and the realtor safeguards their interest with professional advice, mortage approvals, rules, laws, clauses, conditions and submission of offer.

Regards,

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Amit Kalia, Broker, REALTOR®
RE/MAX Real Estate Centre., Brokerage
independently owned & operated
100 City Centre Dr, Unit 1-702
Mississauga, ON L5B 2C9
Phone No.: 905-339-5111
Website: https://www.realestate-ontario.com/
Condo Blog: https://condopundit.com/blog/

Dear Garvo & Amit,

Thanks a lot 4 ur valuable advise .

Though I may not take it as an immediate landing option but would surely concentrate and divert my mindset in making and establishment on a small scale . I think its worth it .

50 k personal plus 50 k loan = (100k) ~ annual income of 40k . Thats like 3.2 K per month which I dont think is bad for a living !!!! Of course business means loss 2 !. The other day I was reading an article on the \"comfortable lakhpati\" status of small time shop owners @ ITO and major crossings ---- namely the Fruit Juice stall kinds .

I think this alternative pre occupation can not only save us 4m labor jobs , but give a better ROI (as pointed by Amit ) if we put in the same labor . Besides giving us some sense of security of having our own business. Hope this thing works on the long term settlement basis 2 .

Wonder what incentives / sops does the Canadian Govt provide 4 self employed people . I m sure that a no. of Candian Desis r looking @ the viability already .................

Thanks guys ,

Manasvi

The cigratte at costco are available for $ 46 a carton and are sold at 56 a carton or 8.20 for large and 6.99 for small( the place where i work) and even less at times. for most brands.

The 649 lottery machine if available has 7 % gross margin on sales and is generally a very large chunk of sales.

daily sales for a store availble for 125,000 will be around 1000 a day.

the other mercandise if bought thoughtfully from sale at big stores will give 100 % and above margin generally ;if bought from cost co still margin are around 60-70 % .

expenses are already discussed earlier.

Profit comes from goodwill when the store is sold .(there is no tax on capital gains upto 500,000 in Canada);check details some rules apply tough.

One can make good margin if one knows how to run a cash register.
I hope i have cleared a lot of doubts

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Sucess is not an accident it is a result of hardwork with intelligence.

Nishit,

According to my understanng, since I had actually put in bid for such a store, the purchase price of a grocery store should be around 10 weeks' sale, premium depending on a location which will grow in FUTURE (not present, that is aleready priced in).

To my surprise, I was given the same calculation for Canada, USA (where one of my school friends has 3 such stores), and even Australia (where my brother has done intense research on the subject and bought one).

So when you say the sales of 125,000 store should be $ 1,000 per day would not be feasible or viable option. I had put in a bid of 180 k for a store having average sale of 90 k/month in last 6 months and it finally got sold for 200k. Yes ofcourse, that does not include the price of inventory - but in such businesses, inventory is always a separate settlement.

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Chandresh

Advice is free – lessons I charge for!!

I am not aware about any incentive from government for self-employeed directly, but taxes is the main consideration. Almost 90 percent small shops are owned by asians (chinese, iranies, iraqies, afgani, pakistani, indian etc...) As you are owning a business, you can deduct your expenses first and than pay tax, where as in job you have to pay taxes first, so that makes lot of difference.

Amit can throw more lights on that.

Amit, I know there are businesses in Toronto. They might have good ROI, but I am talking about the demand supply theory. For example, Subways. There are 1000 new applications they are getting per week from Toronto Only. This makes the price of business on heigher side. Also in Toronto there are number of refugees, and some immigrants not having status in US came to Canada for getting status, but having big $$$ from US. They have increased the price considerable. I have many relatives owning subway in US and the price we are paying here in Toroto is way high!!!

My 2 paisa on the subject I don't know much!

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A Proud Indian Canadian

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Orginally posted by nishitno1
The cigratte at costco are available for $ 46 a carton and are sold at 56 a carton or 8.20 for large and 6.99 for small( the place where i work) and even less at times. for most brands.

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The 649 lottery machine if available has 7 % gross margin on sales and is generally a very large chunk of sales.

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daily sales for a store availble for 125,000 will be around 1000 a day.

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A Proud Indian Canadian