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Thoughts?
Owner wants circa 50k, includes all stock, shop fittings etc.
£400 a month in rent, no business rates.
Looks like it does a decent trade in repairs with bike/part sales a secondary concern.
Location wise its a bit hidden, but is quite close to a main commuter route and student areas.
I'm in the enviable position that i have the cash and can also consult for the company i currently work for, so the shop wouldn't be the sole source of income.
Am I mad?
"If you want to make £1M out of owning a bike shop... start with £2M" - said someone famous, once, or an approximation of this.
Dunno, I know a couple of bike mechanics, not sure they love it tbh.
Why's he selling would be my first question followed by a very close look at the books.
Retirement is the main reason stated.
Thoughts?
Get someone to value the stock and the shop fittings independently.
Otherwise , whats to stop you buying £40k of stock and shop fittings and renting somewhere else for a similar monthly amount and achieving the same thing but for ten grand less?
Can you start your own bike shop near by spend 30K on stock and go from there?
120k a year turnover for the last 3 years according to accounts
Lol PP beat me to it
Don't do it unless you have a firm business plan, which includes some good brands. I know a guy who has a small shop and for years he's been teetering on the brink of faliure, depressed as hell and making very little money from repairing bikes and selling a few accessories. His problem is that he's too small for any of the major brands and they don't want to upset their existing distributors. You will never make good money repairing bikes because you will never be able to charge what it really costs and to add insult to injury people will buy parts off the web then expect you to fit them.
120k a year turnover
gross profit?
120k a year turnover for the last 3 years according to accounts
And profits?
Why’s he selling would be my first question followed by a very close look at the books.
Remember it needs to be making whatever the interest would be on £50k + your wage.
Otherwise just put £50k in a savings account and go work in someone else's bike shop.
Stock is one thing, the goodwill and reputation of the shop is another which no doubt the owner has worked hard for years to build.
Starting a business from scratch is hard work, so you need to work out the cost of the stock plus the goodwill and profitability of the business. It's not as simple as buying some stock and setting up somewhere else for less cost.
120k a year turnover
If an average bike is £1.5k then that’s only 80 bikes a year or 3 a fortnight
Do we get discount?
an average bike is £1.5k
I get the impression this is yer bog standard LBS. average bike will be £150 tops.
My guess is that majority of income comes from maintenance (and associated parts) though.
Stock is one thing, the goodwill and reputation of the shop is another which no doubt the owner has worked hard for years to build.
Absolutely, but my point was more that at least a proportion of the existing stock will be dead stock i.e. unlikely to sell at the valuation that the owner has put on it and that that needs to be factored into a realistic valuation of the business by someone that knows what they are talking about
Interesting topic this one, I've also thought about this but could never get the figures to add up to enough to make a comfortable enough living.
So your £50k, buys all existing stock, retains the current rental agreement and all of the existing shop fittings? When is the rental agreement up for renewal? Any commitment to keep rent low?
What do you think you need in order to make the shop a success (financially)? How does this meet against the current shop takings? I presume they have staff now, would they continue or new staff needed? Would you be liable for any liabilities the current shop has? As the shop is out of the way, what would you do differently to bring in customers?
Also, £50k to buy an existing business might not seem like much. But what cash would you have for the first 12 months to cover your first year running costs? £50k could quite easily be a need to have readily accessible £150k or more. (Shop fitting improvements (security/CCTV, workshop and shop floor), advertising, wages, new stock, insurance, web site, usual rates (electricity, water, telephone etc), and last but not least business taxes. Can the business pay back the money you are going to need to sink into it?
Watching with interest what other experience folk have had.
Is it Ubyk? A friend of mine sent me a link about an hour ago from a site selling assets of insolvent businesses which appears to be them!
Agree with Perchy here, for example £40k of stock might actually only have £10k of gear that will sell. Old 8 speed Claris for example, would have been useful 10 years ago, but unlikely to sell now. Similar to clothing, especially if its road related gear. Its important to look at the stock and to decide whether you think it has a correct resale value and not the value of what it was purchased for.
So £50k to buy the shop and the stock may actually be a big loss. The business has to repay the £50k purchase price at some stage and dead stock won't help it do that.
If money was no object and you fancy a "toy" business to run, then I'd go for it. Unfortunately for me it would have to be profitable enough to provide a living wage so I couldn't justify sinking in x amount of £ that I'd probably never see again.
can also consult for the company i currently work for, so the shop wouldn’t be the sole source of income.
Be aware that running a shop properly is a full time job. Unless you plan to employ other staff, what will happen to the shop while you're doing outside consultancy work?
Do you have any experience of retail or other customer facing industries?
Are you willing to be in the shop all day every weekend?
As above, find out what the profit has been (and whether or not that takes account of the current owners wage) for the last few years.
Surely depends realistic value of stock? And make sure the current owner actually owns all that stock and isn't on sell or return or an account that isn't fully paid up
Is it Ubyk? A friend of mine sent me a link about an hour ago from a site selling assets of insolvent businesses which appears to be them!
I'll bite, what's the link?
Stock is one thing, the goodwill and reputation of the shop is another which no doubt the owner has worked hard for years to build.
Starting a business from scratch is hard work, so you need to work out the cost of the stock plus the goodwill and profitability of the business. It’s not as simple as buying some stock and setting up somewhere else for less cost.
This is true, but unless the current line of business is what you want to be involved in, you will have to continue to run that (which might be emotionally tricky) whilst also trying to move the business into your desired arena.
A "bike shop" is a very broad term.
That said, repairs etc. can't be threatened by cheap internet sales/brands going to direct marketing.
beer247
...Am I mad?
Have you ever worked in a bike shop?
A year of doing that would give you your answer.
business plan.
Ill be surprised if anyone continues beyond it if they have a realistic business plan for a bike shop......
those that do are either going to be green or looking back with rose tints on.
spent 10 years of my youth working through doing the whole kit and caboodle in a shop workshop/shopfloor/stockcontrol ordering and min/max levels/accounts.
Ive done a few business plans for shops and while i see the demand - the level of comitment required out of my coffers doesnt match the reward or the lifestyle.
Speaking to others who have tried and speaking to others who have looked at it - we all came to same opinion - its a subsistance business at best today. 15-20 years ago it was a different story. If your established in life and have a partner with a stable income that covers the bills then you could force it through on a love but its not a growth sector - nor have you a differentiation from anyone else doing the same near by....
You'd need to be radio rental imo - and ive come close a couple of times.
Turnover = vanity
Profit = sanity
40k of stock? Why so much and as above is it Any good
I’ll bite, what’s the link?
It's on [url= http://www.ip-bid.com/ ]here[/url], you have to sign up (hence not sharing it), I'm guessing, but can't see it being anyone else. Text is:
Business ID: 1605
Business Category: Retail sale in non-specialized stores
Additional Categories: <span class="x_m_-3921980056114059188gmail-container-confirm-text">Other sporting activities
Other recreational activities
</span>Turnover: £1m to £4.99mEmployees: 10 to 99
Location: National
Posting assets: <span class="x_m_-3921980056114059188gmail-container-confirm-text">Leasehold property</span>
<span class="x_m_-3921980056114059188gmail-container-confirm-text">Stock</span>Description: <span class="x_m_-3921980056114059188gmail-container-confirm-text">Opportunity to acquire the Business & Assets of a Well Established Online Retail Store with Two Boutique Stores Based in the UK
Unique visual custom bike builder website (own built software)
Two Award Winning Showrooms (Leasehold)
Established International High -End e-commerce website, very well optimised in Google
Huge range of brands represented : AX Lightness, Cannondale, Colnago, Cinelli, Cipollini, Parlee, Look, Orange, Scott, Yeti, Santa Cruz and many more
Stock of bikes, components, helmets, clothing and accessories
International potential with websites in Australia, US, France, Spain, Denmark and Sweden</span>
Turnover = vanity
Profit = sanity
Cash = king
How come there are no business rates?
njee20 - ta, it's a shame - I know they were looking to close the Brighton store last summer but it didn't seem to happen. As you say, given the description and brands it's the most likely candidate.
My guess is that majority of income comes from maintenance (and associated parts) though.
Makes it even more concerning that there seems to be about third of the annual turnover sitting in stock.
Wwaswas - agreed, AX Lightness and the customer bike builder leapt out, not exactly common! A shame though if they do go, always had good dealings with them, and everyone likes pimpy stuff.
a number of councils have decreased or abolished rates if your business is in a town/area of the town targeted for regeneration or is ailing to encourage business' to stay / come to the area.
unfortunately none of the areas in my locality are them - and they are actively putting them up almost as if to incentivise out of town shopping centres..... the rates alone on local suitable locations would be more than my mortgage a month - and we aint talking a big unit.
How come there are no business rates?
Depends where you are in the country but in some areas you can get a rebate up to 100% on rates for lower valued premises. That's not 'no business rates' as such, you have to apply for that rebate annually. Also... as a plan going forward - regardless of whether that rebate is in place you want to know what the cost would be if that rebate were to vanish. They're not carved in stone and a change of heart (or a change of local / national government) could see the rebate vanish.
And you want proof of what those rates would be, not an assurance.
This business sounds to me like it’s repairs and accessories only, no bike sales?
To be fair, if I got the money and and an opportunity like that I’d give it a shot. Why? Well, in the last shop I worked in I personally turned over just over £100k in the workshop, so a similar size and a similar commuter market too. That was me on my own, sole mechanic. The split is roughly 50/50 parts and labour, and we made good margin on the parts too. I reckon around £70k gross profit from that £100k + turnover. Not unreasonable. £5k a year for rent? Sounds cheap to me. (I realise there’s other stuff that eats into your profit) I think I could make a good job of it personally.
Its very easy for the average STWer to make assumptions about the average price of a bike in the average LBS but the commuting market is where the money is to be made IME. I now work in a high end shop and the workshop turnover is much much lower than in my previous job. Commuters don’t care about bikes. They just want one that works. Explain to them that the £150 service on their £400 bike (that’s a very common figure on a well used commuter) will set them up for at least a year and £12/month is a LOT CHEAPER than a travel card and they just pay up without batting an eyelid. Do the job right and they come back.
But yeah, a repairs and accessories only shop with a good solid base of commuters passing the door is right up my street. I’d go for it. 😀
“Makes it even more concerning that there seems to be about third of the annual turnover sitting in stock.”
And tools. And shop fittings. Etc etc....
Easy to spend £10K on bike tools. A Kestrel workstand must be £5-600 these days, for example.
I reckon around £70k gross profit from that £100k + turnover. Not unreasonable.
A bit unreasonable.
Seems an unrealistically high margin for any business.
"I reckon around £70k gross profit from that £100k + turnover."
working for free were you ?
There is a difference between gross and net profit .
indeed , but its not like your standing there scanning items through a till , you are the product and the service.
Its like running a garage without mechanics.
not gonna work.
But thankfully accounting convention makes your books look good if you remove the main cost of realising that profit when your a service industry.
The thing with Gross profit is as the small business owner you can work out how much to pay yourself and what roi you'll get.
If you look at Net profit you have no idea what the fixed costs are?
sort of ,
you'd need both net and gross as a minimum
peters example looks great because he only gave us gross. it is misleading without knowing the fixed and unfixed costs to realise that gross.
Peters quoted numbers are meaningless.
There's a bike shop in a small northern town i go to thats expanding. No business rates as its a regen area. They sell cheap new and secondhand, I doubt much is over 150 quid. Recently moved to larger premises, 2 guys. I was in there once and they bought few old wrecks for 20 quid, strip them for parts.
Cops are always in there tho....checking out the stock i should think.
Actually looks like a sound business to me. Cheap rent, no business rates, just 2 guys, buying and selling cheap stuff. Fits the local market.
120k a year turnover for the last 3 years according to accounts
I can't imagine that's enough to sustain much in the way of salary in retail.
As for the question in general. Look which way the wind is blowing, retail in general is in the decline. The cycle industry has managed to buck the trend to a degree up to now, but a lot more LBSs are closing than are opening these days.
Financial considerations aside, do you really want to work with bikes? Seems like a good way to ruin a hobby to me.
There was a great thread linked to on here from Pink Bike? about the guy who set up a bike shop and was detailing his trials and tribulations...
That's a good read.
I once got offered a bike shop to buy, looked into it and realised the owner was earning a tiny amount of money but having to work pretty much every day. So despite the fact he got a shiny new bike to ride, he was stuck serving customers all weekend. The shop got sold and turned into Leisure Lakes Daventry, but that was pre internet.
The other thing to consider is you have to deal with customers, a lot of them will drive you mad.
Personally I reckon you will go broke fast, never have any free time to actually enjoy riding a bike and end up suicidal when you have to deal with annoying customers.
actually i do know one guy who's doing quite well out of the trade.
BUT he lives abroad and is bringing high end bikes into a country that doesn't have easy access to them.
works hard but does well from it.
If I had a spare £50k the last thing I'd be doing is buying a bike shop. It would be like betting it on the horses.
I've got a few questions:
- How long is the lease and how long is that rent guaranteed for?
- How many staff are you planning on having? If it's just you, and most of the turnover is in repairs, are you a good enough mechanic? I don't mean that cruelly, but although most of the readers on here think they're as good as a professional mechanic, most of them are nowhere near as fast, as experienced or have the breadth and diversity of knowledge as full-time professional mechanics who work on all sorts of bikes every day. If you don't have the skills and the experience, you're going to need to pay someone who does - and you're going to need them to be good, because your shop's reputation relies on the quality of your servicing and customer service.
- What's the customer base like? If you're buying an established business that was essentially dependent on its previous owner (which I'm guessing you are, based on the low valuation), you're really only buying a name and some stock, and some customers' visiting habits. You're going to have to do all the hard work yourself to re-build the business, which means knowing what sort of shop you want, how you want it to run and which customers you want to appeal to from the start. If the business has a lot of loyal (or local) customers, that's a good start because you won't have to start from scratch, but you'll have to serve their expectations from the start.
- What's the stock and tooling you're buying? As someone else said on here, it's only worth something if you can sell it or use it. If it's a load of knackered grubby tools that you'll need to replace, they're worth nothing. And shops up and down the country have boxes of 7-speed Altus brake / gear lever units they can't shift or stupid-size shoes in rubbish colours, or quill stems, or bar ends, or cheap suspension forks, or obscure disc brake pads, or...
- What was the previous owner taking from the shop as a salary? And what do you expect to pay yourself? And if there are other employees, what's their salary - and how much extra do you need to include for the new auto-enrolment pension stuff, etc? Don't just look over the accounts, spend time poring over them. They will tell the story of the shop.
- What's the security of the shop like? If it doesn't already have an alarm, shutters, bars on windows, CCTV etc, you may well need to shell out for them if you want to sleep at night or not pay high insurance premiums. More than one bike shop has closed in the last year after a significant break-in wiped them out irrecoverably.
Yes I'm in the trade, and I know how much the trade is struggling. Buying a bike shop at the moment is a very risky move, but not necessarily a stupid one if you're prepared and you know what you're doing - and where you want to go. PM me if you have trade-specific questions and / or want an inside view.
Didn't Ubyk get broken into earlier this year ? I think I read in the local news a van turned up and took all their bikes.
"Why? Well, in the last shop I worked in I personally turned over just over £100k in the workshop,"
PP was fitting Di2 to trick Cervelos for the triathlon crowd in a rather well-heeled (actually silly well-heeled) area! 😉
Personally, if the books look sound, and you have a passion, why not? Oh an since you have a consultancy business on the side, just offset the losses when it all goes wrong against the profits from that side of the business. IAMAA
There is a list on a private/closed forum for the cycle industry that details IBDs that have closed over the past 12 months. At the last count it was 133 and rising.
Glad I got out of retail when I did.
**** me thats some return....
Money laundering Doesn't return that...
Who are the customers?
if they are bringing in poor quality supermarket bikes to fix then you could be wasting your time,
trying to fix bikes that aren’t fit for purpose new let alone 6 months down the line is a ball ache.
remember we are a vocal minority who own expensive bikes and ride with friends who ride expensive bikes, 95% of the U.K. population would have a heartattack If you told them how much your bike cost ;0(
Bikebiz article on bike shop closures:
https://www.bikebiz.com/business/bike-shop-closure-rate-now-at-highest-since-the-1960s
Another interesting read
remember we are a vocal minority who own expensive bikes and ride with friends who ride expensive bikes, 95% of the U.K. population would have a heartattack If you told them how much your bike cost ;0(
From that bikebiz article, 46% of folk with a bike are sport or enthusiast cyclists, so whilst it’s a minority in literal terms, it’s hardly insignificant to sales. They are just more fickle about where and what they buy.
i was trying to say, a lot of repair business is working on crappy bikes that haven’t been oiled or lubed since purchase, it’s hard work.
premium bikes and components are easier to work with but few and far between for a standard bike mechanic/ shop, especially if they don’t have the big American or premium bike brands
and certainly up north some people wouldn’t pay the brass to have a bike fixed to a good standard.
demographics and customer base is a key consideration,
u could open a shed in a small village outside London and sell 10 premium bikes a day , but if you opened a bike megastore in a northern town u may only sell 5 a week , Grimsby it’d be less
op "Am I mad", Yes you are sir.
I was good friends with an LBS owner in a crappy area, most of his trade was crap kids bikes (he used to hate Christmas, he'd spend weeks building up dozens of shit bikes for thankless parents complaining £50 is too much for a bike). He did have some trade from the local roadie club but not enough to make it a flourishing business. He ended up retiring with a dodgy back and neck from too much time in the workshop, he did sell the business on but it closed not long after as the new owner didn't want to do the cheap bike stuff and there wasn't enough higher end business.
Unless you're a multi-millionaire, can afford to employ decent staff and don't care about making a profit so you just turn up for a coffee, chat and free stuff I wouldn't go near owning a bike shop.
The only 'bike' shop I know that's doing well (outside of London) is more of a coffee shop than anything else. I think that's a good business model - location is key but I'd imagine the margins in the cafe subsidise the shop (or at the very least guarantee footfall)...
A bit unreasonable.
Seems an unrealistically high margin for any business.
+1. Suggests a complete lack of business understanding. Stick to fitting pedals.
There are over 20 bike shops in Cambridge (pop 120k), plus multiple mobile bike repair vans, so there is plenty of business in the right places for the right demographic.
We have an Evans, a Halfords, three Rutland Cycles Stores, a Giant Store, a dozen or more independents (several on the same street). The Rutland store nearest us does a roaring trade in e-bikes, selling multiple multi £k electric town bikes every week. Customers are mainly older people as far as I can tell.
cambridge is far from the norm though. You can see more bikes in a day there then ill see in 2 years in huddersfield
The list of closures via the BikeBiz link is a year old - I wonder how many more are now on the list? Stand-out shop on that list was Simply The Bike in Torquay - that shop had been around years.
I think for a one-man-band (with a 'Saturday Boy') running a local bike shop that can appeal to locals for Christmas bikes and isn't afraid to get it's hands dirty with typical family/commuter bikes, there is still a good living to be made.
Repairs can be pretty lucrative, but you have to be comfortable doing the work that other people can't be bothered with - it's not glamorous.
I think the trouble comes from trying too hard to be cool and stocking too many £300+ bikes and too much bling. You'd be better off making it clear that these are available, but only ordering when needed.
Unlike some opinions up there - 40k of stock doesn't sound like a lot to me - anyone who has run a shop will know how quickly it adds up.
---
If you want to have a large boutique shop with lots of high-end bikes, I think that's a much riskier proposition and would be much more particular to location/competition. Even award-winning shops with an established niche and access to successful brands are having to pull every trick in the book to stay afloat.
My neighbour took redundancy and used the pay out to start a bike shop near by. Must have been 4-5 years ago now. His wife works full time and kids are adult and left the nest so he's able to plod along but I think he makes little money. Another bike shop a few hundred metres away went out of business after he set up, but another, rather large one opened. It must be tough.
UBYK had a turn over of £3.2m but still went into insolvency.
I imagine the administrators will want more than £50k though to buy the business.
Times are hard for many of us in small bike shops. The shop I work in would be seen as out of date by many of you. It’s cluttered with to much stuff and there is no posh coffee machine plus we can be a little disorganised but we are still open
we have always just got on with fixing what ever comes through the door , a fair chunk of our customers are not cyclist just people that ride a bike
we do sell the odd nicer £1000 plus bike but mostly this last few years it’s the workshop that keeps things going day to day.
It’s taken a few years to educate the younger mechanic at work that his wages are very much linked to being able to fix bikes that he thinks belong in the skip.
I guess what I’m getting at there is still a living to be made just it’s not always with shiny stuff. Depends on location of course
As someone who's done it, I couldn't recommend it... 15yrs ago maybe. 5yrs ago when I started it was OK, I wasn't going to get rich, but by being a bit unique and providing good service and securing some good products, it was turning over a small profit.
The industry has changed BIG time, their hand forced by the political and financial climate that we are in mostly. Retail outfits are struggling full stop (and it's not like the online boys are having it easy either, they're struggling right now too!) and anything that is seen as a luxury rather than a necessity goes out the window so to speak.
As an example of how volatile the bike trade is right now... On 1st November, in 1 sale, I took almost twice as much money through the till as I had done in the entire of October! OK so that's a very high end custom full sus build dripping in bling that's been ordered, but October was so quiet, we barely sold a bike and the workshop wasn't busy either! Most of the smaller shops within a 25 mile radius of mine have closed down in the last 2-3 years too, and the shops that are still open are all struggling! There's a few shops that are bucking the trend, but that won't last long once their novelty has worn off (newly opened in one case near me, and another one has thrown hundreds of thousands of £'s into e-Bikes and has become a bit of a mecca for them). I have very nearly decided to jack it in several times in the last 12 months, which is crazy considering how 3 years ago we were so busy that I could barely cope!
Good luck whatever you do, but I wouldn't spend £50k on a bike shop right now...
run a mile. lots have closed down here in the last few years.
there are a few mobile and specialist mechanics, actually more than there are shops now.
tbh I think the future is in setting up a local then regional good reputation personal service drop off r collect/return maintenance service. if i had the capital and inclination i'd set it up.
Do something else with the money
@beer247 did you take it further?
The bike shop near where I grew up is being sold (owner retiring). Even after reading this thread again and concluding the numbers don't stack up I am curious about people who've taken the plunge. Seems it's only worth it as a hobby/social endeavour.
UBYK had a turn over of £3.2m but still went into insolvency.
I imagine the administrators will want more than £50k though to buy the business.
Still stand by that statement? 😉
John’s Bikes in Bath, where I’ve spent a considerable amount of money over the years, has now closed down, which I would never have thought possible in Bath. A real shame, but poor management and buying choices recently, plus Bath business rates which are very high, seem to have done the business in. ☹️
Two things to consider that might add sustainability to and LBS.
Social Enterprise: teach people to ride and fix their own bikes. Do that for specific groups like marginalised youth or people in recovery. Add a cafe to the shop and bring people together reducing isolation and building your community. There are funds about for such things and such activities deserve them.
EBikes: I believe the govt are on the verge of subsidizing them for commuters.
Article in yesterday's Observer: 'How millennials have put a spoke in the wheels of Britain’s bicycle shops'. Interesting reading, if somewhat downbeat.
https://www.theguardian.com/business/2019/jan/12/millenials-cycle-shop-closures
The reality of most small businesses is you are just buying yourself a job. One that you can't walk away from.
However, a good operator can turn a small business into a big business - that's where most big businesses start.
More important than the figures (and they're important) are two factors, potential and possible downfalls.
Two possible downfalls stand out, and they're both related to govt. What happens if the Bike to Work scheme gets the chop, and what happens if business rates relief gets withdrawn?
And never underestimate what can happen if you fall sick...
Potential is entirely up to you.
Regardless of the above, life is much better if you are your own boss though...
I like a good bike shop and try to support my decent LBS as much as is sensible even if I end up buying something at a 5 or 10-% premium...the value of the advice I get when I pop in to ask a quick question or kill 30 mins at lunchtime browsing round bikes I cannot afford. But for me if you're going to buy a bike shop then don't run it as just a bike shop. I think you need to be trying to attract the cyclists in, especially at the weekend...so needs to be a decent bike shop that sells stuff that local cyclists want and not trying to directly compete with the Wiggle's of the world, and needs to be a Cafe and whatever else that attracts cyclists in. I think it would depend on location for me...is it right on a popular cycling route where cyclists can pop in mid-ride.
I think there is still a place for bike shops but not many and they need to be more than just a bike shop.
Regardless of the above, life is much better if you are your own boss though…
Well define better. From people I know that own their own businesses there are upsides...i.e. being your own boss, and downsides....unbelievable stress, not knowing if you're going to be in business next month, no back up in terms of holiday entitlement or sick benefits, long hours, huge risk, often your family home is on the line as collateral, staff and personnel problems that are frustrating etc. My observation from them is that it takes around 20 years from setting up a business to getting to the stage where you actually start benefitting from it...when the business is established, has grown to a level where it is sort of running itself, where there is a critical mass of employees and where the business owners start to benefit from the investment of their time, effort, feel like they can start paying themselves a half decent salary and start to live life again, go on those nice holidays, buy that nice car etc. That is assuming the business lasts that long of course...most don't. But none of them regret it so it must be immensely satisfying.