I am looking to purchase an existing up and running coffee shop, the owner was looking to partner with someone because he is unable to run it anymore. After finalizing a plan to make changes and improvements for me to join, he decided that he would rather just sell it to me fully and he would finance me. He has told me to come up with the fair purchase price and has even accepted my terms on a "ramp up" period for the first year, so I would pay very little at first and increase as time moves on. I have done my evaluation and have a number that I am going to offer but I am curious what others think. So the largest factor in this business is as it sits currently, there is not profit being made. For maths sake lets just say it is breaking even, although in reality it is losing some money. He has other businesses that have kept the shop afloat. - Business has been operational for since 2010. - Currently there is $80,000 in cash flow (with no profit) with a decent customer base. - Assets include $56,000 in equipment, furniture, and inventory. - The building is leased and I would take over his contract with building owner, rent would stay the same. - The owner claims he has spent about $150,000 since opening the business - He has made crucial tenant improvements including, water, air, electrical, plumbing, walls, storage, point of sale system, and cosmetics such as paint, flooring, lighting, and new bathrooms. We will iron out length of term and interest, but as far as official purchase price what should I offer? Thanks! P.S. I would be making major changes and improvements to the business as a whole once purchased. Currently no marketing or advertising being done at all, and currently half of the space is being used for a different business of his and would be moved out completely once purchased.