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BUYER’S INFORMATION PACKET
Prospe ct motel
About this business
Buying a business can Smith of Crown Realty the business not only
be an exciting, chal- Services(814) 486-0313 financially rewarding,
lenging event. There www.crownrealtypa.co but also personally re-
are lots of questions to m or Teresa Genaux , warding from interac-
ask and numerous con- manager at (814) 486- tions with interesting
siderations to take into 9035. people and new friend-
account before decid- The Kulecks and ships we’ve made. The
ing if owning and run- Genauxs purchased motel has generated a
ning this business is for the Prospect Motel as profit each year we
you. an investment property have owned it. This
that would provide the booklet describes some
Genauxs with a home of the day-to-day op-
We’ve assembled this erations. As the new
book to provide infor- as well as investment
income to the part- owner, you will decide
mation to help you how to operate your
make an informed deci- ners. After many years
of ownership—we business.
sion. If you still have
unanswered questions have achieved our Special points of in-
after reading through goals and plan to terest:
pursue other
this booklet, please • The motel is a prop-
don’t hesitate to con- goals. erty that pays for itself.
tact our realtor Margie We have found
• The only housing ex-
pense you incur is your
long-distance phone
bill.
G ro s s i n c o m e
• Regular room rental • Pets • We can help you learn
Gross income is derived from fees the ropes after the sale
• Phone card
several aspects of the busi- Other income sources of the property.
ness. Annual income sources • Showers
include:
include:
• Snacks
• Pop machine
• Apartment rental
• Full RV hookup
• Electric
• Long-term motel stays
• Post cards
• Personal Tips
PAGE 2 PROSPECT MOTEL
What your invested dollars buys
We have calculated our asking price • Furnishings value $32,000
using two independent methods. 11’, and 8’x16’
• Goodwill value $4,000
PROPERTY VALUATION METHOD: • Currently 2 rooms of the house
Details of the 1,356 square foot are written off income tax as
The physical property includes a 3 house include: being used for business pur-
bed-room ranch home and 9 unit poses.
motel plus 1 bedroom apartment • Living Room 11’5” x 23’
on .5 acres serviced by city water • Dining Room/Kitchen 11’x18’
and sewer. New roofs on the house DISCOUNTED FUTURE CASH FLOW
and efficiency were installed De- • 1.5 Bathrooms
METHOD:
cember 2001. Motel metal roof in- • 3 bedrooms 11’5”x12’5”, 11’5” x $49,000 annual income projected
stalled early in our ownership. .
over 5 years at a 15% rate of return
Property also includes all furniture,
yields a property valued at
bedding and linens to continue
$164,255. This does not assume
business operations.
increased income which would in-
• Land value $5,000 crease the property value. What
other investment can you currently
• Residence value $56,000
buy that yields a 15% return on
• Motel value $48,000 your money?
Service is your product
Bu s i n e s s M o d e l
or credit cards and use direct billing
During our tenure we have oper- years we have made many friends and accept the state rate for Penn-
ated the motel 24 hours a day, 7 of our customers who return year sylvania state employees traveling
days a week. We pride ourselves in after year and even season after on business.
being owner-operators with service season to enjoy their stay in Cam-
being our only product. Many cus- We maintain a customer database
eron County. We set our rates after which is used to generate prefer-
tomers have noted that while the considering our costs and our com-
rooms were not first class (for which ence letters to fishermen and hunt-
petition. Special rates for weekly ers who have been loyal customers
they would expect and monthly
to pay $100/night) in the past. Preferential treatment
stays, pets, and has helped retain this customer
our low rates offer “Service is our only product. We take pride even the kitch-
a clean, comfort- base.
in building and maintaining customer enette have
able, friendly place been utilized. We continually ask ourselves, what
to stay. Over the satisfaction and loyalty.”
We accept cash (Continued on page 4)
Ow n e r B e n e f i t s
In addition to providing a home, con- • Telephone including:
sider the following other expenses that
• Natural Gas toilet tissue, dish detergent,
are paid by business income.
cleaning supplies, postage,
• TV cable • Electric hardware items, laundry,
snow removal, snacks and
• Internet connection • Auto expenses pop, and use of the motel
• rooms as additional space
• Water Mortgage
for personal company vis-
• Sewer • Property Insurance its.
• Garbage • Personal items In addition to cash salary, consider all other
household expenses paid for by motel income..
PAGE 3 PAGE 3
Financial statements
We can provide you with accurate, current forms as well. We can only release these con-
financial statements regarding the business tingent to your submission of a written offer
to help you determine if the purchase is the to purchase)
right choice for you and to help you in find-
• Detailed inventory of fixtures and equipment
ing financing for the purchase. We can
provide you with: • Names of our advisors
• Three years’ profit and loss statements
• Federal Income tax returns for the busi- These documents will indicate that the business
ness (Because we operate as a partner- makes enough money to pay for itself, and pro-
ship—this will include our personal tax vide s “living space.”
They will also assist you in securing financing, if
necessary.
Financing the Purchase
We realize that going into business Cameron County Industrial Devel- business is eligible if it is a start-up
for yourself is an expensive proposi- opment Authority has two types of or existing business with less than 5
tion. We were fortunate in being revolving loans. Loans for capital employees. For more information
able to personally finance the first improvements or working capital contact Cliff Clark, Cameron County
20% down and then obtain financ- are available in the amount of 50% Economic Development Office,
ing locally. Several financing op- of the total project for up to South Chestnut St., Emporium,
tions are available to the right buy- $200,000 at a fixed interest rate of (814) 486-3439.
ers. 2%. The micro-loan The possibility of owner-financing
If you presently fund can be used also exists for qualified buyers.
own property, as a sole funding
selling it or Numerous financing sources are available source for up to
borrowing to assist you with the motel purchase. $25,000 in capital
against it may improvements or
be an option. working capital. A
About our competition
In Cameron County, our primary seek a clean comfortable
competitor is the Buttonwood room at an affordable
Motel. In Elk County, competi- price. They find our facili-
tion is two chain motels located ties to adequately meet
on the Million Dollar Highway. their needs. Amenities we
These motels are larger, more provide to add value in-
modern and generally 1.5 to 2 clude phone cards for long
times as expensive as staying in distance calls, fax service,
Cameron County. They are also free wireless internet, color
25 miles from Emporium. cable TV, alarm clock- We offer clean, comfortable rooms at affordable prices.
radios, microwave ovens,
mini refrigerators, air condition-
The clientele we serve tends to ing and automated wake-up
be working class citizens who calls.
PAGE 4 PROSPECT MOTEL
Are you ready to be a business owner?
Some of the reasons people buy need to have specific qualities. We ers
businesses include: believe the buyer (s) will:
• Possibly be a stay-at-home mom
• Laid-off, fired, being transferred • Be able to do minor household looking for a way to achieve
repairs. family financial goals while still
• Early retirement
caring for her children.
• Be a “people person”, willing to
• Job dissatisfaction
provide service to the custom- • One of the adults would have a
• Desire for more control job with health benefits.
over their lives
• Be willing to work for your-
• Desire to do his or her own self in return for the benefits of
thing being your own boss.
• Relocation • Be creative in finding new
The opportunity to create your ways to attract and keep cus-
own future is pretty exciting tomers
stuff. We have learned from • Be active in promoting Cam-
being business owners that in eron County and tourism
order to be successful, you
Bu s i n e s s M o d e l
(Continued from page 2) when someone forgets something spondence.
can we do to “outdo” our competi- in their room, we generally mail it On occasion we have helped some-
tion? Since our business is based on out to them or let them know we one out by doing a load of laundry
service what can we offer that our are holding it until their return. or driving them to town to make
competition doesn’t? One way Many customers have expressed purchases. We even help people
we’ve been successful is by actively surprise at our conscientious care of locate a place to stay if they arrive
marketing our motel. In other their personal items. without reservations and we are
words, rather than waiting for cus- We have used the database in the full. This happens most often during
tomers to come to us, we go out past to gener- summer national holidays, hunting
and seek them. For ate postcards season and during the fall when
example, Teresa to thank cus- many people set out for a drive to
scans the local “What can we do to “outdo” our tomers for their see the leaves and find themselves
paper weekly for past patronage far from home without a place to
bid announce-
competition?”
and encourage stay. Maybe we can’t help them this
ments such as them to return time but they might remember our
bridge repairs, re- by offering a kindness on future trips.
paving, major construction projects $5 discount on their next visit.
occurring within a 25-30 mile radius We set our room rates based on our
of Emporium. She then contacts the We ask our guests how they heard expenses and our competition. To
awardees, usually by way of a letter about us/decided to stay with us as increase your income, an increase
of introduction and a price sheet to a way of determining if our advertis- in rates would be helpful—but re-
make the business aware of our ing dollars are used effectively. main lower than your competitor.
prices. She also will stop by work- We encourage visitors to view the
sites to drop off information. We elk, visit other local sites and partici-
have found this personal contact to pate in community events.
be very successful in attracting busi-
ness. Many people have noted our friend-
liness and helpfulness in notes left
Another business practice we use is in the rooms and in other corre-
PAGE 5 PROSPECT MOTEL
Day to day operations
We try to run a 24/7 operation rely- Several salesmen come through Em- people start checking out—
ing on coverage by the partners porium on their route and stay regu- sometimes they aren’t gone until
and the use of technology. As time larly with us. If the 11:00 a.m., but
has passed we have found that by weather is decent, al- most are up and
using the answering machine and a lowing for travel, we out by 9:00.
sign in the door, leaving the busi- will get weekend visi- Bookkeeping
ness unattended for a few hours tors. and many other
periodically has not reduced our It takes between 20 and office duties
business. The phone system can be 30 minutes to clean a could be done at
set in the evenings so that if callers room, depending on your conven-
know the guest’s extension, they your energy level and ience. Yard main-
can direct dial it after hours. Also what needs to be done. tenance takes
the office door intercom allows you To fully clean all 9 about 3 hours
to communicate with late-arriving rooms generally takes weekly.
guests through the phone system. less than 5 hours. Addi- During heavy
Monday thru Wednesday are the tional time would be snowfall, we con-
slower days of the week, creating allocated to doing laun- tract out plowing
opportunities for a day off. dry—but this could also of all driveways,
December through February are be done simultaneously generally two to
slow months, but this does not with the cleaning. Gen- three times a
mean we don’t have customers. erally, we start cleaning as early as winter.
H ow fa r w e ’ v e c o m e
Since we’ve purchased the mo- new linens and most of the mat- New sewage lines were installed
tel, we’ve made numerous tresses as well as replaced all of for rooms 5-efficiency with clean
changes and improvements. We the television sets .The metal outs at every room.
installed the Partner Plus phone roof over rooms 1-7 is new. The
system, alarm clocks, smoke de- bed and wall-
shingle roof over the apartment
tectors, and car- and rooms 8 We have been able to do some
bon monoxide and 9 and the of the renovations ourselves
detectors in “Over the years we have owned and while some of the work was
house are
rooms serviced operated the Prospect Motel, numerous new as of De- contracted out.
with natural gas. improvements have been made.” cember 2001.
Purchased all
After the sale
Following the sale, Teresa can provide sonal motel upkeep. covenant not to compete is agreeable
you with 80 hours of assistance in learn- to all partners.
She can also help introduce you to
ing the ins and outs. She foresees this as
other local business people to help you Our goal is to make sure the sale of the
being several consecutive days and
begin networking with the community motel is as smooth as possible so that
then later functioning in an as-needed
and tourist promotion agencies. no interruption of service occurs. We
advisory capacity.
have spent years building the business
Both Robin and Teresa could be avail-
She can help you understand the and creating goodwill; our intent is to
able on a limited basis to assist with
phone system, computerized bookkeep- further these goals with the new owner
cleaning and coverage of the office, at
ing, and general day-to-day and sea- taking up where we leave off.
an hourly rate, if necessary. If desired, a
PAGE 6 PROSPECT MOTEL
How far Property description
we’ve come
• 9 motel units fully furnished
• Air conditioned, carpet, mod-
ern phone system
• All bed and bath linens
• New roofs, hot water tanks
• 1 BR apartment
• Innkeepers quarters—3 BR, 1.5
bath ranch with wood burning
fireplace, wall to wall carpeting, air conditioning, attic pull
down steps, screened enclosed porch, carport.
• .51 acres of land
A lt e r n at i v e u s e s
While the property has been run as pied by the motel property, the ad- The possibility for expansion of the
a motel for over 40 years, it could jacent properties could be acquired motel, upgrading to amenities of-
be adapted to other uses. Remodel- to create a 1.22 acre property. The fered by chain motels and even the
ing could result in several efficiency Knarr property to the south is a du- construction of a restaurant to com-
apartments convenient to down- plex on .32 acres. “Furniture for plement the motel are all considera-
town. The units could also be con- Less” to the north sits on .39 acres. tions.
verted to storage units. All properties front route 155 .All 3
Cameron County is quite mountain- properties are zoned residential-
ous, with very little useable flat land. commercial and have city water,
In addition to the .51 acres occu- sewer, electric, gas and tv cable.
C a m e ro n c o u n t y
Emporium is the county seat for seen renovations to the elementary growth with new factories built by
Cameron County, the second small- school and additions to the high GKN Sintered Metals, Brownco, and
est county (population) in Pennsyl- school. February 2002 saw the several other powdered metals sec-
vania. The local economy is focused opening of the Barbara Moscato ondary operations.
on powdered metals, lumber and Brown Memorial Public Library on Despite the increase in industry, it is
tourism. Growth in nearby St. Marys West Fourth Street. The 100 year – anticipated that the county popula-
and Coudersport make Emporium a old county courthouse renovation tion will remain near the current
bedroom community, maintaining and addition were completed sev- 6,000 level.
its small-town charm and attributes. eral years ago as well.
In the past few years the county has Local industry has experienced
PAGE 7 PROSPECT MOTEL
Month-by-month naRRative
January May
giving.
Since Emporium is the county seat The normal business flow continues
and the Department of Conservation and is increased by hikers, bikers, October
and Natural Resources has a district campers and Spring Gobbler hunters “Leaf-peepers” spend the first 3
office here, Pennsylvania state em- and Memorial Day weekends in October enjoying the
ployees are frequent guests. Guests vacationers. fall beauty. We were surprised the
also include tourists, hunters and Alumni weekend first year we had the motel how
family members attending funerals or brings Cameron many people just get in their cars and
making family visits. Senior citizen County High drive to enjoy the scenery and end
discounts are offered to families visit- graduates back to up needing a room. Unfortunately,
ing residents of the Emporium Arms, the area. Nature many others make reservations and
Guy and Mary Felt Manor and Maple enthusiasts enjoy we often have to turn folks away. Fall
Street apartments during January kicking back and archery season and the elk herd in
through April. Snowmobilers also find relaxing and elk Our database helps us document our rut draws many guests.
access to trails close to the motel. We watching.
November
have offered a New Year’s package in June
the past. Several businessmen stay on Turkey, Black Bear and Deer season
a weekly and bi-weekly basis. School lets out and many families create an increased demand for lodg-
head for the open road. Some of our ing. We utilize our database and send
February guests routinely book a week for their letters of invitation to our regular
We have offered a Valentine’s pack- family vacation. Some just come for hunters in August, giving them ad-
age including chocolate and cham- the weekend. vance preference for a 3-day lock in.
pagne. Norfolk Southern railroad and July As is practiced by our competitors,
utility workers dealing with winter we do raise rates for these high-
storm damage have stayed in the Construction, 4th of July brings guests demand periods. We have no trouble
past. We offer third-party billing for to Emporium. Our website has gener- operating at full capacity relying on
these workers. ated reservations and stays from peo- our regular hunters and new custom-
ple from Germany, Ireland, Switzer- ers as well. We also have set up the
March land, Korea, Australia, China and Den- carport to accommodate electric, wa-
As winter weather abates, people mark. Several summers ago, two Ger- ter and sewerage needs for RV’s as
start moving again. Many will visit man teachers touring the US for 3 needed.
their cabins for repairs and renova- months stayed with us on 3 separate
tions, but will often stay with us, occasions—citing the area reminded December
rather than risk turning on water only them so much of home! Emporium Once hunting season concludes, the
to face a late spring freeze. Construc- has hosted the State Senior Division business falls into about a 3 month
tion projects begin and some visitors Little League Championships for much needed lull—but we still have
seek out the elk. nearly 20 years, bringing 4 teams and customers. Out of town family mem-
April their families from across Pennsylvania bers returning home to visit relatives
to our county. and folks who just
Fishing season is really the start of the want to get a way for
tourist season. Easter often serves as August
a quiet, inexpensive
the official beginning of spring. Peo- Families finish up vacations and stay in the country.
ple begin to book rooms for class and prepare for fall. Elk watchers
family reunions, weddings and begin in earnest. Cameron
graduations. Emporium Country County Fair and Weekend in the
Club, rate 3.5 stars in the Golf Digest Wilds.
attracts local and international golf- September
ers. We’ve hosted golf guests from
Canada, Australia, Japan and Ger- Labor day marks the end of the
many. summer vacation season,
Year after year, hunters stay with us regardless of the
but tourists continue to level of their hunting success. They say they like our
arrive through Thanks- friendly service and the peaceful surroundings of Cam-
BUYER’S INFORMATION PACKET
Prospect Motel
673 Sizerville Road
Emporium, PA 15834
(814) 486-9035 We hope you have found this information helpful in un-
Owners: John & Teresa Genaux derstanding the business side of owning and operating the
Mike & Robin Kuleck
Prospect Motel. If you have further questions, please don’t
hesitate to contact us. Our goal is to sell the motel and
make the transition to new ownership in a manner to
maintain it’s current and future profitability.
We’re on the web!
www.prospectmotel.com
We were “GREEN” Before it was popular!
We try to be environmentally were transients passing through,
friendly, limiting our laundry to full families visiting town during a fu-
loads. By collecting plastic, tin, pa- neral, families celebrating gradua-
per, glass and aluminum, we reduce tions, weddings and reunions, and
the flow of solid waste from our people whose cars have broken
facility. Unoccupied room thermo- down. We’ve made lasting friend-
stats are set at 55—60 degrees, ships beyond the business relation-
which helps conserve energy and ships we have with our guests.
reduces operating expenses.
Over the years we have improved
the grounds by planting perennials
which require minimum mainte-
nance. Many guests have com-
mented on the improvements they
see with each visit. Some have even
seen the hummingbirds and other
colorful birds at the birdfeeders.
Running an operation such as a
small motel is work, but the rewards
go far beyond money. We feel
we’ve helped people whether they
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