I’m not sure whether writing this down will help, but I won’t know unless I try.

We visited the Post Office last week and were getting excited about it. Whilst I was away, I also discovered that a guitar-playing friend of mine happens to be a chartered accountant and he very kindly offered to cast his accountant’s eye over the numbers for the business. I spoke to him at length last night and he believes that the business is overvalued quite considerably and that we should be offering about £50k rather than the asking price of £90k.

I clicked a link he sent which showed various Post Offices for sale, and, judging by that, it doesn’t look like ours is expensive. But, looking at our numbers again, it seems that the net profit as it stands today would not sustain a family of four whilst paying back a considerable loan and it’s breaking my heart. The reason for moving is not primarily to make money; it’s a means of getting to the place where we have dreamed of living for a long time now. But having said that, I do not want to spend the next 10 years being miserable because we have no money. That would be worse than the position we’re in now. I know that money doesn’t bring happiness, but the lack of it can sure bring misery (and I know from experience that that is how I would feel).

My accountant friend has asked that we get the full accounts, rather than the extracts that we were provided with, so that he can look more closely. I pointed out the potential for increasing the net profit, to which his response was that we should not be valuing and paying for potential, but only paying for what the business is worth as it stands today.

The latest year’s figures should be available any day now, so I guess the thing to do would be to request the full set of accounts for the latest year and for the previous two years and then take it from there. The problem is the worry that somebody else will get in first and we’ll lose our dream, but I suppose we really ought to be looking at everything as closely as we possibly can before putting in an offer. Alternatively, we could offer considerably less than the asking price and see what happens, but I’m a bit nervous about doing that and either losing out to someone else or offending the vendor.

We don’t actually know how the vendor came up with the figure that she did, so it might very well be the case that she’s chancing her arm to see if there is any interest at that price, in which case if we offer less than the asking price but it turns out to be the only offer, it could work.

I feel that, based on the current net profit of the business, if we were to borrow what we have applied for and pay the asking price, we would be stretching ourselves too thinly for the next 10 years (which is the term of the loan). We would have very little room for manoeuvre and have next to nothing with which to improve the business. My fear is that the asking price is too high, but there’s just no real way of knowing. Up until now, we have been concentrating on how we would improve the business and looking for ways to increase the net profit; but, as my accountant friend points out, that is mere potential and we shouldn’t be paying for that.

I suppose that last night’s discussion with the accountant has knocked the rose-tinted specs right off my nose and I’m only now seeing the raw data, as it were, without taking into account the emotional attachment. And as the accountant told me, that is how accountants tend to see the world, at least in the business sense.

So what, dear friends, are we to do? It’s a dilemma to be sure.

 I guess the next steps should be these:

1. Request the full accounts for three years (including last year’s figures which are hot off the press and we don’t yet have);

2. Make a spreadsheet of other leasehold Post Offices for sale around the country, entering their data for the sake of comparison and get a feel for how these things are valued.

3. Try to stop worrying quite so much about it.

There, did that help? D’you know what? I think it did.