Description of Business for Sale- Purple Fiddle LLC

Purchase of 50% of the Purple Fiddle LLC, including 21 East Avenue, 23-24 East Avenue and an additional triangular lot at the end of the street with good visibility from traffic in both directions. Two historic buildings, both located in the Commercial Thomas Historic District, (listed on the National Registry) on four prime lots overlooking the river valley in Thomas WV.  The vacant lot value alone of four lots on Front Street  is $320,000. Commercial properties are selling at $100/sq ft currently, making the PF and B&B worth $850,000 not including the covered patio space which adds additional occupancy to our building.

The Purple Fiddle Coffeehouse and Mountain Market is located in 21 East Avenue, the old historic Depollo General Store. It is 6000 square feet, sits on a double landscaped lot, and has many historical architectural features. It has many upgrades and shows very well. It has a brand new 1600Sq ft covered patio addition that increases capacity by 100. We have had as many as 250 in the main building for shows.

The patio is covered in canvas and heated during the winter. The exterior was completely repointed and painted last year($40,000), drainage/waterproofing issues were addressed($8000), landscaping and patio construction ($30,000) a new metal roof was put on in 2002($8000), and larger bathrooms were installed to better serve our customers($4000). These figures are estimates.

The upstairs of the Purple Fiddle was the owner’s primary residence for five years. It was totally renovated when we took occupancy in 2002. It has 11 bedrooms, two kitchens, main floor laundry, 2 full baths, one with a Jacuzzi, upscale faucets, lighting and appliances, hardwood and tiles floors throughout, a full balcony off the front overlooking the river valley, and is decorated in bright modern colors.

The Fiddler’s Roost is located next door at 23-24 East Avenue. It is located within the Thomas Historic Commercial District, as is the Purple Fiddle, qualifying it for State Historic Preservation grants. Both buildings have had grants totaling $50,000 allotted to them for upgrades. It is an eight room inn, completely furnished with bedding and antique furniture. Two handmade quilts on each bed. It was completely renovated in 2003 when we purchased it. There are 5 full bathrooms and a common living room and kitchen, complete with amenities included. Guests and band members stay at the Fiddler’s Roost, offering a nice supplement to our regular sales, with rooms running $49weekdays and up to -$109 per weekend night.  Sales would increase if bands were charged a nominal rate for their accommodation. Currently most bands stay free.

It was recently changed to an inn, from a B&B, without changing the room rates, so there will be a 20% increase in profits in this category. In addition, John has recently agreed to make the band payment a 70/30 split, rather than the traditional 80/20 split, so we are making more from the door than we did historically. John is planning to rent out the top floor (11 bedrooms) at $400 month to tenants beginning in Nov 2007. This will increase income by a minimum of $1400-$4400 per month, according to his estimates.

The Purple Fiddle is completely furnished with 100 antique chairs, tables, benches, trolley seats, pews, and stools. (Replacement $15,000) The walls are filled with antique memorabilia, old quilts, and merchandise( $10,000). The Mackie/Bose sound system is some of the finest sound equipment available for commercial use( $10,000). There are commercial fridges, freezers, blenders, Italian espresso machine, ice machine, microwaves, steam tables, rice cookers, ice cream dipping cabinet, draft fridge, coffee and espresso grinders, brewers, and countless commercial smallwares and dishes with a replacement value over $40,000. There is a large inventory of gourmet beer, food staples, fresh food, juice, breads, organic coffee beans, flavor syrups, and other menu ingredients with a value of $8000.00

Many of the café fixtures are valuable antiques and high end. The hand-carved bears were $26,000, the low voltage lighting was $20,000, the brass fixtures from a vintage NYC hotel were $12,000, even the pill box toilet tank was $600. These would likely be worth twice that now. Many of the original general store items were saved and incorporated into the restoration. Our customers admire the museum-like nature of the café as much as they do the food or the music. It is the unique historical experience they come back for and talk so much about.

There are several tools, shop vac, air compressor, vacuums, power tools, mowers, and ladders that are included as they are used in routine maintenance of the properties. Estimated replacement value of $3000.00

Sale does not included upstairs furnishings/contents and several instruments, quilts, and certain personal antique items in the Purple Fiddle and Fiddler’s Roost.

The business has a steady customer base that is expected to increase substantially over the next five years, as second home development and cultural tourism increases in our area. The first five years we saw steady growth and with the business stable and operating smoothly, we expect to see increased profits during these next years. During the first years, most of our profits went directly back into the business and into supporting our family. This will change significantly starting on 2006 taxes as Kate and the four children moved out of the home no support was given, and all of the major expenditures for repairs and equipment have been previously addressed by now.

The benefits of the new covered antique brick patio (increased capacity and smoking area) which will be seeing its first summer/fall season this year, and the recent Goldenseal feature should be reflected immediately during this season’s figures. The new base of West Virginian tourists resulting from the Goldenseal feature and the patio space will benefit our sales for many years to come. It is heated in the winter and has custom made sides that attach.

The heavily read Washington Post article in 2004 greatly helped our business. After this five year forecast is over we expect to see the influx of further growth in five-ten years with Corridor H and the second generation baby boomers purchasing their second homes.

This is a difficult area to succeed as a new business in. There are many factors, some being; transient worker population, small applicant pool, and employees with multiple jobs trying to fill the same peak weekend hours. Many of our staff does not have the proper training to work independently. This staff shortage means we are more tolerant of staff incompetence as they are the best employees we can get and they also know this. This will change as more people move to our area.

 There are seasonal fluctuations in tourism and local residents are not our primary customers, so there are many factors affecting a season, incl, gas prices, road and ski conditions, fog, available parking. We are getting better at predicting these patterns and our resulting numbers, but all in all the trend is up and the overall trends for WV tourism, especially in leisure/arts tourism, is spectacular. We see two slow periods, lasting aprox 6 weeks each, April-May and November-December. Summer, autumn, and winter are equally strong seasons.

The Purple Fiddle continues to grow and watches as other small businesses come and go in our area. Other than a few local standbys, new places are opening and closing within a few months.  Even the strongest of all the businesses have felt the effects of the tourism slump this past year, with gas prices soaring and spending down. With Corridor H starting construction in our area, the economy will experience steady growth.

 Even issues of parking have become important to our success, forcing us to rent a lot to combat the city’s parking changes to parallel parking on Front Street cutting our available parking spots in half. For the first time, since we have been established, we are seeing that several Main Street businesses are surviving beyond the season. Downtown is beginning to look inhabited and alive. It seems like it is about to take off.

We have felt the effect of the new businesses in town, but overall we know this will bring more tourist interest to our area and that the outcome is positive for everyone. We support and collaborate with these other businesses to create Thomas more of a destination.  After nearly six years of work and reinvestment of profits to the needs of the business, we have finally achieved a sense of stability and predictability as a business, knowing that it will continue to grow as the area booms in the next few years. Surviving in business here for one year is an achievement, three years is a landmark, and five years is a success.