Advice on deal structure?
Hey Ronins! I have this situation… Someone approached me and is very eager to work with me. They‘re running a healthy-margin profitable brick and mortar shop in Germany selling basically types of supplements that are in high demand. Has 150% - 250% margins, very light and small products, and makes about $50k/mo revenue w/ ~60% profit after expenses, just from people walking into the store from the neighbourhood. Good Google reviews, no ads, just word of mouth. He wants me to take the whole biz online for the entire European market and basically split 50/50 of profits from all online biz. But Mojo Travis‘ wisdom is ringing in my ears… „NO new offeeeeers!“ Technically offer is not completely new, demand is proven, and we can bring plenty of the in-store peeps online, while starting. I‘ve got lots of supplements ecom and marketing experience, so this can work, but… …I don‘t want to be a business partner in this sense and be tied up. Would rather settle on a different type of performance-based deal… Maybe revenue-share (not profit-share)? But what percentages are reasonable in that market? 15%? And what if they exit the biz eventually? Any general thoughts or advice? Maybe do some kind of test first? I see potential, but want to avoid commitment traps with some 3rd party biz, so I’m free to do other deals with partners. Tips much appreciated!