Robert Carlson built Country Lanes North, a 24-lane bowling facility in Duluth, Minnesota, with two partners in 1976. Over the years, Carlson bought out his partners and brought in his two sons as part owners. Elder son Scott, who began working in the business when he was in high school, has been running the place full time since his dad scaled back a decade ago. Scott Carlson says he has considered taking on a loan to buy out his father and brother. But he is also prepared to sell outright. "I have always worked for my father," he says. "Now, it's time to cash out and let him enjoy his retirement."
The 23,000-square-foot bowling center is one of five similar businesses in the Duluth area. The center includes three outdoor sand volleyball courts, two bars, and a restaurant. About 55 percent of revenue comes from bowling, 34 percent from food and beverage sales, and the rest from the pro shop and volleyball court rentals.
Scott Carlson, whose bowling average is 220, says selling the family business would be bittersweet. He says his ideal scenario is one in which a new owner would want to keep him on as full-time manager. "I've been living my dream here, and I would like to keep living it," he says.
Price Rationale: Bowling centers, says Sandy Hansell, a broker in Southfield, Michigan, are typically worth about two times annual revenue, which makes the offer look a bit pricey. But the deal also includes 2.5 acres of land.
The Cons: Revenue peaked in 2003 at $1 million, suggesting that other forms of entertainment are attracting bowlers' time and money. The center will need to replace its original hardwood lanes in about six years with synthetic surfaces, at a cost of $120,000. Pro-shop business has suffered from online competition.
The Pros: Bowling generally does well during down times, and 2009 is looking strong, as revenue is up nearly 30 percent through April. League bowlers and tournaments bring in steady revenue. The lanes are close to one of the biggest and most visited malls in the region.
The Bottom Line: Country Lanes North could be a good purchase for someone who is willing to invest in improvements and who wants to live and breathe bowling.