Rerun Episode – Buying a Seasonal Christmas Tree Business in Utah

0:00Are you ready to buy a Christmas tree business in Southern Utah County? It could be a nice, interesting sort of side hustle. It doesn't produce a whole lot of cash flow, but it's interesting. At first, I was like, I hate this so much. Everything about this is terrible. But then as you kept reading, I think it might not be terrible. Welcome to Acquisitions Anonymous, the internet's number one podcast today about a Christmas tree lot for sale. So I'm your co-host, Michael Gredley. Myself, Bill, and Heather had a great time talking through a Christmas tree lot for sale in Utah. And if not any of those things scare you, you should definitely listen to this deal.

0:39There was a lot we liked and a couple things that I totally hated. So what's new me hating a deal? Anyway, here it is. I hope you enjoyed as much as we did and let's go. Hey everybody, if you've listened to the show, you've probably heard us talk about franchises. While franchises can be a great path to business ownership for the right person, there's a lot of pitfalls. And it's important to be really careful as there are certainly good franchises to be in and bad franchises that you don't want to be in. Conor Gross is a friend of the pod and a resident expert on franchises. And Conor not only owns and operates his portfolio of multiple franchises, but he's also a franchise consultant and helps others work through while picking the right franchise for them.

1:18So as he's sponsoring today's episode, everyone should totally click in the show notes below to join Conor's newsletter and attend one of his gateway to franchise ownership workshops. If you're ready to move and move quickly, schedule a call with Connor and his team today. All right. Who's ready to record a Christmas episode? Merry pre-Christmas. This episode is coming out after Thanksgiving. So it is Christmas. Let's do it. Well, it's the thing you don't think about, when people release Mariah Carey or those Christmas extravaganzas that are those big shows that they have on TV, they probably started working on that sometime in may they recorded it in in in september and it's been getting edited for the past two months and so there's some poor suckers who are celebrating christmas in september and uh that includes us today just like us yeah i you know that movie uh red one that all the previews are out for right now it's the christmas movie with uh i don't know all the famous people in it but i picture them like you know in march or april recording this You know, like there, it's not at all, you know, dress as Santa Claus, like the whole thing in April.

2:26Yeah. But they are, that's what you got to do. Indeed. Indeed. Indeed. Well, I brought, since it's, since it's the week before Thanksgiving, I brought a Christmas deal because that will show up when we edit this and it comes out a month from now. Do you guys want to talk about this? Let's do it. Yeah. Merry Christmas. Merry Christmas, everybody. Merry Christmas. Happy holidays, et cetera. Okay. So this is a seasonal Christmas tree business located in Utah County, Utah. And it says it's relocatable. So we'll see if that happens. Asking price is$65 ,000 and cash flow is$29 ,000. So they are charging approximately two times cash flow.

3:03Gross revenue is$85 ,000. Inventory is$1 ,750. EBITDA is not applicable. It was established in 2013, and it has$2 ,000 worth of furniture, fixtures, and equipment. It is time to start Xmas planning is the headline here, Heather. This long-established Christmas tree business in southern Utah County has a loyal customer base. The business uses high-quality trees sourced from trusted suppliers in Utah to provide a high-quality Christmas tree buying experience. Customers rely on them to provide a fun family experience and an authentic Christmas tree year after year. It has six employees. Inventory and furniture, fixtures, and equipment are included in the asking price.

3:44Most of the stuff is in good condition, it says, and operates out of the people's home. and it is a perfect opportunity for a buyer who can work and or staff the business during the holiday season and grow the business. The buyer would need a place to store the trees and to sell the trees from. Ideally, this will be in southern Utah County to take advantage of the current customers. This is a business with potential for growth that has already developed a dedicated following and positive reviews. The loyal following and reputation for fresh Utah-grown trees has enabled this business to differentiate themselves.

4:17Their trees look better and last longer than trees brought in from out of state. The owner is willing to provide seller financing with a$10 ,000 seller note, an interest rate of 5 % in a 12-month term. That would make your monthly payments$856.07. The seller will offer two weeks of seller trading, and they are looking to sell this business because they want to pursue other interests. All right. Heather, are you ready to buy a Christmas tree business in southern Utah County? I probably am not, but this is interesting. I don't think it is not relocatable other than maybe you'd move the lot where they sell the trees from every year, but you probably want to be in generally the same area.

5:02And it seems like kind of a supply side business is my guess in that they have access to local utah trees through a farm through a farmer uh and that's kind of the key to this they've got to secure the the access to the trees and they've got to get a lot set up and get up get the tents up and you know put a staff in place for the i don't know how many weeks it is eight weeks how many weeks do you sell christmas trees a year um not even not even eight six maybe Yeah. Six weeks seasonal business. So, you know, it could be a nice, interesting sort of side hustle. It doesn't produce a whole lot of cash flow, but it's interesting.

5:43For those people that say this podcast only does multi-million dollar businesses for, you know, institutional capital, here's a business you can own for 60 grand. Okay. This is a small business. uh i so i read that michael you're reading this and at first i was like i hate this so much like everything about this is terrible but then as you kept reading i think it might not be terrible uh here's why it's they're they're asking 2x and i think you would negotiate from there yeah what this probably is is somebody who has an in with a christmas tree farmer or two right and has an in on how to get an empty lot on a short-term two-month lease somewhere nearby right in salt lake or whatever whatever utah town this is in and it's a it's arbitrage i mean you buy it from these christmas tree farms who they want to grow trees they don't want to sell trees right they want to grow trees up in the mountains they don't want to deal with staffing a lot in salt lake city right so you're buying trees wholesale you set them up in your lot you dress up like Santa Claus and you sell people Christmas trees, right?

6:51I mean, this is like tried and true as a business model. And I don't think AI is replacing it either. So, you know, you buy this for one year of cash. I always think buy versus build, right? Yeah. In theory, you could replicate this, but like at the same time, if it's in this lot every single year and people kind of know to expect it. You know, this guy said he started in 2013. You can look at a lot of history, 10 plus years of history. And if this thing is stable as heck, you know, okay, pay one and a half times cashflow for it. Maybe not bad. I would love it if it were bigger, but maybe not bad.

7:34So I looked up Utah County and I pulled it up on the screen here. That is South of Salt Lake City. So it's the county down towards like Lehigh, Linden, Orem, Provo, that kind of stuff. So it's south of Salt Lake. But you're not like, well, some of the stuff we've looked at before, which is like down here, like St. George, Utah, ain't not much down there. So you're at least somewhat close to civilization and people and all that kind of stuff. So this may be whoever's doing this is somewhere around Spanish Fork, Provo, American Fork kind of deal, I'm guessing. Yeah. Provo is right at the base of the mountains.

8:12BYU has a, has an ETA program and a, and a conference there. It's actually gorgeous campus, right? Like you look out the door and you're, you're looking straight at the mountains and a lot of little bedroom communities right there. It seems like a pretty good population for a business like this. All right. I'm going to bill. I'm going to tell you why this sucks. All right. Oh, I, Michael is so traumatized about businesses where you can only sell for eight weeks a year. Oh, yeah. Seasonal. Unleash the trauma, Michael. Let's just hear it. Seasonal Business Anonymous. Look, here's the problem with this business.

8:48They buried the lead, but it's right here. The buyer would need a place to store the trees. Okay, cool. Like, got you. That's fine. And a place to sell the trees from. And like, just like any other retail business, do you know what matters? Where your business is located. The place. What were you saying? The place. Oh, the place. Location. Location, location, location. That's what matters in retail. And this business does not have a location. So you want me to pay two times earnings for basically$2 ,000 worth of equipment and no place to sell and no established customer base. And I don't know about you guys, but I sure as heck am not driving 100 miles to go buy some Christmas tree just because it's from Utah.

9:34all um so it's anyway i don't i they had me excited about this bill until there was like no place to sell the trees from like because the hard part is getting a location with you know in theory i'm buying a built-up location that has customers and they're offering none of that so i agree completely if this is if you don't get the look if this hasn't been in the same lot for 10 years and you can continue to be in the same lot for the next 10 years it's doa yeah it reminds me a little bit of the pop-up Halloween costume stores. I have looked at these before and a lot of them do not have a standing lease.

10:07However, they don't need a lot. They just need a retail location. There's plenty of vacant retail these days and I think it's a little bit easier. But, you know, location matters a lot to them too. And so I do think that's kind of how these businesses operate. They don't know exactly where they're going to be able to put their business for that six weeks of the year every year. And it changes every year. Heather, you know I was in that business for a while, right? Like 15 years ago? The pop-up Halloween business? I was in the pop-up Halloween business 15 years ago? No, I did not know you were in the Halloween business.

10:38Oh my God. I was in it 15 years ago. So the most fascinating thing about the pop-up Halloween business, unlike say pop-up Christmas trees or pop-up fireworks, is there is just such a massive economy of scale that happens with those businesses, which is why basically the pop-ups there is spirit halloween and nobody else like it's just totally fascinating we we ended up building our operation up to 12 stores that was our biggest year and we did pretty well um we would do 200 to 300 000 a year per store out of halloween stuff and it was pretty amazing and what we discovered was we were getting eaten from the bottom by walmart and target right because because the dynamic uh and and we're getting eaten from the side by spirit so basically the way it works is like in modern society there is like a hot costume that every like eight-year-old to 12-year-old wants to be or let's say five-year-old to 12-year-old they all want to be spider-man and that's what you want to be so what ends up happening is if you want to go buy those like spider-man you can only get spider-man as a licensed costume right it's copyright it's copywritten and what those guys did which was and still do which was the dumbest thing ever because they just destroyed all the independent retailers was they would give target and walmart special cheaper made costumes that they could sell at price points they wanted to so let's say ten dollars would be the retail for a spider-man costume at walmart it would be cheaper than the one that the company that had the license for Spider-Man would turn around and sell to independent retailers.

12:17Like Walmart would be selling them for cheaper than we could sell them because it was a different model, but it looked the same. And also they give better pricing to Walmart who would take it from China directly. So like I remember sitting down with the distributor once and I was like, you know, you guys are killing all the independent distributors by doing this. Like you're giving Walmart a different deal than you give to all of us and you're making it impossible for us to compete. We're all going to go out of business and all you're going to be left with is Walmart, Target, big retailers, and Spirit, and they're going to just kill you on prices, and you're going to go out of business.

12:47And they looked at me, and they were like, thank you, sir. That's very nice. And then I looked up about three years ago, and guess what happened? The assholes went out of business. I was sitting there telling you. I was like, you're going to die. They're going to kill you. You're killing yourself. Yeah. Yeah. And anyway, we died sooner than they did, though. So we gave up. I did not know about that. Wow, that is fascinating. But did you always have a lease? Did you always have a location or did you have to scout one out every year? We tried two different things. We tried putting them in fireworks stores, which sometimes worked.

13:21But generally, all the fireworks people have discovered not to do that. And most of them don't do it anymore. So we tried that. But then where it really worked is we would go do what Spirit does and go lease unused space. And it's surprisingly easy to do. That was not the problem with the business. The problem was on the supply side, not on the location side. I kind of feel like the Christmas tree business, though, is better than the Halloween business. Oh, yeah. In that you don't need nearly the variety, like the skew count. You have one skew. It's a tree, right? And you can probably, because this is local Utah, you can probably get a semi-just in time from the tree farm, right?

14:02You could probably even negotiate, like, whatever we're left at the end of the season, you eat. We give it back to you or something. So like you don't have this massive working capital risk, you know, like you have in Halloween. You don't have this massive kind of like complexity style fashion fad risk like you have in Halloween. It's pretty much just in time. You just double the price and you sell as many as you can, but it comes back to location. You got to be in the right spot where your consumers know it's going to be. And it also comes back down to staffing, right? Because I don't think you want to be wearing a Santa hat slinging Christmas trees for six weeks a year, which is probably functionally a full-time job or definitely a nights and weekends job because that's when people want to buy Christmas trees and prevent you from doing anything else.

14:47Hey, Michael here. I want to talk to you about the one conference year I go to. And the reason I go to it is because I created it perfectly for myself. And it's called HOTCO Conference. And this year, it'll be again at the Sundance Resort in Utah. And it's hands down one of my favorite events of all time. It is for people that have an aspiration to be involved deeply in multiple businesses, whether that's you on your first business or your zeroth business or your 10th business. This is a great place to come and meet like-minded folks who are not just operating one business or owning one business.

15:19They're involved in multiple things. And it was so good last year that we sold it out. The community loved it. And we're doing it again this year, February 9th through 12th, 2026 in Sundance in Utah. Everything is included, conference, skiing, meals, rooms, spa access. You literally just show up and talk to a bunch of other smart people and learn from them. Tickets are available at holdcodeconference.com. It's intentionally small, so please don't wait. We're almost sold out, but we're pushing towards the end. And again, that's holdcodeconference.com. Check it out and love to see you there. maybe say if you already had a business that sold something else seasonal you know like uh in july or around new year's you could use some of those same people to staff like this is a nice add-on for another seasonal holiday business what do you think michael yeah that's definitely an option what one of the challenges there is people tend not to want to do this type of stuff around the new year's holiday and the christmas holiday for two reasons one is the more obvious one they want to hang out with their family and stuff like that which is very different than you know say fourth of july where they're like oh yeah i got nothing to do fourth of july i'll go i'll go i'll go grill out in a camper next to a stand or a tent full of explosives the but the the actual bigger problem with getting people around this time is the weather.

16:46And so if you have a tent set up like this where you're selling fireworks trees or selling trees outside of Orem, Utah, do you know how cold it is in the winter in Utah? It is not pleasant. So you're freezing your butt off. And I have some stories about sleeping next to a fireworks stand for New Year's Eve when I was a kid. And it would be like 30 degrees. it's not that nice it's not not good um so yeah so but i you know it's an interesting thing about the fireworks business bill that people have tried to come up with seasonal stuff like over and over again to sell besides fireworks and we all end up just selling fireworks like fireworks is the best seasonal business everybody everybody who's a fireworks vendor who tries to get into other stuff, whether it's like roses for, uh, roses for Valentine's day, trees, Halloween, like everybody tried everything and they all end up like trying these things.

17:41And for the first few years, they're like, this is great. I'm getting revenue other times. It's going terrific. And then like three years later, you're like, they're like, yeah, I'm done with those trees. That was horrible. Never doing that again. So go back to fireworks. So it's, it's better just to like spool up the whole operation for the 4th of July, close it down till New Year's, spool it up and just work three, two weeks a year and call it good on fireworks, which is the best seasonal thing. And don't screw around with Christmas trees or Halloween costumes or whatever. I want to believe that's not the case, but in practice that keeps happening over and over again.

18:14So, well, and isn't this the kind of business that maybe is better to start up than it is to buy? You know, if you don't have a lot and you've got to hire new staff every year, The only thing you're missing as far as a startup is you've got to go develop the relationship with the farmers and figure that out. But if you go do that, you could just start it, couldn't you? Well, yeah, that's what I was getting at. Like you could start it, but if it's cheap enough – I mean you pay one times earnings, right? Because this guy would rather not just shut it down. He basically wants to get paid to not work for one year.

18:46You work one year for free, and you get to step into his relationships with the tree factories. You get the relationship with the lease because it's in the same parking lot every single year. You know, it might be worth one year profit to not bother standing it up. You know, all the employees, the seasonal folks he calls every single year. Like, you know, when it gets cheap enough at some point, it's easier than starting. Yeah. But that's really what you're buying is the guys to call. Here's the list of the customer or the vendor, the landlord and the staff. That's it. That's what you're getting.

19:24That's it. Yeah. And you want to make sure that they're willing to do business with you as well. Right. Cause if landlord guys like, nah, I drank beers with that guy at the bar. There's only reason I gave him a sweetheart deal. The wrench is doubled. Now you have a problem because you definitely don't have a long-term lease because it's a, you know, it's a seasonal lease. Yeah. So there's a lot of risk in it for that. Yeah. Yeah, exactly. And if they're, I mean, if it's staffed by mostly family members, you're probably not going to get that staff no that's the other problem that's the other problem who's staffing it this is we're in a business with thirty thousand dollars a year of cash flow the difference between ebitda and sde can be miles yeah yeah can we talk about tailwinds and headwinds on this business like like what do you guys have do you guys do real tree or do you do plastic tree at your house we do plastic tree okay so i am a real tree purist we i spend an absurd amount of money i mean i could have paid for many plastic trees with the amount of real trees that i have bought but there is something of the christmas spirit in a real tree like you have you have kids like it smells nice in the house you know they get to go pick it out we're actually doing that this weekend we're going to pick out the tree can't put a price on that and it smells so good it does i love the way it smells.

20:42It does. The older I'm getting, the more I love the holiday season. It's just a matter of time. Michael's getting misty. It's just a matter of time until I move to Fort Myers, Florida, sit in a condo on the beach, look at my tree. You're already wearing a festive red shirt and it's not even Thanksgiving yet. Heather, are you a real tree purist or are you part of the plastic tree army? I have a plastic tree. I'm sorry to admit. I started it when the kids were younger. And for me, Christmas has always been a stressful time of year because I'm in the loan business and we're always super busy around Christmas with work.

21:21So I never could really, like anything extra to have to do around Christmas actually just felt stressful. Now I should probably switch back to a real tree. I could, I could handle it again now, but I feel like I have to use the plastic tree because I have it. Even though I don't have to use it. I feel like I have to. All right. Can we switch to something else? Oh, the tailwinds and headwinds. Let's finish talking about that. So do we think young people are going to continue to be buying fresh trees? Do we think that there's a worry about environmental concerns, any of that kind of stuff? I think you can kind of justify it as a kind of environmental thing to do because they're planting trees, the trees are growing, and the farmer's not going to grow these types of trees if people aren't buying them.

22:03I don't think there's an environmental concern, especially in an area like Utah, where they probably can just use the water from the sky. I don't know. I don't think young people are going away from this. So I just chat GBT'd this while we were looking. And actually, weirdly, it searched the web and cited its sources, which is new. Every time I open chat GBT, it does more shit. So this says, yes, Christmas trees, Artificial trees are becoming increasingly popular. In 1992, about 46 % of U.S. households displaying Christmas trees used an artificial tree. By 2004, this figure had risen to 58 % artificial trees.

22:42And a 2018 survey indicated that approximately 75 % of Americans who have a Christmas tree now opt for an artificial one. That seems like a massive jump to me. I did not realize Bah humbug was taking over America. Yeah. So it is dying. It is sort of a... It is shrinking. Yes. Demand is shrinking for sure. Interesting. Bill is such a throwback. It's your purest nature. All right. Let's talk about the other piece of thing in here that's just a total piece of BS, which I don't buy at all. All right. It says, this business uses high quality trees sourced from trusted suppliers in Utah to provide a high quality Christmas tree buying experience.

23:25and they make them make you think that this is like a competitive advantage i am willing to wager whatever you guys want uh that within a week uh i could have an entire trailer load of christmas trees booked and ready to show up for me that would be just as good as these if not better i bet you there are a hundred farms that have christmas trees that i could buy and i could get them here in time for opening up next week right after right here in this case being crovo Utah. Yeah, Provo, Utah. I mean, it's just a truck ride. I mean, all the Texas trees come from Oregon. They all get chopped down there and they drive them down here.

24:00So yeah, I know a little bit about this actually living in North Carolina, which North Carolina produces some incredibly outsized portion of the America's Christmas trees. Right. We have a huge number of Christmas trees in North Carolina. And so like anything that is big, heavy, and bulky, freight is a major part of your cost structure in a christmas tree right so we have cheaper real christmas trees here in the carolinas than maybe you do michael say in texas uh because christmas trees grow in kind of cold mountain climates right yeah um evergreen trees so uh it might be a little harder than you think to uh or probably easier than you think because there's probably a whole bunch of trees right there in Provo.

24:46And it's just a matter of calling somebody and, you know, buying some, but you probably can't necessarily parachute them into San Antonio, Texas as easily because of all the, right? Yeah. Ours get, I haven't bought a real tree in a while, but usually I would, I would go and do the girdly business nerd thing and start asking the people their gross margins and stuff and where they get their trees from, you know, cause that's what you do when you go to somebody's random business and buy try to buy a$200 tree. Um, but, uh, they had told me they were sourcing them that the pines and whatever they were sourcing them from, from Oregon, they would come down.

25:22I think to your point, Bill, like, I think people don't really understand how special the Southeast of the United States is for lumber production and how much lumber we produce. Like people do not, do not understand how perfect the Southeast is for growing trees and producing lumber and all that kind of stuff like i've done some research into it it's insane in terms of how quickly we can grow lumber there people think it's from the pacific northwest it absolutely is not it's coming out of georgia florida south carolina all that kind of stuff georgia pacific one of the largest tree and paper product companies in the world named georgia pacific for a reason uh but yeah we have beautiful christmas trees here in the southeast all right any more discussion about this otherwise i'm ready to deliver a verdict if it's not already a surprise, not a surprise.

26:09You're ready to poo poo on it. Um, I, I will. So I don't know that I hate this whole category, but I think you got to pick your spot. I, this one may be less good because it doesn't seem like have a specific location here in Charlotte. I will tell you the flip side of this coin. There is this one Christmas tree place that's on the, it takes over the farmer's market. Like there's a lot in town that is like usually the farmer's market. And then in November, December, it becomes the Christmas tree spot. These people print, I mean, they are running trucks like every day from the mountains of North Carolina.

26:44And like, you can't get a parking spot. I mean, it is unbelievable the volume of trees they move through this lot, which is probably, I don't know, five to 10 ,000 square foot lot. And it's gravel, like there's no infrastructure that, you know, they're just trucking them in, they stand them up, it sits there for an hour before it's gone. And I bet that is a great business. All right. I will one-up you now, and I will tell you the greatest Christmas business I've ever seen. Greatest Christmas. It is this place. Okay. You know where Texas A &M is located? I'm looking at Heather. Heather, do you know?

27:21In Texas. Okay. Heather, do you know where Texas is? It's like far east Riverside. Okay. You just keep going to Riverside. In the middle down south. Yes. It's where the cows are and the oil comes from. Okay. Right. So there's the triangle of Dallas, Houston, San Antonio, right? And then Austin's on one of the edges. There's this kind of place in the middle west of Houston called College Station where Texas A &M is located. It's our historical kind of agricultural mechanical university. Believe it or not, Bill, my grandfather was captain of the 1939 national champion Texas A &M football team. His name is Bill.

27:59He'll hold on to that. Generation later. his nickname was pinky so there you go um so so i was driving through uh brian a couple years ago down this highway called highway six and college station so there's brian college station the two towns together and i see this line of cars that literally bill is like four miles long to get into something like it's like pet adoption day at the natural dog code like that's how crazy it was and um everybody was lined up at this place called santa's wonderland to get into it and it is basically a theme park that they have built that is totally christmas stuff and i'm pulling up the pictures here uh for those of you online and everything's lit up like they're selling you eggnog like the whole thing is just like crazy so here's an aerial picture of the thing um and i'll pull up the website here uh but they were just like you do horse and carriage rides ice skating and then you could buy a season pass if you want to come back to celebrate the holidays more than once i'm coming how long's the drive to college station texas or north carolina i'm bringing my kids i'm all in so it's far so to get in is 56 dollars to get into this thing um yeah yeah they start right around now so today they would have opened up yesterday november 25th and you get into the wonderland emission the dazzling trail of lights a hayride snow play thrilling snow tubing naughty or nice list enrollment heather perfect for you four rides four rides the most texas thing ever um but just crazy like but they must have had several thousand people going through this thing bill i mean it was just insane um oh i was sharing no marginal cost either no a huge fix yeah huge fixed cost no marginal cost that looks fine but yeah i mean look you can see here the picture of the aerial i have my mouse over it uh there must be 300 cars just in the picture we have and a line to get in just totally crazy this sounds awesome i love it yeah ice skating so but But yeah, I mean, it's just one of those dreams you have, right?

30:20You bring in 3 ,000 people a night at$50 a person, right? And you're just printing money. And then you just shut her all down and lock the gate. Just dormant for 11 months a year? It's a permanent installation. There's just nothing there. Oh, that's interesting. I feel like they should sell some fireworks out of there for the rest of the year or something. There's actually a firework store down the street. So I can tell you where it is. Yeah, so here's the park map. It's basically like Epcot for Christmas. Yeah, that's cute. I'm into it. This is great. Yeah. Yeah, and they have all the stuff here.