Valuation of a hot dog cart business
I am in the process of buying either an existing cart business or my own cart and starting from scratch, haven't made up my mind completely. I live in an area where the foot traffic is not great except in the major downtown area where spots are as hard to get as 50yd line seats to the 49ers. A few larger players have exclusive rights to the big festivals around here, so most of the hot dog cart folks find small niches. The business i'm considering has exclusive rights to a glorious street corner in between about 5 bars with no competition between about 1130 and 2am and lots of foot traffic. My question is what the general consensus is on valuation of such a business. I assume it comes down to some multiple of cash flow.. 3x monthly? 5x? 10x ?? Any input?