The asking price is only the start. Know your real entry cost.
A takeover listing shows the key money. Add the deposit, fit-out, licences, opening stock and your first months of rent and running costs, and you have the cash you actually need. Enter your numbers and see it in a minute.
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Example figures that show how the calculator reads, not market prices. Change any number.
Your real entry cost
2.3× the key money The key money in the listing is only 43% of it.
| Item | Amount | Share |
|---|---|---|
Key moneyPaid to the seller | HK$180,000 | 43% |
Deposit3 months of rent, held by the landlord | HK$54,000 | 13% |
Opening costsFit-out HK$30,000Licences and fees HK$15,000Stock HK$10,000 | HK$55,000 | 13% |
Running reserve3 months of rent and running costs | HK$129,000 | 31% |
| Real entry cost | HK$418,000 | 100% |
Payback check
The lease may end before you break even
At the expected profit, the HK$225,000 you cannot get back takes about 11 months to earn back, but only 10 months are left on the lease. Negotiate a longer lease or a lower price before you sign.
Key money, fit-out and fees stay behind when you leave, so they have to be earned back. The deposit and stock are not counted.
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Seven questions to settle before you pay any key money
- 01
Show me the real numbers
Ask for 6–12 months of sales records and bank statements. A figure said out loud or a till screen is not evidence.
- 02
How long is left, and will the landlord agree?
Check the remaining term, the renewal terms and any rent review. Many leases need the landlord’s written consent before the tenancy can pass to you.
- 03
What does the key money actually buy?
Get an itemised list of the fit-out, equipment, stock and goodwill included, and check their condition before you pay.
- 04
Do the licences transfer?
Some licences cannot simply pass to a new owner. Confirm with the issuing department before you commit.
- 05
Are there unpaid debts?
Ask about rent arrears, wages, supplier bills and tax. Under Hong Kong’s Transfer of Businesses (Protection of Creditors) Ordinance (Cap. 49), a buyer can become liable for a business’s existing debts, so ask a lawyer about the transfer notice.
- 06
Will the seller reopen nearby?
Agree in writing that the seller will not run a competing business nearby for a set period.
- 07
What happens when you leave?
Many shop leases require the premises to be returned to their original state. The cost usually comes out of your deposit.
Keep every rent payment on the record.
Speedly keeps each month’s rent, due date and payment proof in one record that tenant and landlord both see, so nobody has to ask whether the rent was paid. Ask your landlord to add your tenancy: landlords are free for up to 3 tenancies, and tenants are always free.
How the calculation works
- Real entry cost = key money + deposit + opening costs + running reserve.
- Deposit = monthly rent × deposit months. You get it back when the lease ends, less any deductions, but you cannot spend it while you trade.
- Running reserve = months × (monthly rent + other running costs). It includes the month of rent usually paid in advance on signing, so nothing is counted twice.
- Payback = (key money + fit-out + licences and fees) ÷ expected monthly profit, rounded up to whole months.
An estimate for planning, not investment, legal, tax or financial advice. Your figures depend on your own situation; speak to a lawyer or accountant before you sign a lease or a transfer agreement.