Disclaimer: I’m not an attorney or CPA. Consult professionals before making any decisions.
Some owners push the “one LLC per location” approach.
“This gives me maximum protection!” (which is probably true)
But what they don’t tell you is that protection comes with a massive cost.
It creates admin overhead that will crush your soul.
Picture this:
You start with a single LLC: “Midas 2322 LLC”
For that entity, you need: EIN, state registration, operating agreement, sales tax ID, tax return, payroll processing, bank account, credit card, liability insurance, QuickBooks account, etc.
That’s just to start.
Now you buy a second location and form “Midas 2324 LLC”
Same drill. All over again. Still not a big deal with 2…
Now multiply by 5 locations, 10 locations, 35+ locations
What happens when you transfer an employee from one location to another?
You have to terminate him from the Midas 2322 LLC payroll and hire him from the Midas 2324 LLC payroll.
What about when one location has a massive insurance claim and gets dropped by the carrier?
Now you’re forced into an expensive high-risk policy for just that location.
A larger policy might have absorbed that claim with a manageable loss ratio.
This creates a lot of admin work that falls on the owner’s shoulders.
It’s one of the biggest pain points for multi-unit operators.
Instead of focusing on driving sales, you’re filing sales tax withholdings multiple times on the 1st, then again on the 15th.
But what about the liability protection?
Two solutions:
1. Buy insurance (lots of it)
General liability + umbrella policy + employment practices liability.
Add a personal umbrella to your homeowners policy
It’s cheap. $400/year for $3M coverage)
2. Use common sense
Don’t combine real estate with business operations.
Don’t take shortcuts when it comes to safety.
Background check all employees.
Install AI dash cams in every vehicle.
Install high-quality security cameras at the business
Your structure should make operations easier, not harder.
So what’s my recommendation for the optimal growth?
I’m saving that for Tuesday’s Cash Flow Club newsletter!
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Cheers!
Brian
