I had an interesting conversation this weekend with a friend about buying flyfishing stores-I think the concepts are fairly transferable to dive shops.
1) It is difficult to build a successful business in such niche markets. Even for flyfishing, the internet has cut into local shop's margins, and the downturn of the economy in the late 1990s shut off the flow of a fair amount of disposable income to the sport. I imagine this was somewhat true for scuba diving as well, certainly the first part regarding how difficult it is to build a local business is true.
2) Once built, these things are valued under traditional valuation schemes at a fairly good chunk of cash. The concept we came up with was "do you want to spent $300,000 for a $40,000/year job?" This seems to be the rub, the shop may have a good revenue stream, but once overhead and other costs are taken into account, it seems to me that buying a shop is not a good way to get rich. What could you do with that $300,000 besides buying a shop? Could you make more money without buying the shop?
3) So, considering the above factors, why buy any type of niche market shop (dive, flyfishing, I think this question can be asked about a lot of industries)? I think the answer is because you enjoy the sport. You are buying a job--one that may not pay much--but you are also buying a lifestyle, and that may be quite appealing to you.
Anyways, a couple of factors to take into account. Another is local loyalty. You'll have to either (1) rely upon the existing customer base, or (2) build a new base. For me, I am fiercely loyal to my LDS, and they take care of me in return (more importantly, I like all the people there). Because of that, I'm willing to pay a little more to support the place. If you do buy a shop, I'd think that good marketing and customer service is a must, which doesn't seem to be the case for a fair number of shops (at least if you base your sample on the internet--in reality, I've found most dive shops to be reasonably welcoming and helpful).
My two cents, at least.