Business Overview

A well-established donut shop specializing in a wide variety of donuts and baked goods is available for acquisition. This business was originally established by the previous owner in 2005 and was acquired by the current owner in 2014. The business is occupied in a 950 SF space of a retail strip center located in a prime location surrounded by the national grocery market and enormous presence of retail chains with heavy traffic. Various menu items are provided at this donut shop range from coffee, beverages, baked goods such as pastries, sausage rolls, donuts, and crowd favorite croissant donuts; also accepts/provides custom donut orders ranging from kid-friendly custom-designed donuts to birthday letters. A majority of the customers are middle to high-income individuals and families that consist good mix of all demographics that are from the surrounding densely populated residential neighborhood while the Caucasian customers are predominant for this business. About 75% of the customer base is white-collar while the remaining 25% is blue-collar. Few competitors are within the immediate market area, but this business has an edge over its competitors in terms of customer service, cleanliness, and products. This business has built up its solid customer base that has been accumulated in the last 15 years of operation by not only providing a strong product line and exceptional customer service but also providing custom-design donuts that have differentiated themselves from the competition. After the current owner’s acquisition, revenue and public awareness of this business have increased compared to the previous ownership, and the gross sales average of this donut shop was consistently around $30,000/month over the last several years before the pandemic and even after the pandemic, there has been slight decrease to $25,000/month but improving every month. Currently, some marketing is in place through social media outlets such as Facebook and Instagram, but more pro-active marketing methods need to be utilized to achieve maximum income capacity as well as growing the customer base beyond the immediate market area. Marketing efforts on delivery and take-out service including 3rd party delivery can greatly improve the sales as the demand for delivery and take-out service is growing than ever after the COVID-19 outbreak. Focusing on acquiring accounts and customers for catering from nearby corporate offices and headquarters, medical offices, car dealerships, schools, and churches can also have an immediate effect on the overall sales. A well-experienced buyer in this business will be able to reduce the significant payroll expense by not having to hire a full-time baker. This well-established donut shop is perfect for a family and is ready for a potential buyer to be actively involved in the business operation while marketing to grow the business to maximum income capacity.

Listing ID #001026
For more info, please call Kevin Chung at 1-866-519-2421.

Financial

  • Asking Price: $250,000
  • Cash Flow: $118,737
  • Gross Revenue: $352,316
  • EBITDA: N/A
  • FF&E: $5,000
  • Inventory: $3,000
  • Inventory Included: N/A
  • Established: 2005

Detailed Information

  • Property Owned or Leased:N/A
  • Property Included:N/A
  • Building Square Footage:N/A
  • Lot Size:N/A
  • Total Number of Employees:2
  • Furniture, Fixtures and Equipment:N/A
About The Facility:

The business is occupied in a 950 SF space of a retail strip center located in a prime location surrounded by many nationwide retail shops.

Is Support & Training Included:

Owner will provide a sufficient training for an agreed-upon period to make the transition into the business as seamless as possible.

Purpose For Selling:

Other Opportunities.

Pros and Cons:

Competition is expected in this industry, but this business not only offers quality products in a wide variety of donuts and baked goods but also provides customized options for its ingredient and design to accommodate all kinds of customer's preferences.

Opportunities and Growth:

Marketing efforts on increasing catering business to corporate offices and headquarters, medical offices, car dealership, and churches nearby can also significantly improve the sales as the catering business remain untapped. A friendly, fluent English speaker at the register moving forward will also help the business's operation flow much smoother, allowing this business to enhance customer service.

Additional Info

The company was founded in 2005, making the business 17 years old.
The deal won't include inventory valued at $3,000*, which ins't included in the requested price.

Why is the Current Owner Selling The Business?

There are all kinds of reasons individuals resolve to sell operating businesses. Nevertheless, the real reason vs the one they tell you might be 2 completely different things. For instance, they may state "I have too many various responsibilities" or "I am retiring". For numerous sellers, these reasons stand. However, for some, these might just be justifications to try to hide the reality of transforming demographics, increased competitors, current decrease in incomes, or a variety of various other factors. This is why it is very crucial that you not depend entirely on a vendor's word, yet rather, utilize the vendor's response along with your total due diligence. This will repaint an extra practical image of the business's existing scenario.

Existing Debts and Future Obligations

If the existing business is in debt, which many companies are, then you will certainly have reason to consider this when valuating/preparing your deal. Many companies finance loans in order to cover items such as stock, payroll, accounts payable, so on and so forth. Keep in mind that in some cases this can imply that earnings margins are too thin. Numerous organisations fall under a revolving door of taking on debt as a way to pay back other loans. Along with debts, there may additionally be future commitments to take into consideration. There might be an outstanding lease on equipment or the building where the business resides. The business might have existing agreements with vendors that need to be met or may cause charges if terminated early.

Understanding the Customer Base, Competition and Area Demographics

How do companies in the location bring in brand-new clients? Most times, operating businesses have repeat consumers, which develop the core of their daily profits. Certain variables such as new competitors sprouting up around the area, roadway building and construction, and staff turnover can influence repeat clients and also negatively impact future profits. One essential thing to take into consideration is the area of the business. Is it in a very trafficked shopping mall, or is it hidden from the highway? Obviously, the more people that see the business often, the higher the possibility to build a returning consumer base. A final idea is the general area demographics. Is the business placed in a largely populated city, or is it located on the edge of town? How might the regional typical home earnings influence future earnings prospects?