Business Overview

While this company’s roots are in flooring, and those products and services are still its primary revenue driver, the company is better described today as a general construction product distributor and installer. The business’ revenue is split fairly evenly between its distribution and installation divisions. On the installation side, the business is almost exclusively operating in the commercial sector – apartment complexes, hospitals, schools and other commercial projects. While the customer base is more evenly split between commercial and residential providers on the distribution side of the business. The business has full-time employees dedicated to each of the divisions, and utilizes a network of literally hundreds of sub-contracted crews with various specialties depending on the projects the business is managing at any given time. The transaction has been pre-qualified for SBA financing for a qualified buyer.

To receive more detailed information about this business, please complete the online non-disclosure agreement at https://sigmamergers.com/nda.

Financial

  • Asking Price: $2,500,000
  • Cash Flow: $581,659
  • Gross Revenue: $4,710,939
  • EBITDA: $491,904
  • FF&E: $260,000
  • Inventory: $500,000
  • Inventory Included: Yes
  • Established: 2012

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:8
  • Furniture, Fixtures and Equipment:N/A
About The Facility:

The business actually has two facilities - one is a 9,000 sq. ft. office/showroom/warehouse owned by the seller's real estate development company, and the other is a 25,000 sq. ft. leased warehouse where the distribution side of business operates from.

Is Support & Training Included:

Seller will provide training and transition services as needed ti help ensure a smooth ownership change.

Purpose For Selling:

Family commitments and other business interests

Pros and Cons:

Given the diverse nature of this business - being equally involved in both the distribution and installation aspects of the industry - the business has a unique position in the market. It is able to pivot as needed to take advantage of conditions that may make one or the other, or both, segments the more lucrative paths to follow at any given time.

Opportunities and Growth:

The business has no outside sale staff, or even an outside sales effort. It's just not something the owner enjoys doing or managing. So there is a tremendous opportunity for a new owner that understands business development to come in and immediately grow through that avenue.

Additional Info

The company was founded in 2012, making the business 10 years old.
The transaction shall include inventory valued at $500,000, which is included in the asking price.

Why is the Current Owner Selling The Business?

There are all types of reasons why individuals resolve to sell companies. Nevertheless, the true factor vs the one they tell you might be 2 absolutely different things. For instance, they may claim "I have way too many other responsibilities" or "I am retiring". For numerous sellers, these reasons stand. But also, for some, these might just be justifications to attempt to hide the reality of transforming demographics, increased competitors, recent decrease in revenues, or an array of other reasons. This is why it is very important that you not rely completely on a seller's word, yet rather, use the vendor's solution in conjunction with your general due diligence. This will repaint a much more realistic picture of the business's current scenario.

Existing Debts and Future Obligations

If the current entity is in debt, which lots of businesses are, then you will have reason to consider this when valuating/preparing your deal. Numerous companies borrow money so as to cover things like supplies, payroll, accounts payable, and so on. Keep in mind that sometimes this can mean that revenue margins are too thin. Many businesses fall into a revolving door of taking loans as a way to pay back other loans. In addition to debts, there may also be future obligations to think about. There may be an outstanding lease on equipment or the structure where the business resides. The business may have existing agreements with suppliers that should be met or may lead to fines if canceled early.

Understanding the Customer Base, Competition and Area Demographics

Just how do companies in the area draw in new consumers? Most times, businesses have repeat customers, which form the core of their day-to-day profits. Specific elements such as new competition growing up around the area, roadway building, and staff turnover can influence repeat customers and also negatively influence future revenues. One vital point to take into consideration is the placement of the business. Is it in a very trafficked shopping center, or is it hidden from the main road? Certainly, the more individuals that see the business on a regular basis, the higher the possibility to construct a returning client base. A last idea is the general area demographics. Is the business situated in a densely inhabited city, or is it located on the edge of town? How might the neighborhood average family earnings effect future revenue prospects?