Business Overview

Established in 1983 with roots dating back to the turn of the century, this business is a trusted and essential partner in the four rural markets it serves. The company saw record growth in 2021 due to a hot construction market and DIY home improvement demand from consumers. It is the number one choice for both lumber and hardware needs in each of its four locations.

The business has experienced consistent financial performance, and has an excellent reputation with customers and its long-standing supplier relationships. Since purchasing the original store in 1983, management has strategically expanded to serve outlying areas throughout southwest Missouri. The company outperforms big-box retailers on local knowledge, customer service and speed of delivery.

The company’s revenue is almost evenly split between walk-in customers and building contractors. In addition to hardware, each store offers a complete array of plumbing and electrical supplies, as well as cabinets, paint and paint supplies, and a variety of other home improvement necessities.

This company offers an opportunity to acquire a turnkey business – fresh off its best year ever – that could continue to be operated beautifully as-is. Alternatively, a strategically focused buyer could use the company’s reputation, longevity and success as a foundation for next-level growth and expansion.

Financial

  • Asking Price: $3,000,000
  • Cash Flow: $920,000
  • Gross Revenue: $14,065,000
  • EBITDA: $920,000
  • FF&E: $400,000
  • Inventory: $2,326,000
  • Inventory Included: N/A
  • Established: 1983

Detailed Information

  • Property Owned or Leased:Own
  • Property Included:N/A
  • Building Square Footage:N/A
  • Lot Size:N/A
  • Total Number of Employees:28
  • Furniture, Fixtures and Equipment:N/A
About The Facility:

This business operates out of four separate locations, all ideally situated on main traffic thoroughfares, with easy access to the Interstate and surrounding areas. Each location has a retail storefront for walk-in customers, as well as storage and display areas for lumber, plywood, and other bulk wood products. [The real estate is owned by a related third party and is available for sale separately through Red Tree Realty Group.]

Is Support & Training Included:

Negotiable. Seller is willing to enter into a limited consulting agreement with a new owner. Senior manager may be willing to stay on under new ownership.

Purpose For Selling:

Retirement

Pros and Cons:

This business is the first choice for hardware purchases in all four of its popular home centers. The company’s longevity and brand -- coupled with its loyal customers and growing rural locations -- provide a steady stream of new and repeat business from home owners, farmers and building contractors. The company distinguishes itself from the competition through superior customer service and speed of delivery compared to regional big-box stores.

Opportunities and Growth:

Many opportunities exist for a new, strategically focused owner to grow this business to the next level. These include but are not limited to the following: Updating the company’s website to include an ecommerce sales channel, hiring a dedicated sales and marketing team, offering new products and rental services to existing customers, and expanding into at least one contiguous territory. This business is also well-positioned to continue enjoying organic growth in conjunction with a demographic trend fueled by remote workers relocating away from high-density metro areas.

Additional Info

The venture was established in 1983, making the business 39 years old.
The transaction won't include inventory valued at $2,326,000*, which ins't included in the requested price.

The company has 28 employees and is situated in a building with estimated square footage of N/A sq ft.

Why is the Current Owner Selling The Business?

There are all types of reasons why people decide to sell operating businesses. Nonetheless, the genuine reason vs the one they say to you might be 2 absolutely different things. For instance, they might say "I have way too many other responsibilities" or "I am retiring". For lots of sellers, these reasons stand. But, for some, these may simply be justifications to attempt to hide the reality of transforming demographics, increased competition, current decrease in incomes, or an array of various other reasons. This is why it is extremely important that you not count absolutely on a seller's word, yet rather, make use of the vendor's response in conjunction with your overall due diligence. This will repaint a more practical picture of the business's existing scenario.

Existing Debts and Future Obligations

If the existing entity is in debt, which many businesses are, then you will have reason to consider this when valuating/preparing your deal. Lots of businesses finance loans in order to cover items like supplies, payroll, accounts payable, etc. Bear in mind that occasionally this can suggest that earnings margins are too thin. Numerous organisations fall into a revolving door of taking on debt as a way to pay back other loans. In addition to debts, there may additionally be future obligations to consider. There might be an outstanding lease on tools or the structure where the business resides. The business may have existing agreements with suppliers that must be met or might result in charges if canceled early.

Understanding the Customer Base, Competition and Area Demographics

Exactly how do businesses in the area bring in brand-new customers? Most times, operating businesses have repeat customers, which form the core of their day-to-day revenues. Certain variables such as brand-new competitors growing up around the location, roadway construction, as well as employee turn over can influence repeat customers and adversely influence future profits. One vital point to think about is the area of the business. Is it in a very trafficked shopping mall, or is it concealed from the main road? Obviously, the more individuals that see the business regularly, the better the opportunity to build a returning consumer base. A final idea is the basic location demographics. Is the business located in a largely populated city, or is it located on the edge of town? Just how might the regional mean home earnings effect future revenue prospects?