Business Overview

Opportunity to purchase a manufacturer and distributor of a well established CBD brand with over 100 retail locations throughout the U.S. Seller’s manufacturing facility is located in Arizona and its executive offices are located in Southern California. This profitable CBD company markets a full line of CBD oils, topicals and gummies, including Delta 8, and a full line of pet products, particularly popular with dog and cat owners. The company has experienced revenue growth each year since its founding in 2018, through shelf space at retail locations, its online store and brand awareness. All products are lab tested and in full compliance with state and national regulations. There is a wholesale program and a robust digital strategy aimed at increasing sales.

Financial

  • Asking Price: $1,690,000
  • Cash Flow: N/A
  • Gross Revenue: $1,560,000
  • EBITDA: N/A
  • FF&E: N/A
  • Inventory: $100,000
  • Inventory Included: N/A
  • Established: 2018

Detailed Information

  • Property Owned or Leased:N/A
  • Property Included:N/A
  • Building Square Footage:6,013
  • Lot Size:N/A
  • Total Number of Employees:12
  • Furniture, Fixtures and Equipment:N/A
About The Facility:

Seller's executive headquarters, sales and shipping are located in Southern California and occupy 1463 sq. ft. for approximately $2800 a month NNN through 5/31/23. Seller's Arizona manufacturing facility occupies 4550 sq. ft.for approximately $3300 a month NNN through 7/31/23. The facility has 800 AMPS 208 phase three power and has all the processing equipment needed for Seller's manufacturing operations. Combined monthly rent for Seller's two leased facilities is $6050.

Is Support & Training Included:

Seller can assist with a transition of the business to Buyer.

Purpose For Selling:

Seller focusing on other assets.

Pros and Cons:

There is significant upside potential for a buyer to grow revenues with increased internet marketing and additional third party retail store presence. The market for CBD products is expected to continue rapid growth to over $20 billion in the US by 2024, including uses in cosmetics, health products, food and beverage, pet products, skin care and pharmaceuticals. It also is expected that CBD products will be more broadly sold at pharmacies, fitness chains, yoga chains, mass retailers, cosmetic retailers and convenience stores in the future.

Opportunities and Growth:

Seller has a diversified customer base consisting of both wholesale buyers and Direct to Consumer (DTC) sales. Targeted marketing and sales efforts aimed at both segments have been successful and are expected to continue to generate revenue growth. In addition, word of mouth is estimated to account for 1 out of every 2 new customers.

Additional Info

The business was established in 2018, making the business 4 years old.
The deal doesn't include inventory valued at $100,000*, which ins't included in the suggested price.

The company has 12 employees and resides in a building with estimated square footage of 6,013 sq ft.
The property is leased by the business for $6,200 per Month

Why is the Current Owner Selling The Business?

There are all sorts of reasons why individuals decide to sell companies. However, the genuine reason and the one they say to you might be 2 totally different things. As an example, they may say "I have too many other responsibilities" or "I am retiring". For numerous sellers, these reasons stand. However, for some, these might simply be reasons to try to hide the reality of changing demographics, increased competition, current reduction in incomes, or a range of other factors. This is why it is really essential that you not depend completely on a seller's word, but rather, make use of the vendor's solution combined with your total due diligence. This will paint a much more reasonable image of the business's present scenario.

Existing Debts and Future Obligations

If the current company is in debt, which numerous companies are, then you will certainly have reason to consider this when valuating/preparing your offer. Lots of operating businesses borrow money with the purpose of covering points such as supplies, payroll, accounts payable, so on and so forth. Bear in mind that sometimes this can imply that revenue margins are too tight. Numerous organisations come under a revolving door of taking loans as a way to pay back other loans. In addition to debts, there may additionally be future commitments to think about. There might be an outstanding lease on tools or the building where the business resides. The business may have existing contracts with vendors that need to be fulfilled or might lead to fines if terminated early.

Understanding the Customer Base, Competition and Area Demographics

Exactly how do companies in the location attract new consumers? Many times, businesses have repeat customers, which create the core of their daily revenues. Specific variables such as new competitors growing up around the location, road building and construction, as well as staff turn over can influence repeat clients as well as negatively impact future profits. One crucial point to think about is the area of the business. Is it in an extremely trafficked shopping center, or is it hidden from the highway? Clearly, the more people that see the business often, the greater the possibility to build a returning client base. A final idea is the basic area demographics. Is the business placed in a densely inhabited city, or is it located on the outskirts of town? How might the neighborhood mean house income effect future revenue prospects?