Listing ID: 77215
This established food manufacturing operation is a multifaced one. The business’s several divisions include contract food manufacturing, specialty food and beverage co-packing, amnd much more. The facility’s comprehensive build-out (approx. $1 ml.) provides it remarkable versatility and efficiency. Perhaps most importantly, the company has a loyal team of seasoned management and dedicated staff that diligently oversee each aspect of the complex operation and its related logistics. Rigorous systems and documented procedure manuals were developed years ago and are adhered to in order to ensure operational efficacy.
Please note that the $4.5 million property will not be sold without the business, though the $1.0 million business may potentially be sold without the property and the owner remaining the landlord. As potential lease rates will be a function of a variety of factors, they are not being stated at the outset.
- Asking Price: $5,500,000
- Cash Flow: $360,000
- Gross Revenue: $4,200,000
- EBITDA: $360,000
- FF&E: N/A
- Inventory: N/A
- Inventory Included: N/A
- Established: N/A
- Property Owned or Leased:Own
- Property Included:N/A
- Building Square Footage:8,700
- Lot Size:N/A
- Total Number of Employees:25
- Furniture, Fixtures and Equipment:N/A
The roughly 10,000 square foot manufacturing plant has no shortage of food production and preparation space, a showroom, packaging area, operations and logistics center, meeting rooms and management offices. The kitchen boasts nearly 50 feet of hood space, set-up to be reconfigured as required with interchangeable equipment as well as 3 coolers.
Seller will train for 4 weeks at 20 hours per week or as negotiated.
Competition exists on several different levels for each line of business. Large and small catering companies with varying degrees of food delivery services or equipment rental components abound throughout Southern California. Similarly, an array of pre-permitted or permit ready commissary and commercial kitchens exist, as do food labs, incubators and product development specialists. Finally, while co-packers with varying specialties and abilities are omnipresent, its remarkably uncommon to find all of these under one roof with significant excess capacity and every growing demand!
Customer demand trends have somewhat dictated the firm’s development. This has culminated in the enterprise becoming somewhat of a co-packer cum food-incubator with a significant ‘mind share’ presence within Southern California’s community of food and beverage innovators and trendsetters. New operators may take this operation in any number of directions. They may focus on any one or more successful components of the current business or they may concentrate on the company’s latest customer-embraced iteration as a burgeoning food and beverage service accelerator. In this capacity, the firm assists new companies in every step of recipe development, testing and certification, labeling, packaging and in some cases, direct delivery / third party distribution. As the kitchen operates at under an estimated 25% capacity the opportunity may also be ideal for an existing manufacturer that wishes to take their third-party manufacturing in-house, or to relocate an existing facility or expand via a new one.
The company has 25 employees and is located in a building with disclosed square footage of 8,700 sq ft.
Why is the Current Owner Selling The Business?
There are all types of reasons why people decide to sell businesses. Nevertheless, the true reason and the one they tell you might be 2 totally different things. For instance, they might state "I have way too many various responsibilities" or "I am retiring". For lots of sellers, these reasons stand. But, for some, these may just be justifications to try to conceal the reality of transforming demographics, increased competitors, recent reduction in earnings, or a range of other factors. This is why it is extremely essential that you not count completely on a seller's word, yet rather, use the vendor's solution along with your overall due diligence. This will repaint a more practical picture of the business's current circumstance.
Existing Debts and Future Obligations
If the current company is in debt, which many companies are, then you will certainly have reason to consider this when valuating/preparing your deal. Many operating businesses borrow money in order to cover points such as inventory, payroll, accounts payable, so on and so forth. Remember that occasionally this can suggest that earnings margins are too thin. Numerous businesses fall under a revolving door of taking on debt as a way to pay back various other loans. In addition to debts, there may additionally be future obligations to think about. There may be an outstanding lease on tools or the structure where the business resides. The business might have existing contracts with vendors that need to be met or might lead to fines if canceled early.
Understanding the Customer Base, Competition and Area Demographics
How do operating businesses in the area attract brand-new consumers? Many times, businesses have repeat customers, which develop the core of their daily earnings. Specific variables such as new competitors growing up around the area, road building and construction, and also employee turnover can influence repeat customers and negatively influence future revenues. One important thing to think about is the location of the business. Is it in an extremely trafficked shopping center, or is it concealed from the main road? Clearly, the more people that see the business regularly, the greater the possibility to construct a returning customer base. A final idea is the general area demographics. Is the business located in a densely inhabited city, or is it located on the outside border of town? Just how might the regional mean home income impact future income prospects?