Business Overview

This business manufactures custom home décor products and sells interior design products at wholesale and retail. Annual sales will exceed $1,000,000 in 2021.

Price: $399,000, plus approx. $200k+ of inventory at cost. Annual sales: $1,000,000+. SDE: $125,000+. Up to 50% seller financing may be available for a qualified buyer.

With a workroom and a retail store, this business manufactures and sells at wholesale and retail custom home décor products These products (and services) include valances, Roman shades, draperies, other window treatments, upholstered headboards and furniture, reupholstering, and fabrics, both standard and custom.

Founded in 1995, the current owner has had the company since 2005.

Annual sales are approximately $1,000,000; however, at mid-year 2021, sales were already over $700,000. That portends annual gross revenues at or above $1.2 million. The owner reports an estimated SDE for 2020 of about $125,000; SDE for 2021 is expected to be significantly higher. Financial figures for 2021 are being compiled.
The average order backlog is $200,000+/- (orders not started), typically with deposits for half.

There are 14 full-time and 2 part-time employees. Most of the staff have been with the company for many years, with some from the founding of the business 26 years ago. The owner-operator handles over-all company management in general, and, in particular, reviewing estimates and invoices, handling payables and payroll, and marketing.

The business operates from an 8,000 sq. ft. (+/-) leased building, where they have been for 17 years. The current monthly rent is $4,614. They are in the second year of the current 5-year lease. The 8,000 square feet include a 1200 sq. ft. showroom, and manufacturing and inventory space with 4 roll up doors.

The company has 245 wholesale customer accounts and over 6,000 retail customer accounts. Most customers return for multiple purchases with 90% of sales being repeat orders from satisfied customers. There are myriad ways of growing the business. Currently they are open four days per week. A new owner could increase the direct-to-consumer trade by keeping the retail showroom open on Friday, Saturday, and Sunday. Product lines can be added. Additional workers could work in alternating shifts to utilize existing machinery most effectively.

The tangible physical assets include a van, box truck, scissor lift, racks, store fixtures, desks, computers, plus all the manufacturing equipment and tools. The seller estimates the cost to replace everything to be at least in the low two-hundred-thousands.

The owner is open to a training, transition, and consultation period, depending on the needs and wishes of the new owner and the terms of the transaction.

Price & Transaction. The price is $399,000 (subject to negotiation and terms). The business is offered as a sale of all the tangible/physical assets of the company, plus the intangible property, including the highly-valuable business name, logo, websites, phone numbers, customer data, etc. It does not include accounts receivable, cash on hand, and facility rent deposits; inventory is included in the sale, but the approximately $200,000+ of inventory would be in addition as negotiated by the parties. Work-in-process would be pro-rated. The seller will be responsible for all accounts payable through the date of closing. The current owner would be open to a training & transition phase to facilitate a smooth transfer to new ownership.

Financial

  • Asking Price: $399,000
  • Cash Flow: $125,000
  • Gross Revenue: $1,000,000
  • EBITDA: $125,000
  • FF&E: N/A
  • Inventory: $200,000
  • Inventory Included: N/A
  • Established: 1995

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:16
  • Furniture, Fixtures and Equipment:N/A
Purpose For Selling:

Retirement

Additional Info

The venture was founded in 1995, making the business 27 years old.
The sale shall not include inventory valued at $200,000*, which ins't included in the suggested price.

Why is the Current Owner Selling The Business?

There are all kinds of reasons individuals decide to sell companies. However, the real factor vs the one they tell you might be 2 absolutely different things. For instance, they may state "I have way too many various obligations" or "I am retiring". For many sellers, these reasons stand. But, for some, these may simply be reasons to try to conceal the reality of altering demographics, increased competition, current reduction in earnings, or an array of various other factors. This is why it is extremely important that you not rely totally on a vendor's word, however instead, use the vendor's answer along with your overall due diligence. This will paint a more realistic image of the business's existing circumstance.

Existing Debts and Future Obligations

If the existing company is in debt, which numerous businesses are, then you will have reason to consider this when valuating/preparing your offer. Numerous companies borrow money so as to cover items like supplies, payroll, accounts payable, so on and so forth. Bear in mind that in some cases this can mean that earnings margins are too thin. Numerous organisations fall into a revolving door of taking loans as a way to pay back other loans. Along with debts, there may likewise be future obligations to take into consideration. There may be an outstanding lease on tools or the structure where the business resides. The business might have existing agreements with suppliers that need to be satisfied or might lead to fines if terminated early.

Understanding the Customer Base, Competition and Area Demographics

Just how do companies in the area attract new clients? Many times, operating businesses have repeat customers, which create the core of their everyday revenues. Certain variables such as new competitors growing up around the location, roadway construction, and also staff turn over can affect repeat customers as well as negatively affect future profits. One vital point to take into consideration is the location of the business. Is it in an extremely trafficked shopping mall, or is it concealed from the main road? Certainly, the more individuals that see the business often, the higher the chance to construct a returning client base. A final thought is the general area demographics. Is the business located in a largely inhabited city, or is it located on the outside border of town? How might the regional average home income impact future earnings prospects?