Business Overview

A multidisciplinary Medicare-certified home health agency in business since 2006, serving northern California’s Bay Area/Silicon Valley/San Jose metro area. The company provides in-home skilled nursing and health aide, home infusion services, wound care, rehabilitation, and social services. In addition to its Medicare license, the company has 10 highly coveted, under-served insurance contracts, which includes Kaiser, Stanford, Santa Clara Family Health Plan, and Sutter Health, among others. With a census of 70 patients, they are consistently receiving incoming referrals from insurances, hospitals, SNFs, and doctors.

The company had a gross revenue of $1.8 million in 2019 (July-June fiscal year) and is expected to reach $2 million in revenue in 2020 despite the implications of the COVID-19 shutdown. They are projecting a $350,000 adjusted EBITDA for 2020, demonstrating growth from 2019.

The staff is expected to stay on, and the seller will accommodate a transitional period as needed. If preferred by the purchasers, the current owner is willing to stay on for at least a year in a management/advisory position.

The asking price for this business is $1,000,000. The purchaser may acquire the business operation out of the owning corporation or may purchase the entity itself, subject to discussion and negotiation.

For qualified prospective buyers, a detailed Confidential Business Review with current financials is available.

Note: All data on this business are provided by the Seller for information purposes only, and no representations are made by the Broker as to accuracy. The Broker has made NO independent verification of the data contained herein. The Broker represents the Seller and does NOT represent the Buyer. The Buyer is advised to perform independent due diligence and seek the advice of professionals prior to purchasing the Business.

Financial

  • Asking Price: $1,000,000
  • Cash Flow: $350,000
  • Gross Revenue: $2,000,000
  • EBITDA: N/A
  • FF&E: N/A
  • Inventory: N/A
  • Inventory Included: N/A
  • Established: N/A

Why is the Current Owner Selling The Business?

There are all types of reasons why individuals decide to sell businesses. Nonetheless, the genuine reason and the one they tell you may be 2 absolutely different things. As an example, they may say "I have a lot of various responsibilities" or "I am retiring". For many sellers, these reasons stand. But also, for some, these might just be excuses to attempt to hide the reality of transforming demographics, increased competition, current reduction in revenues, or an array of various other factors. This is why it is very important that you not count totally on a seller's word, however instead, use the vendor's solution combined with your total due diligence. This will repaint a much more realistic image of the business's present situation.

Existing Debts and Future Obligations

If the existing business is in debt, which numerous companies are, then you will have reason to consider this when valuating/preparing your deal. Many operating businesses finance loans so as to cover points like stock, payroll, accounts payable, so on and so forth. Keep in mind that occasionally this can suggest that earnings margins are too small. Numerous companies fall under a revolving door of taking on debt as a way to pay back other loans. Along with debts, there may additionally be future commitments to think about. There might be an outstanding lease on equipment or the building where the business resides. The business may have existing agreements with suppliers that have to be satisfied or may lead to penalties if terminated early.

Understanding the Customer Base, Competition and Area Demographics

How do operating businesses in the area draw in new customers? Most times, operating businesses have repeat clients, which develop the core of their everyday earnings. Certain variables such as new competitors sprouting up around the location, road construction, as well as personnel turnover can impact repeat consumers and adversely affect future revenues. One vital thing to think about is the location of the business. Is it in a highly trafficked shopping mall, or is it concealed from the highway? Undoubtedly, the more people that see the business often, the better the chance to develop a returning consumer base. A last thought is the general area demographics. Is the business situated in a largely inhabited city, or is it located on the outside border of town? How might the neighborhood average family earnings impact future earnings prospects?