Listing ID: 80160
This wholesale supply distributor specializes and serves the wholesale market for the sale of automotive wheel parts to mom & pop wheel shops and automotive repair businesses. They are a one-stop-shop for most everything needed for companies to mount, dismount, or upgrade accessories for their wheels. The business also sells a substantial line of other wheel related products.
In operation since 1990, the business is located in a large metropolitan statistical area in the Southeast and ships products across the United States. The company serves approximately 100 customers daily (walk-in, shipping, and delivery – 5 days per week).
• NO CONSUMER TRADE; CUSTOMERS ARE WHOLESALE CLIENTS.
- Asking Price: N/A
- Cash Flow: $297,566
- Gross Revenue: $1,378,750
- EBITDA: N/A
- FF&E: $150,000
- Inventory: $300,000
- Inventory Included: N/A
- Established: 1990
- Property Owned or Leased:Own
- Property Included:N/A
- Building Square Footage:3,750
- Lot Size:N/A
- Total Number of Employees:4
- Furniture, Fixtures and Equipment:N/A
The owned business facility has 3,750 square foot of space containing 500 square feet of office space, a counter sales area, kitchen/breakroom and bath as well as a roll-up door with loading dock for both delivery and pickup. The facility may be purchased at fair market value or leased to the new owner at fair market rent.
Owner will stay for a transition. Owner is willing to stay after the sale and carry on operations as he currently does with a lighter load of responsibilities.
Excellent opportunity to increase sales in several areas: 1. Producing a product catalog and adding a fulltime outside salesperson would significantly grow revenue. 2. Adding an additional delivery truck/delivery personnel will also boost sales. 3. The business has no established marketing plan in place. 4. The business does have a web presence but sales could be boosted by adding online ordering.
The business was founded in 1990, making the business 32 years old.
The deal won't include inventory valued at $300,000*, which ins't included in the suggested price.
The company has 4 employees and resides in a building with estimated square footage of 3,750 sq ft.
Why is the Current Owner Selling The Business?
There are all kinds of reasons why people resolve to sell operating businesses. However, the true reason vs the one they say to you might be 2 entirely different things. For instance, they may state "I have a lot of other commitments" or "I am retiring". For lots of sellers, these reasons stand. But, for some, these may just be justifications to try to hide the reality of transforming demographics, increased competitors, current decrease in incomes, or a range of other reasons. This is why it is really important that you not depend totally on a vendor's word, yet rather, utilize the vendor's response combined with your total due diligence. This will repaint a more reasonable picture of the business's current scenario.
Existing Debts and Future Obligations
If the existing entity is in debt, which many companies are, then you will have reason to consider this when valuating/preparing your offer. Numerous companies finance loans with the purpose of covering things such as inventory, payroll, accounts payable, etc. Bear in mind that sometimes this can suggest that earnings margins are too tight. Numerous companies come under a revolving door of taking loans as a way to pay back other loans. In addition to debts, there may also be future commitments to take into consideration. There may be an outstanding lease on equipment or the building where the business resides. The business might have existing contracts with vendors that need to be satisfied or may cause charges if terminated early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do businesses in the location bring in brand-new customers? Most times, operating businesses have repeat customers, which develop the core of their day-to-day revenues. Particular aspects such as new competitors sprouting up around the area, road building, as well as employee turn over can affect repeat clients and also adversely influence future incomes. One essential point to think about is the area of the business. Is it in a very trafficked shopping mall, or is it hidden from the highway? Undoubtedly, the more people that see the business regularly, the greater the opportunity to build a returning customer base. A last thought is the basic location demographics. Is the business situated in a largely inhabited city, or is it situated on the outskirts of town? Just how might the local typical house earnings impact future income prospects?