Listing ID: 81411
This company is a wholesale/retail plumbing supply company servicing the contractors and retail public of several rural Northern California counties. The business was founded in 2015, and has enjoyed significant growth since. The company enjoys a unique position in that it’s located an hour away from the nearest big box home store. They offer plumbing, irrigation, utility and HVAC supplies. While the bulk of the business is to contractors, there is a significant opportunity to expand the retail trade.
Seller owns the property, and would prefer to lease to a new owner, but would consider selling it as well. Opportunities for expansion include: hiring and outside sales person, building a new retail showroom to showcase more plumbing fixtures to the public, and opening several satellite locations in nearby communities. Seller wishes to retire due to health concerns, but will aid a new buyer in learning the business, doing a build to suit new showroom, and any other areas necessary to insure the ongoing success of business.
- Asking Price: $749,000
- Cash Flow: $248,900
- Gross Revenue: $780,534
- EBITDA: N/A
- FF&E: $1,670,000
- Inventory: $350,000
- Inventory Included: Yes
- Established: 2015
- Property Owned or Leased:N/A
- Property Included:N/A
- Building Square Footage:900
- Lot Size:N/A
- Total Number of Employees:1
- Furniture, Fixtures and Equipment:N/A
To be determined
Very little competition with captive market
Retail and organic growth
The company was established in 2015, making the business 7 years old.
The transaction does include inventory valued at $350,000, which is included in the listing price.
The company has 1 employees and is located in a building with disclosed square footage of 900 sq ft.
The property is leased by the business for $2,000 per Month
Why is the Current Owner Selling The Business?
There are all kinds of reasons people resolve to sell companies. However, the true factor vs the one they tell you might be 2 totally different things. For instance, they may claim "I have way too many other commitments" or "I am retiring". For many sellers, these reasons stand. But also, for some, these may simply be justifications to attempt to conceal the reality of altering demographics, increased competitors, recent decrease in earnings, or a variety of various other reasons. This is why it is really vital that you not count entirely on a vendor's word, but rather, make use of the vendor's response combined with your general due diligence. This will paint a much more sensible image of the business's current scenario.
Existing Debts and Future Obligations
If the existing company is in debt, which lots of companies are, then you will have reason to consider this when valuating/preparing your offer. Lots of companies take out loans so as to cover things such as supplies, payroll, accounts payable, etc. Remember that occasionally this can mean that profit margins are too thin. Numerous companies come under a revolving door of taking loans 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 tools or the structure where the business resides. The business might have existing contracts with suppliers that should be met or may cause penalties if canceled early.
Understanding the Customer Base, Competition and Area Demographics
How do companies in the location bring in new customers? Many times, companies have repeat customers, which form the core of their everyday profits. Specific variables such as new competition growing up around the location, roadway construction, and also employee turn over can affect repeat clients and adversely influence future revenues. One important thing to think about is the area of the business. Is it in a very trafficked shopping center, or is it concealed from the highway? Certainly, the more individuals that see the business regularly, the higher the chance to develop a returning customer base. A last idea is the general location demographics. Is the business situated in a densely inhabited city, or is it situated on the outside border of town? How might the regional mean household earnings effect future revenue potential?