Listing ID: 82163
This pallet company has been building, recycling and selling wood pallets for over 30 years. Located in Iowa they service clients throughout the Midwest with many large national companies as strong repeat clients. Fully staffed and equipped this turn key business has strong sales and profits. The current owner is planning to retire and is open to training a new owner for future success.
- Asking Price: $1,425,000
- Cash Flow: $256,000
- Gross Revenue: $1,800,000
- EBITDA: N/A
- FF&E: N/A
- Inventory: N/A
- Inventory Included: N/A
- Established: 1988
- Property Owned or Leased:Own
- Property Included:Yes
- Building Square Footage:30,000
- Lot Size:N/A
- Total Number of Employees:10
- Furniture, Fixtures and Equipment:N/A
Owner will assist in a smooth transition
The company was started in 1988, making the business 34 years old.
The company has 10 employees and is located in a building with disclosed square footage of 30,000 sq ft.
Why is the Current Owner Selling The Business?
There are all sorts of reasons people choose to sell operating businesses. Nonetheless, the genuine reason and the one they say to you might be 2 completely different things. For instance, they may say "I have too many other responsibilities" or "I am retiring". For numerous sellers, these factors stand. But also, for some, these might just be reasons to try to conceal the reality of changing demographics, increased competitors, current reduction in incomes, or an array of various other reasons. This is why it is extremely vital that you not rely absolutely on a seller's word, yet rather, utilize the seller's solution combined with your general due diligence. This will paint a more realistic picture of the business's existing scenario.
Existing Debts and Future Obligations
If the existing entity is in debt, which numerous businesses are, then you will have reason to consider this when valuating/preparing your offer. Many businesses finance loans with the purpose of covering things like stock, payroll, accounts payable, so on and so forth. Remember that in some cases this can indicate that earnings margins are too tight. Many organisations 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 obligations 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 met or may lead to charges if canceled early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do businesses in the area attract new clients? Often times, companies have repeat clients, which create the core of their day-to-day earnings. Specific aspects such as new competitors sprouting up around the area, roadway building, and also personnel turnover can influence repeat clients as well as adversely affect future revenues. One important point to take into consideration is the location of the business. Is it in an extremely trafficked shopping mall, or is it hidden from the highway? Obviously, the more people that see the business on a regular basis, the better the chance to build a returning customer base. A last idea is the general area demographics. Is the business placed in a largely populated city, or is it located on the edge of town? Exactly how might the neighborhood typical home income influence future income prospects?