Business Summary:
Ref No: GM016Location: MidlandsLeaseholdAsking price: £1.2 Million (Inc. Net Assets circa £1Million)Asking price includes: Turnover for last financial year circa £3.6 million p.a.Resultant gross profits circa £1.05m p.a.Adjusted EBITDA (pre-director drawings) circa £265,000 p.a.Net Assets circa £1 Million (Inc. stock, debtors etc.)30 years successful tradingSuperb supplier relationshipsHuge customer baseCirca 2500 account clientsKey staff in placeTraining and handoverTwo E-Bay shopsWebsiteBusiness Profile:This well established and very reputable business was set up almost 30 years ago by the current vendor and in that time has grown into a highly professional and respected supplier of Industrial,Workshop and Garage Equipment products. The company provides a broad range of high quality branded products,consumables and components to customers within a variety of markets including the industrial, agricultural, motor, commercial, manufacturing and production sectors.Approximately 75% of revenues are from on-line sales through two highly successful E-Bay shops as well as the business’ own website with the remaining 25% being made up of repairs, calibration, certification and installation services. These additional services provide customers with unrivalled customer service and support and ensure ongoing revenues for the business, not to mention helping to forge sterling customer relationships.The company can boast a very large and loyal customer base (circa 2,500 active account customers) who rely on this business to provide them with the correct products that are readily avaiable, fit for purpose, and come with the appropriate after-sales service and technical support. Sales come via the telephone, E-bay, website, trade counter, email and through two external sales representatives with items being delivered or on collection.Over the last few years the business has expanded into e-commerce and online sale of certain smaller product lines and has enjoyed significant success in this arena so much so that in excess of 75% of current sales revenues are now generated via the internet. Because of its service level approach to business the company enjoys impressive levels of referrals and repeat business.The current customer list is very impressive and includes large blue chip clients who have significant presence in the region as well as small/medium organisations on a local, regional and national scale. The spread is good and as such the business has no over reliance on any one customer, sector or region. The majority of sales are within the UK with a very small percentage (circa 1-2%) shipping overseas. The business has set up an enviable supply chain over the years and sources parts direct from reknowned manufacturers/suppliers that are leaders in their fields. These supply partners provide a choice of in-demand, reliable goods that are synonymous with quality and the brands speak for themselves.The company has a strong asset base, generates impressive profits, has a sterling reputation and holds a large level of high quality stock which ensures it can deliver mission critical items to its clients time and time again.. The vendor has put in place a talented team of staff with key employees in place for each part of this multi-faceted business which ensures it runs smoothly on a day to day basis without the need for his day to day involvement.Equipment:The company has invested in technology and back office systems to manage the operation and this includes sage accounting, stock control systems, online price comparison tools etc. It also has a showroom and fully equipped workshop to carry out repairs and calibration and can also provide on-site installations utilising its own plant and equipment. Customer Service:The business considers simply that satisfied customers come back and on this basis has maintained levels of product and service quality intended to best guarantee this satisfaction.This is done by not only providing market leading brands from world renowned manufacturers at competitive prices but also by having stock available to dispatch to customers as and when required. The company has the market knowledge and expertise to source less common items if so required and those that will be in short supply in the future which enables it to maximise profitability. Because of this it enjoys very high levels of repeat business and customer retention levels.As already mentioned the business provides repairs and installation services which is key for some of the larger high value pieces of plant and equipment the company supplies. It also possesses the in-house technical knowledge to provide advice and recommendations.Key Strengths: The business has enjoyed impressive growth and profitability over a 30 year period and now enjoys consistent levels of custom from a wide range of customers. It provides a mission-critical service to both large and small production plants and facilities and has strong relationships in place within these organisations spanning many years. It has many areas of strength including:• Superb reputation built on knowledge, reliability and attention to detail.• Good stock levels• Excellent supply chain-top quality products with warranties• Large regular blue customer base with “approved supplier” status• High service levels and speed of response• Profitability and positive cash flow• Superb team of multi-skilled employeesGrowth and Expansion: The company has access to further product ranges and could easily expand its product offering to incorporate even more complementary items. Moving forward the business could easily look at setting up other depots replicating this highly successful model as the key supply chains are already in place. StockThe business is being sold with stock levels at c£1.6m. . Key Opportunities:As already mentioned the market for this business’ products and services is significant so it could be easily scaled up.It would be an attractive acquisition to companies who provide complementary goods and services that could also be sold into this business’ very large customer base.Employees:The vendor is MD of the company and tends to operate on a strategic level overseeing the operation. He wishes to remain as sales consultant post-sale on a commission basis. The business employs some 13 full time employees (external sales representatives, engineers, sales assistants, accounts, credit control and delivery) and has the following key staff in place to manage each part of the business:• Engineering Manager• Online Sales Manager• Showroom/Trade Sales Manager • Book-keeperAdvertising and Marketing: The business enjoys high levels of repeat business, word of mouth recommendations and referrals from a vast and loyal customer base. This is further supported with an extensive range of brochures and flyers both in-house and via their leading manufacturing partners which are distributed via their external sales representatives and via e-shots. The company also has an informative website with e-commerce facility, not to mention two of its own E-Bay shops which are enjoying rapid sales growth. The company is considering social media to promote its wares.Premises:The business operates from ideal premises on a well-known industrial estate. Total floor space is currently circa 14,500 square feet and comprises showroom, workshop, offices and warehousing/storage. The company currently owns one of the premises from which it trades. It is intended that this will transferred out of the company prior to a sale and leased back at an annual rent of £30,800. This rent has already been factored into the calculation of the adjusted EBITDA. The other two units occupied by the company are owned by the vendor’s SIPP. The vendor would consider selling the premises should a new owner require, subject to negotiation. Business Hours:Monday - Friday: 08:30-17:00Saturday - 08:30-12:00Financial Information: The business is being offered for sale on a going concern basis, all financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler. Turnover for last financial year circa £3.616 million p.a.Resultant gross profits £1.05 million p.a.Adjusted EBITDA (pre-director drawings) circa £265k p.a.Net Assets circa £1 MillionAsking Price: The asking Price of £1.2m is for 100% of the Issued Share Capital in the Limited company based on Net Assets being £1 Million at time of sale. Should the net asset figure be different from this, the final price will be adjusted up/down accordingly on a £ for £ basis. Reason for Sale:Planning exit with future retirement in mind. The vendor however wishes to remain as a commission-only sales consultant post-sale for a period to be agreed.
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