Contact: Tim Carter
Email: [email protected]
Your Reference ID: TC1101716
It has been a fun and profitable 25 year run, but as the current owner approaches retirement he has decided to proactively seek the successor owner for his business. The seller is willing to stay on for a negotiated transition period.
With six full time employees (including two that have been with the company since day one) and 2-5 temporary employees, the business operates out of an attractive and conveniently located 16,000 sf facility built expressly for this business. Very profitable, value-added light assembly is done on premises and accounts for over 30% of revenues. It would seem that there is significant potential to grow this profit center as the Seller has been turning away new assembly business. The company has a fully integrated computer system to keep track of the extensive customer base and on-site inventory.
This distributor of switches, connectors, wires, lamps, resistors, fuses, circuit breakers, cables and the like represents 30 respected and coveted manufacturers. Historically, customers have been primarily located in Michigan; however, of late, customers with multi-state and international presence have resulted in sales out of state and abroad. No single manufacturer accounts for more than 25% of revenues. Similarly, there is no customer concentration with the largest customer accounting for less than 15% of revenues. While gross margins on various lines and products range from 20% to 40%, the overall gross margin is in the 30% range.
Over the past 3-1/2 years, annual revenues for the business have averaged $2.4 million. Through August, 2016 sales are tracking at a $2.45 million rate. Over the same 3-1/2 year period, annual seller’s discretionary earnings (SDE) has averaged $240,000.The attractive $645,000 listing price is less than a 2.7x multiple of SDE and only 25% of current sales. The price includes over $100,000 (value in place) of fixed assets. Inventory, at cost, is additional, and averages around $500,000.
A meaningful seller note is available for a qualified buyer. The real estate is owned by the seller and is available for lease or sale (separately) under favorable terms.
Location(s): West Michigan
Asking Price: $645,000
Cash Flow: $240,000