No photo available
We are pleased to offer an attractive, nicely profitable B to B fastener distribution business in a wonderful Northern Michigan location. This 20 year old business is located in a late model 6,000 square foot business on a one acre parcel, both of which are included in the sale. The business is adjacent to a busy commercial thoroughfare offering both high visibility and easy access.
The business has five loyal non-union employees and three commission salesmen (with an average tenure of over 10 years). The business is customer focused, reliable and dedicated to providing quality products and services to the industrial, retail, construction and consumer markets.
Customers range from small builders to large, industrial manufacturers. There is no customer concentration. The company stocks over 3,000 sku’s of high quality fasteners and tools including screws, nuts, bolts, washers, rivets, automotive clips, electrical and cable ties, to name several. Additional offerings include auto-body products and tools/safety products. Orders are packed and shipped generally the day they are received. The company has an attractive website that offers both online ordering and timely responses to customer inquiries.
Additional profit centers include light assembly and custom packaging, both to customer specifications. There is even a small retail space which offers the company’s full line of products to local do-it-yourself customers.
Over the past four years, the business has had average annual sales of $800,000 with a projected $855,000 of 2021 revenues. SDE (seller’s discretionary earnings - the historical, normalized cash flow for an owner-operator to pay himself and service debt) has averaged $170,000 annually with 2021 SDE tracking over $200,000.
The business and real estate combined are being offered for $1.2 million which is comprised of the sum of:
• Enterprise Value = 2.75x SDE of $170,000 = $467,500
• On-hand salable inventory = $88,000
• Real Estate (valued by local commercial realtor) = $660,000
A typical SBA deal with 12.5% buyer cash ($150,000), a matching amount for a seller note (to a qualified buyer) and a $900,000 SBA term loan would result in a four year average annual free cash flow (after both bank and seller note debt service and after paying the buyer a $100,000 annual salary) of more than $30,000, with 2021 tracking at an impressive $90,000 rate.
The founder/owner/seller plans to retire after an orderly transition period for the buyer. For more information on this established, attractive, cash flowing distribution business with real estate, please contact broker.
Disclaimer: DealStream has not independently verified any of the information in this listing and makes no warranty as to its accuracy or completeness. This listing does not constitute an offer to sell, solicit or make an offer to buy an investment interest. Offers to sell, or the solicitation of offers to buy, any security can only be made through official offering documents, such as a subscription agreement and private placement memorandum.