This company is a leading manufacturer of equipment for fitness clubs. All manufacturing is done in the United States. This brand has enjoyed an impeccable reputation for over 35 years. Their products are known for their high quality and excellent return on investment. Many of their products have been used for over ten years on a commercial basis. The equipment has several competitive advantages. It takes up less space, requires minimal maintenance, and can achieve results for the user in a shorter period of time than any of their competitors’ products. This product can also be private labeled, which is a distinct advantage in the market place. All of these features make their equipment more profitable and desirable in the market place.

The company manufactures its products in New England. It uses sub-contractors to manufacture the components and does assembly and testing in-house. It operates out of one plant where it also ships all of the products. The plant could handle a much higher level of sales. Sale of replacement parts is a large, and profitable, part of the business. The company uses a variety of sales and marketing techniques to get its products into the marketplace. Leasing is popular with customers and also provides more profit for the company.

As of March 31, 2016, the revenues for the trailing twelve months were $1,900,000 and the owner’s cash flow was $600,000. The business, including all of the FFE is offered at $395,000. The inventory, about $350,000 in value, which must be included, and leases receivable are additional. As of June 1, 2016, the total value of these was about $1,350,000. The seller will offer a 10% discount on leases receivable to a cash buyer.

The business leases its space and it is expected that a buyer will be able to negotiate an acceptable new lease with the landlord. All of the FF&E used in the business are included in the sale.

Marketing and sales efforts have not been maximized. Increasing them is likely to achieve more sales and profits. There is also the potential to adapt the equipment for additional uses.

Posted Feb 9, 2016

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