After a successful 30-year run, the owner of this pacific-northwest-based wood products manufacturer is ready to retire and turn his business over to another company or individual with the same commitment to quality and service that clients expect. The business has enjoyed steady repeat business and profitability with very limited marketing and business development activities. It has such a strong brand and reputation that its ratio of orders-to- quotes has grown to greater than 100%. How does this ratio exceed 100%? Prior year orders are fulfilled or business is awarded for which a client doesn’t require a quote. In 2013 its ratio of orders-to-quotes was about 63%. In 2014 it was 81%, in 2015 it was 107%, and for early 2016 it has been 117%. Landing business is important, but do its products meet client specifications? During the company’s entire history there’s been less than .01% product replacement, no bad debts in the past 11 years, and rapid A/R turns.

A large part of this company’s business is “recipe” business, creating the same types of products, over and over for the same clients. The simplicity and recurring nature of this business is attractive. However, most business is generated from word-of-mouth and referral, or through distributors. By proactively marketing to targeted clients a buyer may be able to not only proactively grow sales, but focus on the attractive recipe business that continues to generate revenue year after year.

Posted Jun 8, 2016

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