Our client is a well established retail flooring company serving affluent homeowners, general contractors and other commercial accounts in the San Francisco Bay Area for over 30 years. The company operates from a highly visible store and a large warehouse. It has a very loyal, repeat customer base and is positioned for same-store growth or expansion to other locations.
The Company has a great reputation, with sterling Yelp reviews, based on its long history of customer satisfaction. The owners are selling to retire. Sales of just over $5,577,154 in 2018 grew 9.7 percent from sales of $5,083,511 in 2017, while the Sellers Discretionary Cash Flow increased to $765,310, compared to $694,756 in the prior year. The company has highly experienced and long tenured salespeople and in-house installers, as well as a store manager and installation supervisor, making it an easy-to-operate business for a new owner. There is just one working owner, and EBITDA for 2018 was $640,310. The business should qualify for an SBA loan with a 15 percent down payment from the Buyer.
Growth could be achieved simply by increasing the currently limited store hours to match those of local competitors, and by soliciting more over-the-counter business from general contractors (25% of sales). Major growth could be achieved by opening a second location.