AG146 - Specialist Flooring Supplier

Location: South Wales Asking price: £700,000 + Net Assets Net Assets circa £506,000 (inc. freehold, stock, vehicles, equipment) Business highlights include: Year End 2020 Turnover circa £790,000 Year End 2020 Gross Profit circa £508,000 Average recent 3 year adjusted EBITDA circa £204,000 New lease available Established and well-known with many loyal customers High profile modern premises Over 30 years successful trading Management in place Handover and training Strong relations with key suppliers Ideal “bolt on” opportunity Ready for investment and development Goodwill Business Profile: This well known and successful business was founded by the vendor in 1985 and was in response to noticing an opportunity to supply and fit contract floor coverings to the exhibition industry and to add value and generate secondary revenues by re-selling the previously supplied and used carpets back to commercial contract and exhibition customers, looking for savings. The essential character of this business is illustrated in the novel way that its commercial, business to business activities in supplying and fitting exhibition and contract flooring is combined with its retail activities through its freehold premises on a busy and popular trading estate near one of South Wales best known Cities. These retail activities account for circa 26% of overall turnover and is a growing & reliable cash-flow positive contributor to the business’ financial performance. This format has remained unchanged since 1985 and has proven to be both highly profitable and sustainable as a business model; the business continues today as it always has, following this reliable format. The company makes a wide choice of coverings available for hire or sale, including exhibition cord carpet, velour’s, artificial grass and kitchen flooring to exhibition halls, marquees and other venues which require temporary flooring. The business offers a rapid, reliable and personal service and employs highly trained and skilled carpet fitters. It is for these reasons that so many of customers have stayed loyal to the business year after year. The business has benefitted from much investment by the current owner and is a testament to the positive financial outlook for the company, which is limited only by the owners’ desire to grow and diversify. The business has a very well earned reputation, which is a great asset to the business. All operations are streamlined with low overheads. The customer base is diversified enough to give stability to future earnings with sales spread across them and have been loyal over the years, which provides much confidence in future earnings from which to build. Equipment: The company has the benefit of modern tools to enable highly customisable products for customers. Customer Service: The exhibition and contract flooring side of the business is managed with the highest customer service quality levels and is backed by ESSA standards of supply. Whilst competing in the market with some major retailers in carpets and floor coverings, the company has carved out and developed a niche with loyal local customers and retails its products in a welcoming showroom environment within the larger part of the business’ commercial operations. This is not only due to the custom nature of the company’s products but also competitive pricing and a focus on sourcing key quality products, of the widest possible variety that are used in the final customized fitting, along with friendly, knowledgeable and professional service at all times. Key Strengths: • Reputation – Niche, well known and respected in the industry • Knowledge – Key staff • Product quality – Product integrity paramount at the highest levels of performance • Service – Always highest quality • Variety – Widest selection of floor coverings available • Re-sale – Additional margin generated from the resale of commercially used and reclaimed floor coverings • Marketing & advertising – The business is very sophisticated in its use of promotional activities to drive business • Costs control – No stone is left unturned in the quest for control over costs and the elimination of waste • Culture – The employees are all committed and have been trained by the company and are steeped in these key aspects and company strengths Critically the marketing and reputation are responsible for maintaining goodwill, driving referrals, repeat custom and new sales. Growth and Expansion Opportunities: The business operates very much within the scope of the vendors’ self-imposed limits and could grow rapidly by expanding the business reputation into a better known brand by means of a determined investment in marketing, advertising, and typical brand building techniques. It is believed by the vendors that the current levels of marketing commitment have touched only a small part of the company’s potential in the UK, particularly in relation to the demand for discounted used floor coverings for the commercial sector. Employees: The vendor is responsible for day to day running of the business and is ably assisted by a team of eight full time and two part time employees: 1x Sales/Operations Manager 5x Carpet/Flooring fitters 1x apprentice 1x Retail Sales Manager 2x Part Time Office Administrators Advertising and Marketing: The business advertises on Google and has a fully comprehensive website which details the current catalogue & product line and also all available accessories. The business also sponsors local road junction roundabouts which in combination with local interest magazines, creates awareness and footfall in the retail part of the business. For the larger part of the business which is exhibition floorcoverings, the business takes advertising space in well known and well subscribed to, trade magazines. Premises: The business operates from two storey showroom, warehouse, workshop and office premises on a busy, trading estate in a building of circa 10,000 square feet to include: office mezzanine of circa 300 square feet, storage, workshop, showroom area and kitchen & toilet facilities and circa 2,500 square feet frontage for parking. The premises benefit from a comprehensive security system with alarm and CCTV cameras protecting people, premises and goods within the estate. The premises are currently freehold and in the ownership of the company; the freehold is available or a new lease could be assigned. Annual rates are circa £9,000.00 per annum. Business Hours: Monday, Tuesday, Wednesday, Thursday Friday: 9:00 am - 5:00 pm Saturday: 10:00am – 4:00pm Financial Information: The business is being offered for sale on a going concern basis, all financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler. Year End 2020 Turnover circa £790,000 Year End 2020 Gross Profit circa £508,000 Average recent 3 year adjusted EBITDA circa £204,000 Net Assets circa £520,000 (inc. freehold, stock, vehicles, equipment) Reason for Sale: The vendor believes that the time is right to pass the opportunity to a new owner for full and proper exploitation of the opportunities for growth, to come. Support and Training: The owners are happy to provide training for an agreed handover period. Asking Price: The Asking Price of £700,000 plus net assets is for 100% of the issued capital of the company, assuming Net Assets of c£506,000 on completion (calculated on a zero cash-zero debt basis). The final selling price will have a £1 for £1 adjustment for any rise or fall in this benchmark Net Asset figure of £506,000 at completion.

For more information on AG146 - Specialist Flooring Supplier talk to Turner Butler Limited (Business Broker)