Specialty wholesale giftware business w/ real estate - Click For Details
For several generations, over 60 years, this wholesale company has proven itself to be an established player in their respective field in Atlantic Canada. With several exclusive lines focused on the Atlantic Canadian giftware industry, along with a long line of offerings that are ever changing based on demands of the client base. Some of those items include Pottery, Pewter, Throw Rugs & Mats, Candles & Soaps, specialty Knives, Jewelry, Books & Food items, Tartans & Scottish, T-shirts & Souvenirs.
Primary focus is NS with some customer base outside NS. The operations are managed with little to no technology, no e-commerce, and continues to benefit from grass roots marketing efforts (face to face sales) .
There is a very cooperative staff, with are a total of 4 sales staff and 8 office/warehouse staff (FT and PT). There is an RRSP sharing program, a health plan, and a long term disability plan in place for staff.
A sale could be considered without the real estate. The expected minimum equity requirement without the real estate would be $300k and $450k with the real estate.
$1.05M in most recent revenues have generated Seller's Discretionary Earnings (SDE) of $111k. SDE calculation is after normalizing for "rent" payments of $39k per annum, which is sufficient to service a commercial mortgage and provide an 8% return on the invested capital required to own this real estate.
- Fiscal year end is December 31
- Revenues and profits have been growing year over year for the past several years, with 2018 already double digit growth ahead of 2017 results.
- Over 95% of all sales are wholesale. Relocation potential.
- Average inventory levels have been shrinking, most recent YE, $443k, which only $67k of the LOC was used. Company does have a $450k LOC available. Fall is best for lowest inventory. Inventory is included in the purchase price and will be counted on closing, and pricing will adjust accordingly.
- Recent Canadian European Trade Agreement, where all products produced in Europe coming into Canada, are now duty free. Duties ranged from 7% to 18%.
Minimum Equity Required
Owned property included, but not required, in sale:
A two story, 6,941 square foot building, with retail, office, and warehouse/storage, with appropriate loading docks, conveyor and storage systems.
There is a 2,030 sft duplex with 2 bedroom apartments, generating $16,800 in income.
- 3 separate lots, all connected, having a combined area of 26,931 sq. ft. Zoning is C1 - Major Commercial Zone
- municipal septic and water
- As of September 2017, property taxes totalled $7263
Approximate value of $550k. Commercial mortgage at 70% LTV, 20 year amortization, 5% would require payments of $2,530/month. (see financial details above for cash flow calculations)
Non Disclosure Agreement
I hereby acknowledge that information regarding the following business(es) and/or Seller(s) is being provided to me in SECRECY AND CONFIDENCE and is to be used solely for the purpose of assessing the prospective purchase of the business(es) through Gateway Business Brokers.
I agree not to disclose any of the information given in connection herewith, either directly or indirectly, to third parties, except direct support people; nor will I use, or assist others to use, any such information for competitive trade purposes or to circumvent Gateway Business Brokers in any transaction or contact with the seller(s). I agree not to make copies of any of the material provided and to return all of it if I discontinue interest in the Business. The material and information furnished is believed to be reliable for the purpose of evaluating the Business. Further, I agree that all inquiries, investigations, negotiations, offers to purchase, and/or letters of intent must be made through Gateway Business Brokers. I agree to protect and not disclose the confidentiality of the information I receive permanently, even if I choose not to purchase the said business.
I agree that any breach of this Non-Disclosure Agreement (the "Agreement"), directly or indirectly, will be harmful to the Seller(s) and Gateway Business Brokers. In consideration for the information given, I agree that the laws of Nova Scotia will govern this Agreement and that all actions that may arise in law and/or equity shall be brought in Nova Scotia.
It is understood that this Agreement also applies to any information previously supplied by Gateway Business Brokers, verbally or in writing. I understand that neither the Seller(s), the Business(es), its officers, directors, employees, nor Gateway Business Brokers ,shall have any liability as a result of furnishing me the material included in this Agreement.
This agreement also acknowledges that the undersigned Buyer(s) has (have) been advised that Gateway Business Brokers provides Client representation for the seller(s) and Customer representation for the buyer(s) in this transaction, as per the terms that have or will be provided. I agree that should I buy, lease or come into possession of the Business, in whole or part, during the listing term or within 1 year from the expiry date of the listing term, Gateway Business Brokers’ right to a fee, as per Gateway Business Brokers’ agreement with the Seller(s), will be deemed earned. I understand I will be personally liable for payment of any applicable fees, as so reasonably determined, if I breach any clause of this agreement. It is agreed, however, that if a purchase is completed with the assistance available from Gateway Business Brokers, I am not liable for a fee.