Distribution / Dist-Hardware
We are pleased to present for sale this well-established and over
30+-year-old profitable, global distribution company that distributes
fasteners, machined parts, apparel, janitorial / sanitation and general
MRO (maintenance, repair, & operations products) such as hand tools,
abrasives, chemicals, etc. Services provided include Vendor Managed
Inventory (VMI) along with custom and commercial volume import
procurement. The company has been largely absentee operated by its owner
for the past two years while the owner focused on a development project
and seeks a slower pace of life.
This company has consistently generated revenues of between $3.7M and $6.4M in revenues and between $310K to $650K in SDE (seller’s discretionary earnings) over the past several years. Softening in the manufacturing sector in 2018 related to tariff wars appears to have subsided. The company maintained core revenues on repeat customer business over the past few years as they have not had any outside sales representatives during this time frame. This can be attributed to a sales mix of 32% VMI bin stock and 23% short to long term contract volume base.
While Covid-19 restrictions are continuing to limit the business’ external customer operations, the company’s financial performance is starting to show some resilience. Revenue projections for the month of August is projected to be at least $225,000, which is approximately 70% of its typical run rate for year 2019, during which time it generated $4.3M in revenues and cash flow of $582K.. September and beyond month’s performance will depend on how quickly their customers fully re-open and ramp up their operations, which we would anticipate that it would be as quickly as possible. While the company’s revenues have been impacted by COVID-19, the company is not aware of having permanently lost any of its customers due to the pandemic.The seller is committed to ensuring a successful transition to the successful buyer and will remain on board for up to six months after closing for training & transitional support.
This business has been pre-qualified for SBA financing by two different SBA Lenders. The buyer will generally be required to inject up to 15%, in cash, of the purchase price as a down payment and will also need to meet standard credit qualification criteria.