Finding and evaluating a business for sale

¶ … Business for Sale

The modifications in the micro and macro environments are commencing to influence individual decisions more and more. For instance, they have even managed to influence investors in buying an already existent organization, rather than opening a new one. Purchasing an already existent business has numerous advantages over the opening of a new one. Among these benefits, one could point out the fact that the organization already has an operational facility, possesses employees and has already built relationships with the suppliers and the customers, meaning then that it already possesses a customer base which makes it easier to distribute the products and deliver the services. In the case of opening a new business, achieving the above desiderates involves a wide series of additional financial and non-financial efforts. Another major benefit of purchasing a business is that the buyer is able to identify several selection criteria and buy a company which satisfies those particular demands. The downside of it however, is that other people built it before you, and they did this according to their personal agenda, meaning than it could be quite difficult to find the one business that meets the established criteria.

The business I was thinking of purchasing deals with pets and the most important criteria it would have to meet are succinctly presented below. I do not expect to find all criteria within a single organization, but I will prioritize the most important ones in the detriment of those I do not find as impending, or which I can easily resolve myself.

A the company would offer services, rather than retail the location would have to be in a highly populated area, preferably near a park; it would have to be easily accessible for both neighbours in the region as well for those passing by it would have to possess a vast customer palette it would have to benefit from partnerships with suppliers and other business partners; the contract should be flexible as to offer the possibility for modifications and additions the company would also have to possess skilled staff members, who show a real interest in caring for the pets; they should possess previous expertise in offering pet services it is preferable that the company had already created a name for itself and that their marketing strategy is based on the high quality of the products and services delivered, as well as the brand the financial criterion is also an important one, meaning that the company must have ended the previous year on profits the return on investment should be achieved in no more than five years

According to the selection criteria identified above, several alternatives are made available. These include eleven service stores in the area of New York:

Profitable Home-Based & Mobile Dog Grooming Service (Dutchees and Ulster Counties): it sells for $126,000 and registers annual sales of $155,000 and a net profit of $100,000. The company has one full time employee, has been operating for 13 years and can easily be relocated or operated from home.

Dog Grooming and Boarding Center: the asking price is of $1,595,000 and its annual sales are of $1,350,000, with a net profit of $423,000. It has been operating for two years with 9 employees and it is a high quality store offering superior services.

Baby, Home, Pet Sitting (New York): the price is of $35,000, with revenues of $94,182 and a net profit of $15,000.

Great Pet and Pet Supply (Suffolk County): the asking price is of $250,000 and the revenues are of $273,186, with a net profit of $135,882. It has been operating for two years with 3 employees.

Dog-Friendly Travel, Canine Exercise and Pet Boarding (New York): selling for $125,000, annual sales of $60,000 and net profits of $40,000. Established in 2003, the business can be run from home.

Kennel with Grooming Facility (Suffolk County): sales for $499,000, registers $450,000 annual sales and a net profit of $40,000. Opened in 1994, the store is located on the main road.

Pet Grooming Salon (Rockland County): the asking price is of $60,000, the annual revenues of $49,963 and the net profits of $26,006. Operating since 1986, the company is located at the border of New York and New Jersey

Dog Grooming Biz (Suffolk County): it asks for $150,000, registers $210,000 annual sales and $100,000 net profits. It is located in a highly competitive area and the seller is not flexible to the payment method.

Pet Grooming Salon (Long Island): the asking price is of $180,000, with $250,000 in annual sales and a profit of $110,000. It offers both products as well as grooming services.

Pet Grooming Business (Long Island): it goes for $125,000 and annual revenues of $227,000; net profit of $75,000. With 30 years of experience, they offer high quality services and have built a loyal customer palette.

Pet Shop and Groomer (Queens County): the asking price is of $80,000, with annual revenues of $104,000 and a net profit of $72,508. Operating for ten years, the company has yet to reach its maximum potential.

The company that best meets the desired requirements is the Pet Grooming Business in Long Island. Not only do they meet the criteria of specialized and dedicated personnel, a vast customer palette, an excellent reputation and real profits, but the owner is opened to discussing methods of payment. The financing possibilities within the pets industry are generically vast, but this only applies in theory, as in practice, there are those owners who want all the money up front and are not open to discussions. In other words, financing a business in the pest industry is as challenging as with any other business and extremely sensitive to the agreements reached by seller and buyer. The return on investment upon purchasing the Pet Grooming Business would be available in two years, meaning as such that the credit officer would feel inclined to approve the loan.