Business Overview:
Gateway Business Sales (GBS) represents an industry leading distributor of custom packaging, shipping, and janitorial supplies. The business is located in Orange County, California and operating successfully for over 50 years.
Investment Highlights:
• Product offering comprises a wide variety of boxes, bags, tapes, cartons, adhesives, dispensers, envelopes, packing materials, labels, paper and related dispensing machines. Management estimates the Company offers over 100,000 unique sku’s and provides shipping services to local customers.
• Customer base mainly consists of large-scale manufacturers and industrial companies primarily located in Orange and Los Angeles counties of California.
• The Company carries specialty products and provides value added services as well as distinguishing itself from the competition via its reputation for stocking specific items, employing highly qualified and knowledgeable employees, and providing quick turnaround.
• Management estimates the rate of repeat business is 80% and the Company has developed a customer base of over 500 + active accounts.
• The Company represents many of the leading manufacturers in the industry, which enables it meet the diverse needs of its customers
Income & Adjusted EBITDA:
The Sales from August 1,2020 to July 31, 2021 (TTM) were $5,142 mm with adjusted EBITDA of $331k and Sellers Discretionary Earnings (SDE) $481,000. The Company fiscal year ends January 31 and the sales in the 8-month interim period were $3.15 mm and adjusted EBITDA $255,000 and SDE $360,000. The base year projected sales are $5.3 mm and adjusted EBITDA $383,000 and SDE $540,000.
Investment:
The asking price is $1,750,000. The Company’s position in the market along with successful business history as well as sales growth will lead to different value perspectives among various investors. Parties interested in pursuing this transaction will be required to submit a non-binding proposal detailing the preliminary valuation of the company and suggested transaction structure.
Strategic/Synergistic Acquisition:
The established business methodologies are expected to yield growth going forward. Management sites growth through geographic market expansion as well as increased sales and marketing efforts. The Company offers an extensive customer base for a Strategic or Synergistic Company seeking an acquisition platform or to a buyer seeking growth, perhaps by consolidating other related businesses. The business is relocatable so a Buyer could benefit from substantial saving with overheard and operating expenses which would increase the net income.
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Property Features and Assets:
The facility is 10,000 square feet that includes a showroom for customers. Rent is $9,416 per month and lease expires June 2022.
Market Competition and Expansion:
The growth and success have been and will continue to be driven by the Company’s outstanding reputation for distributing quality custom packaging, shipping, and janitorial supplies, supported by superior customer service and timely execution. Nonetheless, the need for a well-conceived sales and marketing program will be integral to take the Company to the next level. Management acknowledges marketing is an area that can be further refined in order to more effectively leverage the Company’s superior name in the marketplace and proven capabilities.
Additional Details:
- The property is owned.
- The owner is willing to train/assist the new owner.
- This is not a homebased business opportunity.
- This is not a franchise resale opportunity.
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