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Dog Boarding and Grooming in Wisconsin

Two great locations!

CASH FLOW
$240,631

Specifications

  • Price
    $782,000

  • Revenue
    $691,220

  • Profit Margin
    35%

  • Cash Flow
    $240,631

  • Inventory
    $45,000: Pet food, treats, leashes, collars, bedding, apparel, toys, flea and tick treatment, etc

  • Reason for Sale
    Retirement

  • Location
    Southern Wisconsin, Northern Illinois

  • Service Area
    Local customers

  • Equipment
    $248,000: Kennels, grooming equipment, office equipment, furniture, fixtures, wash stations, 1 van

  • Lease
    Location 1: 8,000 sq. ft.; Location 2: 6,500 sq. ft.; Both locations: Self-wash stations, grooming, retail, boarding kennels; Daycare play areas are at location 1

  • Employees
    12: Shared between locations, 5 groomers, 7 customer service and play attendants

  • Intangible Assets
    True love for animals, focus on healthy products, adorable branding

Dogs and cats are welcome at this Southern Wisconsin/Northern Illinois grooming, daycare, and boarding center.  With two spacious locations, this business can accommodate 109 for boarding, and at one location 30 dogs for daycare.  One location has a large daycare play area where dogs can romp and tumble from morning until night.  Self-wash stations are available for customers to bathe their own pets while professional grooming services are available for those who need a nail trim or specialty cut.  The owners currently manage the finances as well as the marketing and many of their oversight duties can be assumed by current staff. 

 

This company has two locations outfitted with one self-wash station each, many kennels, indoor and outdoor play areas, and a large retail floor.  Location one has 8,000 square feet, while location two has 6,500.  The twelve staff members are shared between both locations.  Seven team members assist customers and are play attendants while five are groomers.    

 

With few competitors in the area, this business has plenty of room to grow with consumer demand.  Online sales could increase, and a delivery option could be considered.  One location has room to expand into underutilized space, creating a greater capacity for canine customers.  In addition, building a social media following as well as a review campaign could help customers engage with the business and create community behind the brand. 

Business Highlights

  • Year Established: 1990
  • Location: Southern Wisconsin, Northern Illinois
  • Service Area:  Local customers
  • Services: Pet self-wash, grooming, boarding, daycare, retail
  • Buildings:  Location 1: 8,000 sq. ft.; Location 2, 6,500 sq. ft.; Both locations: Self-wash stations, grooming, retail, boarding kennels; Daycare play areas are at location 1
  • Reason for Selling: Retirement
  • Employees: 12: Shared between locations, 5 groomers, 7 customer service and play attendants
  • Seller Training Period: 90 days or as negotiated
  • Growth Opportunities: Online retail sales, Location 1 has room to add additional kennels and play areas, build social media following and engagement
  • Current Owners’ Responsibilities: Financial management and marketing, both work part-time

Financial Highlights

  • List Price: $782,000
  • Gross Sales:
    • 2018: $691,220
  • Cash Flow:
    • 2018: $240,631
  • Assets Included in Purchase*
    • Equipment: $220,000: Kennels, grooming equipment, office equipment, furniture, fixtures, wash stations
    • Vehicles: $28,000: 1 van
    • Inventory: $45,000: Pet food, treats, leashes, collars, bedding, apparel, toys, flea and tick treatment, etc.
    • Intangible Assets: True love for animals, focus on healthy products, adorable branding

*amounts may vary, assets may be depreciated, replacement cost, or fair market value 

Cash Flow Analysis

Description of Financial StatementTax ReturnTax ReturnTax Return
Combined
Tax ReturnTax Return
Combined
Tax ReturnTax Return
Combined
Tax ReturnTax ReturnNotes
201820182018201720172017201620162016
GROSS SALES$264,487$426,733$691,220$268,690$703,670$434,980$742,066$303,530$438,476
Net Income Shown on Financial Statement$22,376$15,513$37,889$-3,596$-3,594$0$43,792$33,664$10,128
ADDBACKS
Depreciation$12,031$8,265$20,296$58,946$66,311$7,365$11,484$4,692$6,792
Interest$5,499$0$5,499$0$0$0$24,638$24,638$0
Auto-Personal Use$5,668$302$5,970$3,730$4,212$482$4,502$3,646$85690% Personal
Cell Phone$0$1,200$1,200$0$1,200$1,200$1,200$0$1,200Personal
Travel Expense$1,533$4,442$5,975$3,247$8,184$4,937$5,074$4,129$94590% PErsonal
Compensation to Owner$19,637$96,765$116,402$0$118,963$118,963$115,275$0$115,275
Rent Adjustment$0$0$39,500$0$36,000$0$36,015$0$0Ongoing rent for combined is $6k/month
Repairs$0$0$7,900$0$0$0$0$0$0
TOTAL ADDBACKS$44,368$110,974$202,742$65,923$234,870$132,947$198,188$37,105$125,068
Seller's Cash Flow = Total Addbacks + Net Income$66,744$126,487$240,631$62,327$231,276$132,947$241,980$70,769$135,196
Profit Margin25.24 %29.64 %34.81 %23.19 %32.87 %30.56 %32.61 %23.32 %30.82 %
  • Profit Margin 2018: 35%

Services

  • Pet self-wash
  • Grooming
  • Boarding
  • Retail
  • Daycare at one location

Employees

Total Employees: 12

  • Shared between locations
  • 5 Groomers
  • 7 Customer service and play attendants

Growth Opportunities

  • Online retail sales
  • Location 1 has room to add additional kennels and play areas
  • Build social media following and engagement

Valuation Details

The Firm used a cash flow valuation methodology to determine the purchase price of the business. 

The formula used is as follows:

Cash Flow       x          Prescribed Multiple     =          Fair Market Value

Cash flow is the sum of business net income plus any owner perks and any non-onward going expenses.

A prescribed multiple is determined by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiplier.

For this business, a 2018 cash flow was used with a prescribed multiple is 3.25.  With this information, the computation is as follows:

$240,631         x          3.25     =          $782,051

The fair market value found above positions the business list price at $782,000.

Funding Example

Purchase Price:                                $782,000

12.5% Buyer Down Payment:            $97,750

12.5% Seller Financing:                     $97,750

75% Bank Loan:                                $586,500

Seller financing 5-year term at a rate of 4.50% equals a monthly loan payment of $1,822.

Bank loan 8-year term at a rate of 6% equals a monthly loan payment of $7,707.

After business expenses and loan payments, a buyer with a 12.5% down payment of $782,000 would retain a profit of $126,273, which results in a 129% return on investment in the first year.

A lender is required to have a minimum 1.5 coverage ratio for any business loans extended. At a proposed purchase price of $782,000 with the terms listed above, the coverage ratio is 2.1. 

Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available. 

*The Firm is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.

Purchase Price:

$782,000

$
%
OR
$
%
OR
$
Years
%

Bank Loan Needed: $

Years
%
$
$
$
$
$

Funding Details

Business:

Offer Price: $

% Buyer Cash Down at Closing: $

% Seller Carry Back via Promissory Note: $

year term at a rate of %

% of Purchase Price secured by Buyer and Seller

Total Bank Loan Need: $

% of Purchase Price

Desired Loan Type:

Desired Bank Terms: year term at a rate of %

Total Business Assets, Inventory, and A/R: $

Total Undercollateralized Loan: $

Loan Payments

Monthly Payment to Bank: $
Yearly Payment to Bank: $
Monthly Payment to Seller: $
Yearly Payment to Seller: $
Total Monthly Debt Service: $
Total Yearly Debt Service: $

Conclusions

Fixed Charge Coverage Ratio

The bank will require a minimum ratio of 1.5 to be lendable.

Cash Flow:
2018 Cash Flow
$
Annual Debt Service: $
RATIO:

Buyer's Net Operating Income (NOI)

The amount of money the Buyer will retain as profit.

Cash Flow:
2018 Cash Flow
$
Annual Debt Service: -$
NOI:

Buyer's Return on Investment (ROI)

The rate of return on the Buyer's down payment.

Down Payment: $
NOI:
ROI: %

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210 N 78th St. 2nd Floor
Omaha, NE 68114

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The Firm is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.