Opportunities
Flow Monitoring & Ventilation
Sold
Industrial, commercial and governmental market specialists
Specifications
Services include filtration and silencing replacements on rotating equipment (turbines, compressors, reciprocating engines, fans, and power generating equipment) and upgrades to existing systems such as ductwork, silencers, housings, inlet & exhaust systems, dust collection, air scrubbing, and mist elimination. Design assistance is also offered including PE flow diagrams to improve system performance.
The current owners provide sales, accounting and client/supplier relations, while two part time employees provide additional accounting services and professional engineering. A new owner will need to relocate this business as work is based out of a home office. Growth opportunities include building an internal construction team and outside sales force for in-house development.
Business Highlights
- Year Established: 2003
- Location: Louisiana
- Service Area: 90% Louisiana & Mississippi with natural gas services provided nationally
- Number of Clients: 100
- Demographics: Industrial, commercial and governmental markets
- Services: Intake & exhaust filtration/silencing equipment replacements, fans/compressors, upgrades and professional design services, DEQ permitting, flow monitoring, sales & service
- Building: 450 sq. ft. home office
- Reason for Selling: Focus on family
- Employees: 2: PT Engineer, PT Accountant
- Hours: M-F 8am-5pm
- Seller Training Period: 3 months
- Growth Opportunities: Build an internal construction team along with a motivated outside sales staff
- Current Owner’s Responsibilities: Sales, accounting, client & supplier relations
Financial Highlights
- List Price: $179,000
- Gross Sales:
- 2018: $295,864
- Cash Flow:
- 2018: $74,946
- Assets Included in Purchase*
- Equipment: $$7,000: Flow monitoring equipment, furniture and fixtures
- A/R: $30,000
- Purchase Orders: $130,000
- Intangible Assets: Offering a specialized service to a loyal client base with strong relationships
*amounts may vary
Cash Flow Analysis
| Description of Financial Statement | Tax Return | Notes |
| 2018 | ||
| GROSS SALES | $295,864 | |
| Net Income Shown on Financial Statement | $-17,660 | |
| ADDBACKS | ||
| Compensation to Owner | $58,117 | |
| 11% Tax on total W2 Salaries | $6,393 | |
| Depreciation | $2,252 | |
| Interest | $5,254 | |
| Auto/Travel Expense | $4,800 | $400/month |
| Rent | $6,150 | Home Office |
| Cell Phone | $840 | $70/month 2 lines |
| Health & Dental Insurance | $4,800 | $400/month |
| Auto Insurance | $1,500 | |
| 401k | $2,500 | |
| TOTAL ADDBACKS | $92,606 | |
| Seller's Cash Flow = Total Addbacks + Net Income | $74,946 | |
| Profit Margin | 25.32 % |
.
Typical Clients
- Industrial
- Commercial
- Governmental
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
Services
- Filter replacements & systems: Turbines, compressors/inlet air
- Upgrades “retrofits” to existing systems: Ductwork, silencers, housings, inlet & exhaust systems, industrial fans and parts, dust collection, air scrubbing, and mist elimination
- Design/build assistance: PE flow diagrams to improve system performance
- DEQ permitting: services for industry on outfalls
Employees
- (1) Part-time Engineer
- (1) Part-time Accountant
Growth Opportunities
- Growth opportunities include building an internal construction team and motivated outside sales force for in-house development
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 multiple is prescribed 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 multiple.
For this business, a 2018 cash flow was used with a prescribed multiple is 2.3. With this information, the computation is as follows:
$74,946 x 2.3 = $172,375
The fair market value found above positions the business list price at $179,000.
Funding Example
Purchase Price: $179,000
Buyer Down Payment: $30,000
Seller Financing: $79,000
Bank Loan: $70,000
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 Business Brokerage is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.
Print, sign and send to:
210 N 78th St. 2nd FloorOmaha, NE 68114
Or fax to:
f 402.939.0857