Procurement, Design, & Layout of Furnishings for Schools
Business Manager in place who oversees the 20 qualified and talented staff!
With a Business Manager in place who oversees the 20 qualified and talented staff, a 12.5% down payment of $400,000 returns $477,215 in the first year after debt payments. This contract furniture dealer and installation business dealer has clientele comprised of educational facilities (65%), corporations, and healthcare (10%) and had over $16M in revenue in 2019. Well-established for over 30 years in Harrisburg, PA, this company is known for their creations of innovative spaces. With three impressive showrooms in the Harrisburg area, their vast array of products include seating, desks, tables, classroom furniture (for K-12 and higher education), architectural space (walls, glass enclosures, panels, screens, flooring & rugs) and work tools (whiteboards, podiums, ergonomic office tools, lighting). The current owner only works 20 hours a week, given the highly talented Business Manager in place. Selling a low multiple of 2.5, a buyer’s ROI the first year is at 119%. Profits are 477k after all debt payments!
A highly experienced team is in place and includes 1 business manager, 6 designers, 2 project managers, 3 installers, 7 sales staff, and one person in customer service/office administration. They work both in the office and remotely, partnering with numerous manufacturers to bring their clients exactly what they’re looking for in a creative work environment. Sample showroom pieces comprise their low inventory.
Year-over-year growth since 2017 proves they have a strong client base and remarkable word of mouth advertising. Adding online sales, increasing social media presence, and optimizing the SEO are all areas that would add tremendous growth to the company.
- Year Established: 1989
- Location: Harrisburg, Pennsylvania
- Service Area: Primarily within Pennsylvania with some clients in Maryland and Delaware
- Clients: Educational facilities (65%), general commercial, and healthcare (10%)
- Services: Furniture dealer: layout and installation
- Lease: 3 showrooms: Location 1: 5,000 sq. ft. showroom/office + 10,000 sq. ft. warehouse + 4 docks; Location 2: 1,200 sq. ft. showroom; Location 3: 4,000 sq. ft. showroom
- Reason for Selling: Retirement
- Personnel: 20: 6 Designers (5 FT, 1 PT), 2 Project Managers, 1 Business Manager, 3 installers, 7 sales staff, 1 admin
- Seller Training Period: 1 year if desired
- Growth Opportunities: Add online sales, social media, optimize SEO
- Current Owner’s Responsibilities: Only works 20 hours/week; there is a highly talented business manager in place
- List Price: $3,200,000
- Gross Sales:
- 2019: $16,283,769
- 2018: $13,700,427
- Cash Flow:
- 2020: $1,745,706 annualized
- 2019: $886,441
- Assets Included in Purchase*
- Equipment: $105,353: Racking, office equipment
- Vehicles: $375,920: Forklift, three 24-foot box trucks
- Inventory: $7,358 (Very low – no inventory other than sample showroom pieces)
- A/R: $536,129
- WIP: $609,910
- Intangible Assets: Well-established name for over 30 years, strong and loyal client base, word of mouth advertising
Cash Flow Analysis
|Description of Financial Statement||P&L Statement|
|Tax Return||Tax Return||Tax Return||Tax Return||Notes|
|Net Income Shown on Financial Statement||$1,076,312||$664,028||$385,591||$27,569||$330,811|
|Compensation to Owner||$87,750||$154,558||$268,823||$231,395||$211,671|
|11% Tax on total W2 Salaries||$17,001||$17,001||$29,570||$25,453||$23,283|
|Meals & Entertainment||$3,012||$7,865||$10,621||$8,591||$12,451|
|Officer's Life Insurance||$2,531||$3,797||$3,797||$3,797||$3,797|
|Seller's Cash Flow = Total Addbacks + Net Income||$1,163,804||$886,441||$764,675||$267,229||$550,119|
|Profit Margin||14.11 %||5.44 %||5.58 %||3.78 %||6.02 %|
Year-over-year growth since 2017!
- Education (K-12 and Higher Ed)
- Healthcare Facilities
- PA State Contract
- U.S. Communities
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
- Furniture supply, design, delivery, and installation
- Space Planning
- Project Management
- Product Inventory
- Inter-Market Installs
- Bid Preparation
- Cost Analysis
- 1 Business Manager
- 6 Designers
- 5 FT, 1 PT
- 2 Project Managers
- 3 Installers
- More subcontracted out for larger projects
- 7 Sales Staff
- 1 Admin
- Add online sales
- Increase social media presence
- Optimize SEO
Purchase Price: $3,200,000
12.5%Buyer Down Payment: $400,000
12.5%Seller Financing: $400,000
75%Bank Loan: $2,400,000
Seller financing 5-year term at a rate of 4.50% equals a monthly loan payment of $7,457.
Bank loan 10-year term at a rate of 6% equals a monthly loan payment of $26,645.
After business expenses and loan payments, a buyer with a 12.5% down payment of $400,000 would retain a profit of $477,215, which results in a 119% return on investment in the first year.
A lender is required to have a minimum 1.25 coverage ratio for any business loans extended. At a proposed purchase price of $3,200,000 with the terms listed above, the coverage ratio is 2.17.
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.
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: $
|Monthly Payment to Bank:||$|
|Yearly Payment to Bank:||$|
|Monthly Payment to Seller:||$|
|Yearly Payment to Seller:||$|
|Total Monthly Debt Service:||$|
|Total Yearly Debt Service:||$|
Fixed Charge Coverage Ratio
The bank will require a minimum ratio of 1.5 to be lendable.
2 Yr. Avg. ('19-'20) Cash Flow
|Annual Debt Service:||$|
Buyer's Net Operating Income (NOI)
The amount of money the Buyer will retain as profit.
2 Yr. Avg. ('19-'20) Cash Flow
|Annual Debt Service:||-$|
Buyer's Return on Investment (ROI)
The rate of return on the Buyer's down payment.
|Document Title / Description|
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