The update in earnings thru Sept 30 2019 means that this is now selling for less than 1 times the earnings plus inventory.  In fact if you take their trailing 12 month earnings plus their cost of their inventory, it adds up to over 650K now and the total sales price of 550K includes the inventory.  THIS IS NOW SELLING FOR 100k LESS THAN THE EARNINGS AND INVENTORY TOTALS COMBINED.  I have never heard of this.

Potential Buyer:

This is a hands on very special retail store that is practically creating a new cult following.  The store is very fun and is a must see.  The trailing 12 months revenues through September 30 2019 were 1.04M with the earnings now up to 296K which is significantly higher than 2018’s 726K in revenue and 169K in earnings.  This company is now selling at less than 1 times the earnings plus less than 80% of their cost of inventory.  The total of the trailing 12 month earnings of 296K plus inventory totals over 650K and she is only asking for 550K total sales price for everything.  She prefers to sell to a buyer who will open other locations with her help.  If her location in a small town can go from 0 to 1.04M in Revenue and 0 to 296K in Earnings in 3 years, a buyer could double that in main street Denver, Colorado Springs, Salt Lake, etc.  She doesn’t have the money to expand to new locations. 

The owner have leased their location since August 2016 and then recently bought their location in December 2018 plus the empty space next door.  This resulted in them doubling the space they were in at the same time. 

For Sale:

MODERN QUILTING CONCEPT STORE

A NEW MODERN FUN STYLE OF QUILTING STORE THAT HAS BRANDING, FRANCHISING, AND MULTIPLE LOCATION POTENTIAL THAT SHOULD CREATE A HUGE EQUITY GROWTH OPPORTUNITY.

Location: Front Range Colorado. 

The trailing 12 months revenues through September 30 2019 were 1.04M with the earnings now up to 296K which is significantly higher than 2018’s 726K in revenue and 169K in earnings.  The company has been growing at a rate of more than 34%.  She believes her 2019 full year properly adjusted earnings will be at least 300K based on their growth rate and she no longer need to build inventory as of March 2019. 

The sales price is only 290K plus only 80% of her cost of merchandise/inventory which totals 550K.  This company is now selling at less than 1 times the earnings plus less than 80% of their cost of inventory.  The total of the trailing 12 month earnings plus inventory totals over 650K and she is only asking for 550K total sales price for everything.  Included in the sales price is more than 80,000 worth of assets that are all less than 3 years old equipment, furniture, technology, and fixtures.  They spent 50,000 just on the custom shelving and racks.  

This is not a normal listing, it is a force of nature, a reinvention of an outdated industry, a potential new national brand, a potential new national franchise, and a place for kids, grandparents and everyone in between.  She is a leading part of a new movement to make quilting fun, modern, and profitable again. 

This business is very special and very valuable to the right buyer.  There is a very large upside to this business by adding locations and building a new brand.  Plus, her current customers come back over and over.  She even has buses come by monthly or periodically from the same places.    

The store is still relatively unknown.  More and more people find out about it every day.  Plus, there other ways to increase revenues and profits.  They make their own custom quilting kits and can expand this with new designs and can sell these online.  These are Fun Designs that range from various holiday patterns, to sports, to hobbies, animals, etc.  Designs you won’t find anywhere else. 

Being in the store and growing this business is a labor of love.  The new owner will continue building equity very quickly and may even decide to make this a national opportunity which could be worth many millions of dollars.  People are looking for fun, hands on hobbies for all ages.  Something fun that is not electronic. 

Traditionally, retail stores are valued at a low multiple plus a negotiated value of the inventory.  Based on the growth and strength of concept and its potential, I believe this company should be priced much higher that the current price she is asking for.  Both Revenues and Earnings are expected to continue to grow.  Keep in mind that her customers are excited about this store and they drive to see it over and over.  If a 2nd location was in Denver, it would be a lot bigger and more successful.  I believe this would be true in every other large market.   This store has a passionate and recurring customer base with loyalty to this concept.   

This is a “Fulfilling and Fun” Business to Own and the Owner feels confident that she can teach the buyer the business easily.  She has to sell even though she is passionate about the business and its future but needs more time off with her family.   This is not a business that can just double or triple.  This is a rare opportunity to create a large amount of future equity while loving what you do. 

The sales price is now 290K plus only 80% of her cost of inventory as of the closing estimated to be 550K total.  This is an LLC. The business is being offered with the Seller keeping her cash, AR, and AP which are not large balances and transferring the business debt free.  This will not quality for a bank loan so the buyer will consider various down payments depending on the strength of the offer and the buyer.