Opportunities
Colorado Translation, Interpreting, and Language Center
Sold
Successful company with holistic approach and 23% profit margin!
Specifications
This dynamic and turnkey translation business is located in beautiful Colorado. With the philosophy of helping anyone with any translation need, this company has grown and expanded its services to provide holistic and consistent language services to its customers. Offering services in the areas of translation, interpreting, and language classes, this well-rounded approach has helped this business grow by 69% in just four years. This location is also a TOFL testing center and all interpreters are TCI certified or experience equivalent and translators are ATA certified or equivalent. This company Interprets in over 50 languages in person, over 120 languages pre-scheduled, and over 48 languages are offered for translation. Classes are offered in 11 languages including ASL and courses in cultural awareness are also offered. Courses are offered to groups, corporations, militaries, and individuals alike.
With customers from wide-ranging backgrounds, these language professionals can adapt to the needs of both corporate and individual clients. Local corporations, governments, militaries, schools, health care providers, and lawyers are a good portion of the client base, with the remaining portions being individual clients.
Located in an attractively renovated home, this space contains classrooms, a language lab, a conference room, a full kitchen, and a private parking space. Ample free street parking can be found in the surrounding area.
Business Highlights
- Year Established: 1999
- Location: Colorado
- Service Area: Colorado
- Clients: Governments, health care, lawyers, militaries, corporations, schools, individuals
- Services: Translation (25%), Interpreting (65%), Language Classes (10%)
- Building: 3,400 sq. ft. 2 levels, language lab (1), kitchen, conference room, classrooms (6)
- Reason for Selling: Capital for other ventures
- Employees: On Site: Interpreting (2), Translation (1), Class Coordinator (1), Office Manager (1), HR Admin (1), As Needed: 50 Interpreters, translators, teachers
- Seller Training Period: 90 days transition
- Growth Opportunities: Expand client base, Increase Denver-based employees, Expand employees throughout Colorado, Offer hybrid classes
- Current Owner’s Responsibilities: Business Development, Oversight, Innovation
Financial Highlights
- List Price: $768,000
- Gross Sales:
- 2018: $1,305,898 Annualized
- 2017: $939,952
- 2016: $942,903
- 2015: $904,798
- 2014: $555,626
- Cash Flow:
- 2018: $383,311 Annualized
- 2017: $212,885
- 2016: $200,954
- 2015: $239,249
- 2014: $162,127
- Assets Included in Purchase*
- Intangible Assets: Outstanding reputation, long-term client relationships, holistic approach
Cash Flow Analysis
| Description of Financial Statement | P&L Statement | Tax Return | Tax Return | Tax Return | Tax Return | Notes |
| 2018 | 2017 | 2016 | 2015 | 2014 | ||
| GROSS SALES | $544,124 | $939,952 | $942,903 | $904,798 | $555,626 | |
| Annualized | $1,305,898 | |||||
| Net Income Shown on Financial Statement | $157,857 | $87,296 | $95,694 | $134,329 | $92,421 | |
| ADDBACKS | ||||||
| Compensation to Owner | $0 | $92,541 | $80,000 | $84,923 | $51,415 | |
| 11% Tax on total W2 Salaries | $0 | $10,180 | $8,800 | $9,342 | $5,656 | |
| Depreciation | $0 | $3,301 | $4,550 | $1,722 | $4,253 | |
| Amortization | $0 | $8,766 | $5,867 | $5,867 | $5,866 | |
| Meals & Entertainment | $1,338 | $1,679 | $2,338 | $1,866 | $1,316 | |
| Cell Phone | $500 | $1,200 | $1,200 | $1,200 | $1,200 | $100/month |
| Travel | $18 | $130 | $2,505 | $0 | $0 | |
| Retirement | $0 | $4,096 | $0 | $0 | $0 | |
| Medical | $0 | $3,696 | $0 | $0 | $0 | |
| TOTAL ADDBACKS | $1,856 | $125,589 | $105,260 | $104,920 | $69,706 | |
| Seller's Cash Flow = Total Addbacks + Net Income | $159,713 | $212,885 | $200,954 | $239,249 | $162,127 | |
| Annualized | $159,713 | |||||
| Profit Margin | 29.35 % | 22.64 % | 21.30 % | 26.44 % | 29.18 % |
69% growth since 2014!
Typical Clients
Corporations
Governments
Militaries
Schools and School Districts
Lawyers
Health Care Providers
Individuals
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
Services
- Translation 25%
- 48+ languages
- ATA certified translators or equivalent in 15 languages
- Documents
- Manuals
- Birth Certificates
- Marriage Licenses
- Newsletters
- Flyers
- Interpreting 65%
- 50 languages in person – 120 languages pre-scheduled
- On-site and telephone translating
- Depositions
- Meetings
- Instruction
- Healthcare
- Classes 10%
- 11 language classes
- On-site and off-site instruction
- Group, small group, and individual instruction
- Language Lab on site
- Culture awareness classes
This business is on the cutting edge of technology for requesting and scheduling services. They utilize 3 platforms, one for each division, to improve job flow, easy of understanding, and payment.
Employees
Interpreting (2)
Translation (1)
Class Coordinator (1)
Office Manager (1)
HR Admin (1)
As Needed
Interpreters
Translators
Teachers
95% of interpreters, translators, teachers, and administration are employees
5% are 1099 contractors
Growth Opportunities
Increase Denver-based employees
Expand employees throughout Colorado
Offer hybrid classes
Valuation Details
The Firm Business Brokerage 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 2017 Cash Flow was used with a prescribed multiple is 3.61. With this information, the computation is as follows:
$212,885 x 3.61 = $768,515
The Fair Market Value found above positions the business List Price at $768,000.
Funding Example
Purchase Price: $768,000
10% Buyer Down Payment: $76,800
10% Seller Financing: $76,800
80% Bank Loan: $614,400
Seller Financing 5-year term at a rate of 4.50% equals a monthly loan payment of $1,432.
Bank Loan 8-year term at a rate of 6% equals a monthly loan payment of $8,074.
After business expenses and loan payments, a buyer with a 10% down payment of $76,800 would retain a profit of $98,814, 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 $768,000 with the terms listed above, the coverage ratio is 1.87.
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.
Print, sign and send to:
210 N 78th St. 2nd FloorOmaha, NE 68114
Or fax to:
f 402.939.0857