Opportunities
Dog Daycare, Spa, and Lodging
Sold
Offering unique ancillary services to clients!
Specifications
Offering unique ancillary services to clients, this non-franchise business offers much more than animal daycare and boarding. You won’t find the “typical” dog runs and kennels at this location, the accommodations seem more like suites – beyond what new clients would expect. Services include daycare, boarding, dog walking, grooming, and much more!
Generally, there are 55-60 dogs per day for daycare services and an average of 8-10 dogs per day for boarding (depending on the season it could be 10-25). The capacity for the facility is set by the owner – this determination is not part of the city licensing process.
Growth opportunities include expanding grooming services – currently these services generate about $6,000/month in revenue – and increase marketing efforts. This could bring in additional new clients, which currently make up about 30% of the client mix.
The business has been in existence for 5 years, with 2 ½ under the current owners. Both owners are involved with customer service and support, but there are current employees that can step in and cover some of their responsibilities. There are 10 tenured employees, including a full-time groomer, 4 full-time dog handlers, 3 part-time support staff and 2 part-time customer service assistants. The sellers will train a new owner for 90 days.
Business Highlights
- Year Established: Established in 2011 and with the current owner since 2015
- Location: Pinellas County, Florida
- Service Area: Pinellas County, Florida
- Client Mix: 70% repeat clients; 30% new clients
- Services: Daycare, boarding, dog walking, grooming, and much more!
- Lease: 5,550 sq./ft. for $5,400/mo.
- Capacity: Daycare max: 65-70 dogs/day; average 55-60/day (Note that this is the owners’ determination, not a licensing requirement); lodging is seasonal, which an average of 8-10 clients most days.
- Reason for Selling: Retirement planning
- Employees: 10: 1 full-time groomer; 4 full-time dog-handlers; 3 part-time support roles (such as cleaning, feeding, etc.); 2 part-time customer service assts.
- Seller Training Period: 90 days transition
- Growth Opportunities: Increase grooming services (currently generating $6,000/mo. in income); expand marketing (currently word of mouth)
- Current Owner’s Responsibilities: Both are customer service oriented
Financial Highlights
- List Price: $768,000
- Gross Sales:
- 2017: $531,211
- 2016: $370,321
- Cash Flow:
- 2017: $205,100
- 2016: $109,732
- Assets Included in Purchase*
- Equipment: $35,000: All equipment necessary to run operations including dog runs, bowls, toys, fencing, leashes, etc.
- Inventory: $5,000
- Intangible Assets: Active Facebook presence; veterinarian referrals; highly visible location, unique approach, friendly and knowledgeable staff
*amounts may vary
Cash Flow Analysis
| Description of Financial Statement | Tax Return | Notes |
| 2017 | ||
| GROSS SALES | $531,211 | |
| Net Income Shown on Financial Statement | $152,211 | |
| ADDBACKS | ||
| Compensation to Owner | $26,500 | |
| 11% Tax on total W2 Salaries | $2,947 | |
| Depreciation | $19,842 | |
| Non-Business Telephone | $3,600 | $300/month for personal lines |
| TOTAL ADDBACKS | $52,889 | |
| Seller's Cash Flow = Total Addbacks + Net Income | $205,100 | |
| Profit Margin | 38.61 % |
- 39% profit margin!
Services
Services for dogs from extra-large to extra-small!
- Daycare
- Boarding
- Dog walking
- Grooming
- And much more!
Specific information regarding services is available upon the receipt of a signed Non-Disclosure Agreement.
Employees
10 employees
- Groomer
- 1 full-time
- Dog-handlers
- 4 full-time
- Support staff
- Duties such as cleaning, feeding, etc.
- 3 part-time
- Customer service assistants
- 2 part-time
Growth Opportunities
- Increase grooming services
- Currently grooming is generating $6,000/mo. in income, but this could be increased significantly.
- Expand marketing plan
- Currently most customers find this superior care center by word of mouth
- Increase capacity
- Add additional ancillary services such as dog training classes or services, agility training, cat boarding, house sitting, maternity boarding specials, etc.
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 3.75. With this information, the computation is as follows:
$205,100 x 3.75 = $769,125
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 $91,029, which results in a 119% 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 1.8.
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