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Indoor & Outdoor Omaha Sign Shop Since 1991

CASH FLOW
$155,163

Specifications

  • Price
    $265,000

  • Revenue
    $464,292

  • Profit Margin
    36%

  • Location
    Omaha, NE

  • Service Area
    Omaha (80%) within 100-mile radius (20%)

  • Equipment
    $150,000

  • Reason for Sale
    Retirement

  • Employees
    3; Foreman (1), Part-time staff as needed (2)

  • Intangible Assets
    Diverse client base, reputation for accomplishing unique and complex projects, excellent customer service

With $150K in assets, this full-service sign shop has a skill set for mastering complex projects. This company is equipped with vinyl cutters, inkjet and thermal printers, and a computerized router that will cut up to 2” thick plexiglass. Projects include high-quality signs and banners, electronic message centers, vehicle graphics, sign makeovers, and interior signage. The customer base is very diversified, and business is not reliant on any one contract. Projects range from replacement to creation and any request in between.

The company leases an 1,800-sq. ft space with an open area and front desk for $1400/month. Room dividers are in place to house the specialized equipment relevant to this business. A full-time foreman with over a decade of experience handles all the office needs including sales. Two part-time employees assist when needed.

Outfitted with a strong name and industry recognition, a strategic buyer could step in and work toward getting additional regional and national work. With diverse clientele and referrals from competitors, this company’s reputation has paved the way for growth.

 

Business Highlights

  • Year Established: 1991
  • Location: Omaha, NE
  • Service Area: Omaha (80%) within 100-mile radius (20%)
  • Services: high-quality signs and banners, electronic message centers, vehicle graphics, sign makeovers, interior signage
  • Lease: 1800 sq. ft. month-to-month at $1400/month
  • Reason for Selling: Retirement
  • Employees: 3; Foreman (1), Part-time staff as needed (2)
  • Hours: Monday-Friday 8:30am-5pm
  • Seller Training Period: 3-6 months
  • Growth Opportunities: More regional and national work
  • Current Owner’s Responsibilities:Owner/operator

Financial Highlights

  • List Price: $265,000
  • Gross Sales:
    • 2018: $464,292 Annualized
    • 2017: $278,661
    • 2016: $309,990
    • 2015: $295,892
  • Cash Flow:
    • 2018: $155,163 Annualized
    • 2017: $86,076
    • 2016: $102,502
    • 2015: $86,117
  • Assets Included in Purchase*: $150,000
    • Equipment: Computerized router, vinyl cutter, Large inkjet printer, panel saw, thermal printers
    • Intangible Assets: Diverse client base, reputation for accomplishing unique and complex projects, excellent customer service.

*amounts may vary

Cash Flow Analysis

Description of Financial StatementP&L Statement
Jan - Sept
Tax ReturnTax ReturnTax ReturnTax ReturnNotes
20182017201620152014
GROSS SALES$348,219$278,661$309,990$295,892$246,984
Annualized$464,292
Net Income Shown on Financial Statement$85,182$51,430$56,938$52,199$46,688
ADDBACKS
Compensation to Owner$20,000$20,000$30,000$20,000$20,000
11% Tax on total W2 Salaries$2,200$2,200$3,300$2,200$2,200
Contributions/Donations$527$0$0$0$0
Non-Business Telephone$1,350$1,800$1,800$1,800$1,800$150/month
Life Insurance$414$552$552$552$552$46/month
Health Insurance$5,073$6,764$7,104$7,104$7,104Personal expense
Auto-Personal Use$1,626$3,330$2,808$2,262$1,92850% is personal
TOTAL ADDBACKS$31,190$34,646$45,564$33,918$33,584
Seller's Cash Flow = Total Addbacks + Net Income$116,372$86,076$102,502$86,117$80,272
Annualized$116,372
Profit Margin33.42 %30.89 %33.07 %29.10 %32.50 %

Profit margin 2017: 31%

Typical Clients

  • Property Management Companies
  • Commercial Construction/Renovation

Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.

Services

  • High-Quality Signs and Banners
  • Electronic Message Centers
  • Vehicle Graphics
  • Sign Makeovers
  • Interior Signage

Employees

  • Foreman (1)
    • 17 years of experience, works in the office and assists with sales
  • Part Time Staff (2)
    • As needed

Growth Opportunities

  • More regional and national work
  • Increase online sales capability 
  • Increase marketing and advertising

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 3-year average cash flow was used with a prescribed multiple is 2.9.  With this information, the computation is as follows:

$91,565           x          2.9       =          $265,539

The fair market value found above positions the business list price at $265,000.

Funding Example

Purchase Price:                        $265,000

15% Buyer Down Payment:      $39,750

15% Seller Financing:               $39,750

70% Bank Loan:                      $185,500

Seller financing 5-year term at a rate of 4.50% equals a monthly loan payment of $741.

Bank loan 8-year term at a rate of 6% equals a monthly loan payment of $2,438.

After business expenses and loan payments, a buyer with a 15% down payment of $39,750 would retain a profit of $53,419, which results in a 134% 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 $265,000 with the terms listed above, the coverage ratio is 2.40. 

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. 

 

Purchase Price:

$265,000

$
%
OR
$
%
OR
$
Years
%

Bank Loan Needed: $

Years
%
$
$
$
$
$

Funding Details

Business:

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: $

Loan Payments

Monthly Payment to Bank: $
Yearly Payment to Bank: $
Monthly Payment to Seller: $
Yearly Payment to Seller: $
Total Monthly Debt Service: $
Total Yearly Debt Service: $

Conclusions

Fixed Charge Coverage Ratio

The bank will require a minimum ratio of 1.5 to be lendable.

Cash Flow:
3 year average
$
Annual Debt Service: $
RATIO:

Buyer's Net Operating Income (NOI)

The amount of money the Buyer will retain as profit.

Cash Flow:
3 year average
$
Annual Debt Service: -$
NOI:

Buyer's Return on Investment (ROI)

The rate of return on the Buyer's down payment.

Down Payment: $
NOI:
ROI: %

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210 N 78th St. 2nd Floor
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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.