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Light Industrial Staffing Company in Chicago

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CASH FLOW
$454,320

Specifications

  • Multiplier
    1.27

  • Location
    Chicago Area

  • Service Area
    Chicago area

  • Intangible Assets
    35+ year history, great reputation, and contacts

  • Price
    $575,000

  • Revenue
    $4,607,091

  • Down Payment
    15%

  • Industry
    Professional/Business/Financial

  • Employees
    6 Administrative (Manager, Payroll specialist, Sales, Staffing Coordinators – 2, On-site Supervisors – 1), 100+ Temporary Employees

This staffing company has decades of experience in the staffing industry.  Located in the Chicago area, this business is positioned for exponential growth.  With a specialty in providing thoroughly vetted temporary employees to local employers, this establishment prides itself on compliance and quality customer service.  

 

With a current focus on light industrial workers, this business also places employees in areas such as administrative, legal, IT, skilled labor, and accounting.  Well versed in the Government RFP bidding process and data reporting required to maintain such contracts, this is another revenue stream for a potential buyer.  Placing anywhere from 1-100+ employees for a single employer includes advertising for positions, accepting applications, interviewing for employer qualifications, placement, and payment of employees. 

 

This is a great opportunity to own a staffing company with great potential for growth.  A buyer with a strong background in staffing may find this business to be an excellent complement to their existing skills.  Or, if you are looking to expand by adding a staffing company location in the Chicago area this opportunity may be perfect for you!  

Business Highlights

  • Years in Business: 35+ years of experience
  • Location:   Chicago area
  • Service Area:   Chicago area
  • Clients:  Employers in the Chicago area
  • Services:   Staffing services
  • Lease:   2 offices
  • Reason for Selling:   Retirement
  • Employees:   6 administrative, 100+ temporary workers
  • Seller Training Period: 1-3 months
  • Growth Opportunities:  New employer relationships, government contracts, expand into new market
  • Current Owners’ Responsibilities:  Legal and Operations

Financial Highlights

  • List Price: $575,000
  • Gross Sales:
    • 2017: $4,607,091
  • Cash Flow:
    • 2017: $454,320
    • 2016: $379,016
  • Assets Included in Purchase*
    • Intangible Assets:   nearly 40-year history, great reputation, and contacts
    • o   Furniture and Fixtures:   $149,044
    • WIP:   3-4M in contracts going forward

*amounts may vary

Cash Flow Analysis

  • Potential $80,000 in savings can be found in acquiring a lower MOD rate. 

Clients

  • Small to large employers in the Chicago area
  • Local, State, and Federal Government placements
  • Temporary employees are placed in the following areas:
    • Light Industrial
    • Administrative
    • Accounting and Finance
    • Legal and IT
    • Skilled Labor

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

Services

  • Contract with employers to find workers in the following categories
    • Temporary
    • Temp-to-Hire
    • Direct Hire
    • On-Site Management
    • Candidate Skills Testing
  • Thoroughly vet employment candidates
  • Adhere to all hiring requirements as set by local, state, and federal rules

Employees

  • Manager
    • Responsible for overall operations, customer relations, and business development
    • Manage day-to-day operations
    • Oversee safety 
  • Payroll Specialist
    • Handles accounts payable and receivable
    • Payroll 
  • Sales Specialist
    • Focuses on building client relationships and forging new contact in the business community 
  • Staffing Coordinators - 2
    • Oversees the recruitment and search process
    • Screens applicants, interviews, administers pre-qualification testing
    • Runs background checks on applicants
    • Fills job orders for staffing in businesses 
  • On Site Staff at Distribution Center
    • Provides supervision and management
    • Responsible for communications with employer and staffing solutions company
    • In charge of timekeeping for temporary staff 
  • Temporary Employees – 100+
    • Placed in a variety of workplace settings

Growth Opportunities

  • Build relationships with employers in the area

 

  • Seek out government contracts through the RFP process

 

  • Expand into new markets in the area or state

 

  • Add this company to your existing staffing operations to expand service delivery

Profit Opportunities: Condense offices with no impact on cash flow

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 1.27.  With this information, the computation is as follows:

$454,320         x          1.27     =          $576,986

The Fair Market Value found above positions the business List Price at $575,000.

Funding Example

Purchase Price:                       $575,000

15% Buyer Down Payment:     $86,250

35% Seller Financing:             $201,250

50% Bank Loan:                      $287,500

Seller Financing 6-year term at a rate of 4% equals a monthly loan payment of $3,149.

Bank Loan 8-year term at a rate of 6% equals a monthly loan payment of $3,778.

After business expenses and loan payments, a buyer with a 15% down payment of $86,250 would retain a profit of $371,199, which results in a 430% 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 $575,000 with the terms listed above, the coverage ratio is 5.47. 

 

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. 

Click to download NDA form

Print, sign and send to:

210 N 78th St. 2nd Floor
Omaha, NE 68114

Or fax to:

f 402.939.0857

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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.