Large Established Franchised Custom Closets Business
NCListing DetailsOffice ID: CLOSET2
Status: Offer Received
Listing Broker: Jeff Snell, CM&AP, M&AMI, LCBI, ABI
Listing Price: $1,400,000
Gross Revenue: $2,801,787
Cash Flow: $463,950
Inventory Included: Yes
FF&E Included: Yes
Sales Structure: Asset Sale
Seller Financing: Yes
Financing/Terms:Seller will provide up to 10% seller financing only if required by the SBA (which has not been a requirement since 12/2018).
Reason for Sale:Retirement
Training:Sellers will provide 80 hours of transition support at no additional cost.
OperationsYear Established: 2006
Form of Ownership: LLC
Employees (full-time): 25
Employees (part-time): 4
Business Hours: Showroom: M-F 9-5; Factory: M-F 7:30-4
Business Description:This popular franchised business has put COVID-19 policies and procedures in place to protect employees and clients. Customers can also choose between in-home, virtual and in-showroom appointments. This business offers clients a wide range of customized products and installation services (design/build) including custom closets, pantries, entertainment centers/media rooms, laundry and mudrooms, but also has solutions for home office, garages, wall-bed systems, as well as crafts/kids areas.
Historical Summary:The business was founded in 2006 and has experienced steady growth since inception. It is owned and operated by a husband and wife team. Initial franchise fee is $50,000. Renewal fee is $10,000. Transfer fee $10,000 (paid by Seller).
Owner Qualifications:Buyer will need to have general business skills including employee management, marketing, customer relations, general accounting. Carpentry, design, engineering or mechanical skills are a plus, but not required.
Competition:The business utilizes proprietary engineering techniques and in-depth salesperson training that result in a higher quality, longer lasting and more functional solution being delivered to the client. The result is happy customers who return for subsequent projects and refer their friends, family members and colleagues. Seemingly similar products are available from other "closet" companies and even big box retailers, but the overall fit/finish/functionality and quality are subpar and the overall offering of options is substantially smaller.
Potential Growth:In addition to the continued, annual growth of the Custom Home Organization market, this business also stands to increase sales as homeowners and businesses continue to adapt to working remotely with virtual meetings as a result of increased demand for optimized work spaces at home, home/offices and traditional work spaces. This business is well positioned to help potential clients become more efficient and organized in environments that are ergonomic and consistent with people’s desire to live and work in spaces that are welcoming, inviting and modern. Sustained population growth of the business area has helped bring a steady influx of new potential customers.
LocationType of Location: Commercial Center
Monthly Rent: $12,200
Square Footage: 12000
The business operates from a 12,000 square foot building owned by the business sellers. The building may be leased or purchased. The anticipated fair market value is $1,500,000 but will be sold at third party bank appraised value.
Royalty %: 6.75%
Franchise Transfer Fee: $10,000
--Paid By: Buyer
Last Updated: Apr 14, 2021 / 3:47 PM
Financial Information Current As Of: Sep 14, 2020 / 3:06 PM