Importer of Outdoor Furniture with Rapid Growth Business For Sale

Business description

The business operates in the ever growing outdoor and leisure sector. It was established by the current owner in 2000 and has grown rapidly to achieve over $600 000 sales in the financial year ended in June 2007.

Teak outdoor furniture is imported and sold through, retailers, and commercial outlets such as architects and aged care facilities.

The solid teak is harvested from government monitored plantations and all furniture is manufactured from genuine teak. Only the finest and most weather resistant grain woods are selected and individually kiln dried to prevent warping or splitting. Stringent quality control ensures the best and safest products on the market, but has also built a reputation for manufacturing of the highest quality of low maintenance teak garden furniture.

The business has grown by virtue of its reputation for efficient service, modern design and by interpreting customer requirements into new product. Virtually no marketing activity is conducted because the business has grown so rapidly over the last few years. There is therefore major scope for future growth within its present market and also for geographic growth as the business is not represented at all in New South Wales, Western Australia, Tasmania or country Victoria.

Operations

All product is imported from approximately six suppliers who supply exclusively to the company. No formal contracts exist but suppliers stick to the exclusivity arrangements for fear of losing the business. Continuity of supply will not be a problem and the vendors will introduce the purchaser to all suppliers.

The suppliers are a valuable source of new product design ideas based on their trade with other international customers, principally in Europe.

The business works a five day week from 8 a.m. to 4 p.m.

Orders are received, mainly by fax, made up and despatched from the warehouse.

Orders are also received from commission agents operating in South Australia and Queensland.


Product/Service

In addition to traditional folding chairs, dining chairs, bar settings, benches, tables, loungers and accessories, two new ranges of commercial grade outdoor furniture have recently been introduced. This includes a contemporary marine grade, stainless steel and teak combination and a range of woven outdoor synthetic rattan furniture. The European engineered products has a built in, high grade UV protectant to enable it to withstand extreme weather conditions.

Managemenet/Staff

The business is currently run by the owner and one and one full time casual employee who does the deliveries and helps out with assembly, when this is required. Additional casual employees are used from time to time to assist with the unloading of containers.

A generous hand over period, including an introduction to the suppliers will be granted to the successful purchaser.


Market / Customer:
There are three distinct customer groups:

o Retail direct to the public.
o Sales to retailers, mainly furniture outlets and nurseries, for resale to the public. Sales to nurseries has grown strongly recently as they attempt to compensate for declining plant sales owing to the water restrictions.
o Sales to commercial customers such as architects, pubs, hotels and aged care facilities. These customers usually place large orders and frequently order full container loads. When this happens, 50% of the price is paid on placement of the order and the rest on arrival of the goods.

Normal terms of payment are C.O.D. or seven days from delivery for regular customers. Fist time customers pay for their orders prior to delivery.

The customer data base is reasonably well spread with no single customer being too dominant.

While there are competitors in the market place, one of the main rivals has recently stopped importing and has become a customer. The company is able to cope with the competition without reducing profit margins. In fact, sales of “B” grade merchandise virtually have no competition at current price levels.

Premises:

The business operates from premises of approximately 530 square metres which are owned by the vendor. The successful purchaser will have the option to lease the premises at a rental of $1100 per week (plus outgoings) or to re-locate the business operations. The existing site has great visibility from the very busy arterial road on which it is situated and this has lead to a growth in retail sales. There is on site parking, roller shutter access to the warehouse and a container unloading area. The sale price includes a fork lift Crown Walkie Stacker.

In addition to the warehouse there is

o a large showroom
o 4 furnished offices
o Kitchen
o 2 Toilets.

Plant/Equipment / Fittings:
A full list of equipment included in the sale will be provided.

Property information

Real Estate:

Lease

Lease terms:

Lease to be negotiated with Vendor if required.

Other information

Expansion potential:

Massive

Competition / Market:

Not intense. Demand is driving rapid growth and the growth can be improved with little additional recources.

Support & training:

A generous hand over period including introduction to suppliers will be granted.

Reasons for selling:

Life style

Trading hours:

Normal 5 day week

Inventory / Stock value:

$140,000