Services Sales And Maintenance Of Commercial Refrigeration Equipment For Sale

Business description

• Established 20 years
• Turnover £652,881 (2010)
• EBITDA averaging £146,500 per annum over the last 4 years
• Leasehold £350, 000 + Shareholders Funds
• Reference: 9782 DA

BUSINESS SUMMARY

This consistently successful company has developed an excellent reputation in the supply and maintenance of commercial refrigeration equipment. Trading from its base in an affluent London suburb, customers are generally located within the south east of England, and are mainly drawn from the hospitality industry. Good relationships with manufacturers and suppliers allow a very wide range of products to be sourced and supplied to specific customer requirements. Beyond this, the company’s core work relates to regular servicing and attending breakdown situations.

Our client has enjoyed a successful trading history spanning the last 20 years. During this period, the business has generated significant and consistent profits. The customer base is well spread and the business benefits from a stable, well qualified staff, with exceptionally low rates of turnover. In financial terms the balance sheet is very strong, with a consistently high EBITDA figure ensuring excellent earnings for a new buyer.

Over the last 10 years the company has both consolidated its place within the market place and developed a number of new customers. Overall, the market for commercial refrigeration products is inelastic with all equipment in situ requiring ongoing maintenance from time to time. In addition, restaurants and bars continue to open on a regular basis in the capital, ensuring a strong supply of new work.

The company would be an ideal purchase for a similarly sized or larger corporate with a good knowledge of the industry and with an acquisitive growth strategy. Such a purchase would give access to mature repeat customer base, a company with solid financials and a reliable staff compliment with a full management hierarchy in place. The business could also appeal to a rival firm, or alternatively, a company operating within the wider hospitality, maintenance or air conditioning industries, seeking additional market penetration and product range.

CLIENTS AND MARKETS

The success of the company has ensured a large and diverse customer base. The majority of clients trade within the hospitality industry, and include hotels, clubs, restaurants, bars and take-away establishments. Around 100 clients are billed on a monthly basis, with the expected seasonal trend seen within the industry. A number of clients are very prestigious and include some household names and include London clubs. There are approximately 30 maintenance contracts, some of which are large and include restaurant groups. Generally, customers occupy the SME sector of the market, but can be larger. In the past, clients have included morticians, and public sector work such as blood banks has been undertaken.

The market place is reasonably competitive with several dozen companies of a similar size operating within the south east of England. There are also a number of larger players within the market place. Overall, the market for commercial refrigeration products and services is set to grow; it is very much at the vanguard of economic activity and recovery. FGAS regulatory changes set to become law in July 2011, requiring companies within the
market place to fully comply. This is likely to see a number of smaller or less financially stable concerns exit the industry, ensuring an on going flow of work, and supporting solid financial margins

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DISCLAIMER: Viewing is essential to fully appreciate this business and strictly by appointment only through the agents. N/B: All Negotiations must be conducted through us. These details do not constitute part of an offer or contract and properties are offered subject to being sold, let or withdrawn without notice at any time and without liability for any expenses incurred by applicants. All statements and descriptions are made without responsibility or warranty by us, vendors or lessors. Intending purchasers must check for themselves (Misrepresentation Act 1967).

An Energy Performance Certificate will be made available upon request of further details where one is required for the business premises.

Business Operation

Expansion potential:

The company is located close to the very substantial London market. As such, it is ideally placed to exploit opportunities that will invariably arise over the next few years. Marketing at present is limited to the company website along with the production of a marketing flyer. The order book has always been full through recommendation and referral. Focus on business development activity generally would easily increase the company’s share of a sizeable market in the south east of the country.

Our client has concentrated on work within the commercial refrigeration sector. There would be considerable scope to develop a customer base within the industrial refrigeration sector. In addition, there would be an easy cross over into the air conditioning market.

The business could easily be extended beyond the confines on London and the south east, probably through taking on additional contract work initially.