Asking price: £150,000

Sales revenue: £318,575

Net profit: £95,559

Fixtures value: Undisclosed

Stock value: Undisclosed

Business description
HIGHLIGHTS:
• Unique opportunity to purchase a dynamic company with an excellent reputation
• Fantastic world wide growth potential via the internet
• Development of product range possible to increase revenue
• Loyal customer base with repeat trade

BUSINESS:
The company was established in the early 1990s by a high-profile BBC presenter and a top BBC recording engineer. Both keen choral singers, they were eager to fill a notable gap in the market by offering a solution to a number of intractable problems experienced by many choral societies in the UK and abroad. Society members often have difficulty reading music and therefore learning their parts – a process known as “note-bashing”. In addition, even when a part has been learned, practising before a rehearsal without musical support can be difficult and inconvenient, while at the rehearsal itself lack of singer confidence can slow down or disrupt a tight schedule.

A note-bashing learning tool – initially on cassette tape but nowadays predominantly on CD – was the obvious, convenient and economic answer. To avoid the problem of individual vocal interpretation (tempo, dynamics and pronunciation) conflicting with the conductor’s, the now familiar idea of using sampled instruments rather than the vagaries of the human voice was exploited from day one. Made to the highest professional standards, ChoraLineTM today covers the main repertoire of the choral societies, with separate recordings for each individual voice part, of which there can be as many as 8 for some compositions. ChoraLineTM works are “evergreens” and will need no further development for the foreseeable future.

ChoraLineTM was soon in demand, turning Music Dynamics from a part-time venture into a niche market mail order company. Since its launch the company has enjoyed unfaltering growth backed by an ever-expanding range of choral works both sold and hired to choirs and individual singers.

The company has also successfully branched out into areas associated with ChoraLineTM, its key product:
• Vocal scores
• Performance CDs of all the standard choral works
• Personal choir folders in a selection of colours
• Gift certificates.

All products are sold via the company’s e-commerce website, as well as by phone, email or fax. This is a reflection of the company’s policy of always trying to make sure the customer experience leaves nothing to be desired. An across-the-board insistence on quality and efficiency is also the reason for producing ChoraLineTM CDs and cassettes in-house by using the company’s own production facilities. Furthermore, these facilities make it possible to offer a popular short-run duplication service.

Another ancillary service that has found a natural home at Music Dynamics is the telephone booking agency for major choral music performances at the Royal Albert Hall organised by the internationally-recognised Concerts from Scratch.

Music Dynamics is an independent limited company under its original ownership.

PURCHASER PROFILE:
The ideal purchaser would probably wish to work within the company and draw a regular salary (the company’s finances are structured to accommodate this). He or she would preferably have knowledge of classical music, especially choral music, though this is not essential.

TRADE:
Year ending 31/12/08:
Turnover £318,575
Gross Profit £190,213
Adjusted Net Profit £95,559

The nature of the business leaves it largely unaffected by the current recession.
Please note that if a business is VAT registered, all figures exclude VAT.

STAFF:
The company is managed on a day-to-day basis by one shareholder. The other two shareholders supply their services (voice-over and graphic design) on a contract basis. The company employs three people full-time (including the manager), backed up by two job-share part-timers.

REASON FOR SALE:
Having developed this business successfully over the past 12 years, our client wishes to retire. However, he is prepared to remain in the business on a contract or part-time basis to help with the handover and with new product development and production.

HOURS:
The company is staffed during office hours, Monday to Friday, 9.00am to 6.00pm.

BUSINESS PREMISES:
The company’s two adjoining business units contain areas for administration, production, packaging, stock storage and staff facilities. There is ample parking.

BUSINESS SOURCE/CLIENTS:
ChoraLineTM is the leading brand in the UK, where the company’s sales predominate, although expanding overseas sales suggest it is increasingly well-known further afield. Sales, of which approximately 30% are accounted for by the Music Dynamics website, have been growing on average by at least 12% per annum. A major part of the business is repeat and referral from a current database of 15000 customers.

TRADEMARK:
The trademark ChoraLineTM is owned by Music Dynamics Limited. Copyright of the brand could be purchased with the business – or not, as mutually agreed.

TECHNOLOGY, SYSTEMS & IT:
The company’s progress and success has been driven since inception by exploiting leading-edge information technology and software. It uses a bespoke, highly efficient electronic business system to meet its unique combination of daily product and service requirements, including its own independent e-commerce website, orders by telephone and post, as well as stock control and accounts.

SCOPE AND DEVELOPMENT:
The company believes and has fully recognised that the business’s size, turnover and profits could be significantly increased through the following:
- Organic growth using the existing customer base and referrals. Although this is a niche market, there are over 2000 choirs in the UK, representing at least 120,000 singers, of which Music Dynamics currently serves 15,000 (outside the UK the market is measured in the many millions).
- Expanding the product range
- Expansion into other genres
- Selling products from associated industries on a commission basis
- Proactive sales and marketing (customer mail/e-shots)
- Downloading music direct to the customer. The company sees this as easily holding the most promise. Material costs and postage would be sharply reduced, driving up profit margins. In addition, in conjunction with its website, it would make worldwide sales much easier and quicker, an opportunity of special importance given that the universality of the company’s products and this wider market - counted in the millions - are made for each other. Development work in this field has already been undertaken and the company continues to invest to maintain momentum and bring downloading to fruition as soon as possible.

Current developments include a Christmas gift catalogue, first tried experimentally – and successfully – in 2008. The new Music Dynamics website – with downloading capacity – also continues to be developed and has been fully costed and budgeted for.

TENURE:
Our client advises us that the property is Leasehold.
Original lease: 1 year
Remaining: 1 year
Rent: £4800pa
Rates: £1,820pa

LEGAL FEES:
Vendor and Buyer each to meet their own legal costs.

LOCAL AUTHORITY:
Cheltenham Borough Council

SERVICES:
We understand from the vendor that all main services are connected to the property.

GUIDE PRICE:
The vendor invites offers against an asking price of £150,000 for the leasehold, business goodwill, equipment, fixtures and fittings, subject to inventory plus stock at valuation.

VALUE OF STOCK:
A modest stock of cleaning materials and supplies and other consumables is maintained which will be available for purchase at valuation at completion.

SELLERS REFERENCE: WW0274

Property: Leasehold