Because the business owns all the intellectual property rights to their design, this company has an advantage over many others in the boat building industry. As a result, no one else receives any royalties from the company's work.
Key Feature Snapshot
? In spite of the Covid19 outbreak and the economic downturns, sales have been rising.
? The fact that the brand has been around for 30 years shows that it can adapt to changing economic conditions.
? Working capital is not a concern because all customers pay cash on delivery.
? With sales expected to eclipse the last year 2020/21 by 30% or $1 million plus for this financial year.
? An order book worth $7 million and ongoing quotations are driving a self-propelled sales growth.
? Currently, efforts are being made to broaden the reach of Eastern States.
? New Web Site just recently launched.
Key features over other businesses
High Gross Profit margin
Self-propelled sales and a high gross profit margin of 42 percent is indicative of a business that is both solid and in a strong growth phase.
Record year ahead
Sales are expected to grow by over 30 percent this financial year. Turnover will increase this current financial year to in excess of $4 million, purely through reputation and word of mouth.
Strong forward orders and historical ongoing growth - no matter what the state of the economy
The business has continued to record increases in sales and gross profits and the fact that the order book has already over $7million in sales means the business growth isn't dependent on external factors over which it has no control.
Western Australia Boating industry already setting records post-pandemic
Industry analysts IBISWorld predict that the boat building industry is set to experience over at least the next five years. Demand is high compared to the number of businesses' servicing the need.
Long established over 30 years
The company has been supplying boats to the Perth market for more than 30 years, and demand has grown steadily throughout that time despite minimal marketing efforts. There is a lot of interest in the company's name and the variety of boat names it offers.
No reliance on sales staff to generate sales
The vast majority of sales are simply self-propelled which means that the current owner does not have the overhead of running a sales force.
Low competition, high barriers to entry
Because its competitors have been around for a long time, the business has always had to contend with the same level of competition. Attempting to start a similar business from scratch would necessitate a significant investment of time and money.
Low advertising
The business is in the fortunate position it does not have any reliance on advertising to generate sales.
The owner can take holidays
All staff are cross-trained and supervisors manage each aspect of the construction process, so the owner can easily take holidays if desired.
Low trading hours
The business generally only operates from Monday to Friday, unless weekend overtime is required, in which case staff are generally able to work unsupervised.
Minor overheads
Given the size of the annual turnover, overheads are relatively small.
Progress payments mean low working capital
As a high-cash-flow enterprise, all clients make an initial deposit and then additional payments at various significant points in the construction process. As a result, the company's working capital is kept to a minimum.
Profits can be proven
The business has a complete set of verified accounts that clearly show its profitability.
High asset mix in the purchase price
A high percentage of the purchase price is made up of tangible stock and equipment. Compared to low asset businesses.
No bad debts
During the vendor's ownership, there have no bad debts.
Immediate potential to expand the business
The new owner will have no shortage of options for expanding this business, both locally and interstate.
As a result of the vendor's belief that their product (boat) is superior to their rivals, they believe their management style and customer-focused approach make it superior to the competition.
The business builds "forever boats" that its customers dream about. He also believes it has greater expansion potential because it can easily build on its excellent reputation for service, quality and delivery to seize the opportunity to scale up this business.
Sales: $4,028,668
Gross Profit: $1,621,786
Adjusted Net Profit: $1,070,000
Plant & Equipment: $315,000
Stock: $500,000
Price: $3,100,000
This SYSTEMATIC PROCESS OF OPERATION requires the love of BOATS and some manufacturing experience would assist As the current owner will provide all the assistance and training required for a new owner to take over.
Excellent barriers to entry exist to prevent any new competitors entering the market at any serious level with this business
There is no doubt about it Businesses simply don't operate in a better environment than this!
To make an informed decision please call Pat Keenan-Smith on 0413 626 633
