Amish Furniture Store (SOLD) - NEO Business Advisors
CASE STUDY OF RECENT TRANSACTION

Amish Furniture Store (SOLD)

NEO Business Advisors represented the seller of an Amish Furniture Store and Showroom selling high-quality, hand-made, solid-wood Amish furniture for both indoors and outdoors. Indoor furniture includes furniture and accessories for bedrooms, living rooms, dining rooms, offices, entry ways and more. Outdoor furniture includes Adirondack chairs, swing sets, and sheds.

Asking Price:
$199,000
Gross Revenue:$632,331
EBITDA:N/A
FF&E$20,000
Cash Flow:
$97,178
Inventory:$60,000
Real Estate:$2,500/month
Established:2014
Amish Furniture Store for Sale Photo

This Business is SOLD!

Complete bedroom suits with bed frames, headboards, footboards, nightstands, dressers, and chests. Living room furniture includes sofas, chairs, entertainment centers, end tables and coffee tables. Dining room tables include the highest quality mechanisms for expandable tables with leaf inserts for additional seating, chairs, benches, and banquet tables. Office furniture includes solid wood desks, chairs, bookcases with rolling ladders and display cases with options for interior lighting and glass shelving. Outdoor furniture includes Adirondack chair and table sets for patios and porches, swing sets and playgrounds for kids, and sheds for outdoor storage.

Additional offerings include hardwood flooring and high-quality carpet. These and not currently being marketed heavily but are established distributor relationships that include a network of installers as an option the new owner can explore for growth and expansion.

All of the furniture is hand built by Amish craftsman to the highest quality standards. The products speak for themselves when customers enter the showroom and the quality craftsmanship has allowed the business to grow mostly through word of mouth marketing from satisfied and often repeat customers. The seller has built a network of over 80 Amish Suppliers and Craftsman that will transfer with the sale of the business. The business maintains a wide variety of product offerings and has comprehensive supplier catalogues, but the possibilities are endless with many suppliers offering custom designed furniture solutions. The owner has over 29 years of experience in the industry which they have brought to this business!

Revenue by Year:

2019 Revenue $ 632,331

2018 Revenue $ 749,502

Seller’s Discretionary Earnings (SDE) by Year:

2019 SDE $ 97,178

2018 SDE $ 103,155

2 Year Weighted Average SDE $ 99,569

Excellent profit margins of 15% in 2019 and 13.7% in 2018! These margins can be improved by a new owner as the current owner prices furniture at a 1.3-1.6x markup while competitors are pricing at a 1.8-2x markup on the same items. A combination of improved marketing efforts to attract more customers and a slight increase in the current markup to the level of his competitors will increase sales and greatly improve margins.

Furniture, Fixtures, and Equipment (FF&E) of $20,000 are included in the asking price. The business has a branded box truck as a delivery vehicle and office furniture including desk, chair, computer, shelving, and displays.

Inventory of $60,000 of furniture at cost is also included in the asking price and a reasonable and normal level of inventory for the business. This amount will be adjusted up or down for actual inventory level at the time of transfer.

Real Estate is leased by the seller. The real estate is owned by the seller’s brother who is aware the business is for sale and has agreed to offer a lease agreement to a new buyer at $2,500 / month for the 3,300 sq. ft. showroom facility. Fair Market Value (FMV) rent for a similar space is estimated at $3,500 / month.

Some Details of the Transaction Remain Confidential

Detailed Information

Location:

Cuyahoga County, OH

Inventory:

Included in asking price

Real Estate:

Leased

Building SF:

3,300

Lease Expiration:

N/A

Employees:

3

Furniture, Fixtures, & Equipment (FF&E):

Included in asking price

Facilities:

Real Estate is leased by the seller. The real estate is owned by the seller’s brother who is aware the business is for sale and has agreed to offer a lease agreement to a new buyer at $2,500 / month for the 3,300 sq. ft. showroom facility. Fair Market Value (FMV) rent for a similar space is estimated at $3,500 / month.

Competition:

Main competition is two other Amish Furniture stores both of which price significantly higher than the seller and have been established longer. As this company continues to grow it will be able to close the gap on product markup which will drastically improve profit margins. The area can support another large player in this space as the local competitor does 2-2.5x the revenue of the seller. The other competitor is Amish owned and operates out of a large three-story furniture showroom showing how big this business could grow in the area.

Growth & Expansion:

Improve marketing and sales efforts: current owner began this process with the design of a new website but does not do much marketing, SEO, pay-per-click advertising or online furniture sales. Marketing will be key to drive increased traffic to the brick and mortar store where customers can experience the quality of the hand-made, solid-wood Amish furniture. Sales can also be made online on the reputation for quality of Amish furniture and shipping can be established for distribution. Outsource Deliveries: current owner is involved in all deliveries to see the product is delivered and setup properly. This could be outsourced to a delivery company to allow the new owner to focus more on marketing and sales to grow the business. As the business grows this could be brought back in house will full-time delivery drivers to give the company more control over delivery schedules, setup and cost.

Support & Training:

Owner is including 4 weeks transition training included in the asking price.

Reason for Selling:

Owner is selling to retire.

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