Possibly selling business - Advice required

[Andrew]

It will be extremely hard to get anywhere near the value out of the business compared to what time you have invested. You yourself are such a key part of the business with the knowledge you have and that is where trying to sell on falls down. Coupled with everyone believes it only takes 2 minutes to get a website going and other online presences and then place very little value on what might be on offer. A bolt on for someone is your best bet but it is such a small industry. I am in the process of structuring my own Company so that in a few years it is more viable to move on. I will be able to remove myself fully and all still carries on and similar level trade customers only rather than fragmented customer base that I currently have. I did just actually buy out another company and price was so low for what I got it was crazy. It is very hard to get any real value in this sector.

Different industries work on multipliers against profits. Sublimation and related printing will be very low and you will be lucky to get 2 years nett profit...... and this is profit after you take out your own wages and costs etc. This is why people often say you are just buying a job as it is hard to stack up any decent profits after all costs. You might get better luck structuring a buyout and do it over 2 or 3 years. Could have an upfront sum against second hand value of equipment and then monthly payments which might be on a sliding scale against your sales channels.

[Justin]

Some great points Andrew thank you, especially agree with the 'buying a job' part

It's a very difficult decision, I really don't want to leave the industry or give up on the dream. Like I say, not looking at selling because it's failing, quite the opposite, things look fine. I need them to look better than fine though. I did wonder about trying to buy another company or another bolt on that would see me busy in another area perhaps.

I also thought about the structured buyout and how this might work.

[logobear]

It is a lifestyle business for many folk .... and it can be a good, fun, challenging lifestyle ......

Can you share some rough numbers .....

Running a cafe is one of the easiest entry businesses .... and they can be sold .... but generally with a minimum of 2k per week turnover ..... otherwise, easier to just start a new one.

Do you have any staff ? - maybe you can give them a share of your biz, - and take a salary while they run it for you ....

[Justin]

We've had a few offers for equipment and the shops/website seperatley but would prefer to sell as a full going concern.

I had a meeting with a potential buyer last night and have 2 more meetings scheduled for the weekend. Early days but signs are promising. Advertised on local sites and got swamped pretty quickly, I appreciate all won't be interested but 3 serious enquiries was great to see and I spent a long evening discussing with them all.

Equipment alone is worth £25k if sold on cheaply for a quick sale, add in the stock, website, Etsy & NOTHS shops, huge catalogue of proven designs, designer/artist agreements and regular trade customers it starts to add up.

Just working out a concrete price which isn't easy.

[logobear]

Justin,
you are selling your business.
Folk recon that it is easy to get into, - but we all know that it remains easy to make mistakes - even after years of practice.
Regarding equipement ... buy cheap, - probably give up !
Buy wisely, - still cock up, but get better each time.


You need to factor in how you value your lifetimes creation.... and how much you care about future success.

If a complete tosser offered more money than a nice person .....
How much hand holding does the buyer want, - or you want to give in support ?.

Previous post, 25k in kit, plus stock, designs, websites, shops etc ....
AND ability to turn profit from day 1 means should be worth 50k or more.

The skillset to run a personalisation business should not be underestimated .... thou school leavers have much better digital skills now that 10 or 20 ... or 30 years ago.
There is a HIGH amount to learn .... and remember .... and differs if cotton / poly / triblend , supplied in RGB / cmyk
and all the different transfere media, with different heats, times, pressures.

Just vinyl .... so many different types, rules for pressing, - different blade pressures .....and where to buy which media from, which type, from who .....

And software ...
raster or vector ...
DPI, sizing, colour profiles, gamut, colour space, file formats

You are selling an enormously complex business.
Do you want a quick sell, most money, or best chance of future business success.


I think its more about finding the right buyer than the right price !

Good luck, and PLEASE keep us updated.

[Justin]

Thank you for the support and kinds words Phil, much appreciated

We received an offer for the full business, ongoing concern last week. Unfortunately this offer wasn't what we'd expected.

We now have a full valuation on the complete business which makes things a little easier. I have 2 more people very interested in taking it over which would still be ideal.

I haven't ruled out breaking the business into sections and selling that way as we've had enquiries for the online business etc. I don't really have the time to do this but if needs must will do.

It's not until you look at doing this you start to really see the value of your business. Years worth of positive feedback with online shops, reputation and so on.

[Justin]

So again we got someone interested in buying as a going concern, this time at an amount we'd have been happy to accept....but he failed to raise the finance

I'm trying to get as much of this tied up before the end of the wek as I'm moving on and will be very busy elsewhere. I may have to mothball the office and sell equipment as and when. i'd really hoped to avoid splitting everything up but needs must....everything has to go! lol.

I'll be putting ads up in the For Sale section hopefully today. I know our equipment will sell quickly. We still have the Latext 115 Print & Cut and are prepared to take a good offer on this so we can move forward and stop paying the lease.

The biggest issues is our Giant Sparrows Ltd. company. We have a good ongoing business both trade and public and would like to see this carry on. This is where most of value of the business really lies. Trade customers, Etsy, NOTHS, website, design catalogue and designer/artist contract etc. etc.

[logobear]

Justin,
it is a shame you are in such a rush .....
IMHO - it would take a good year to sell & hand over a business such as ours .....

Regarding Giant Sparrows Ltd. company.
It is not impossible that a forum member will be interested, - so share some links and numbers .....
What have you got to loose?
P

[Justin]

Yes, it's far from ideal and I would have preferred to be able to take my time.

The new opportunity I have has come around quicker than expected and I have to grab it with both hands.

I started this thread out of interest, I didn't expect to get anyone so interested as quickly as they were. We still have an offer on the table and another potential buyer.

I need to ensure the continuity of the online business and do have a plan if I have to keep this going. If none of the current interested parties comes through I'll gladly go into more detail for folk on here.

[Justin]

Ok, looks like we're splitting the business up. I've listed equipment and business below in greater detail. We have offers on some of the equipment, a
As stated my main concern is that the online business continues so I'm outlining underneath what we have.

EQUIPMENT

* Latex 115 54” Printer & HP 54” Cutter (New Smart Blades) with New PC/Flexi RIP
* Sublideck 3D Vacuum Presses x 2
* Additional 3D Vacuum Twin Press (2 Cases/Hairbrush)
* Jigs for above equipment x 76 and also Hairbrush Jigs
* Epson 1500W A3 Printers x 2 with Full CIS (Inktec) 6 Colour Sublimation (For printing film for 3D)
* HeatJet Evo 44” Rotary Press
* Epson F6300 4 Colour 44” Sublimation Printer (All new inks) Epson Edge RIP registered
* HP Z2100 44” 8 Colour Photographic Printer
* Graphtec CE6000-60 Cutter (New Smart Blades included)
* Canon iP8750 A3 Photographic Printer
* Blizzard Commercial Oven for printing mugs & 72 green wraps
* Adkins Studio mug press x 2
* Adkins Cap Press
* Pressmech Bag Press with multiple platens, polo, 6”, sleeve etc.
* 24” Auto Cold Laminator
* i7 PC, 32Gb RAM, SSD, 2 x 27” Monitors etc.
* Synology 12Gb NAS
* Additional new build PC used to run Epson RIPS
* Electric Cutters for material


STOCK

• Approx 1500 3D Sublimation Phone Cases, split between all iPhone models/Samsung Galaxy Glossy/Matte & Tough
• Approx 1200 TPU Cases primarily for UV printing etc. Models as above.
• Small amount of Hairbrush Stock
• Packets of A5 film media for 3D Printing.
• Material - Linen, Canvas, Velour rolls.
• Several boxes of 44” Sublimation Paper.
• Large stock of canvas bars.
• 2 Rolls of Canvas, assorted media for Latex/HP Z printers
• Sublimation/Photo Gift Stock to be priced
• Boxes of T-Shirts/Hoodies
• Boxes of Packaging