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Well-Established Lock, Key & Safe Business – Retail & Service

Consistent Average above $800K Sales with Healthy 30%+ Profit Margin in 2021

Specifications

 Price:
$825,000
Revenue:
$832,775 (2021)
Cash Flow:
$274,690 (2021)
Location:
Silicon Valley
Service Area:
San Francisco Bay Area
 Profit Margin:
30%
 Employees:
4 Full Time Employees
Reason for Sale:
The Sellers are Retiring
Goodwill: 50+ years, great reputation, 4.9 star reviews
Year Established:  1970
Products
&
Services: 
Retail sales – Lock/key/safe and wide range of corollary products
Installation – Locks/safes and related products
Services – Re-Keying / auto keys / key duplication / lock and safe repair / more
Client Snapshot: Residential / Contractors / Commercial
Facility
& Lease: 
$4,166/mo + NNN, 5 yr assumable lease in place, negotiating for an additional 5 years
Lease payment includes water, sewage, and trash
Personnel:  4 FTE, currently hiring another FTE
Software:  QuickBooks Online, HPC Code Source 15, Google docs & sheets
License Requirements:  C-28 Lock and Security Equipment Contractor License, and locksmith license. Both are relatively easy to obtain

SBA Pre-Qualified!  With 50+ years of stability and growth in the Lock & Key/Safe industry, Company is widely known in its geographic center, and has a strong reputation of professional service, knowledge, and integrity.  Company’s large showroom is well stocked with inventory including over 60 safes, along with an extensive range of products that extend beyond lock & key, and into hardware as well. 

As a full-service installation and service company, the business has 4 fully stocked, company-branded vans.  Four full-time employees are working at the Company, primarily as outside service installers and other lock & safe related services. The customer base is well diversified, with clients comprised of retail/consumer, contractors, industrial and government agencies.

Company has been in the same retail location for 24 years, and enjoys a great relationship with the landlord.  Retail customers are very familiar with the store as a result; therefore, the Buyer will benefit from the long-term community awareness and resulting repeat business.

Value Proposition

  • 50+ Years Established Reputation
  • Revenue from retail and installation/service business
  • Broad range of locksmith related services
  • 30%+ Profit Margins on Revenues of $832,775
  • Strong repeat customer base
  • Over $300K of inventory included in purchase price
  • Over $164K of FF&E included in purchase price
  • 4 Service branded service vehicles included
  • Excellent reputation with 4.9 star rating on Google

Revenue Breakdown

Financial Highlights

  • Listing Price $825,000
  • 2021 TTM Cashflow $274,690
  • 2020 Cashflow $250,842
  • COVID dip recovery in 2021 over 2020
  • Significant growth opportunities
  • Inventory built into purchase price
  • Strong value in Furniture, Fixtures, Equipment
  • Clean books, limited adjustments to earnings

Cashflow Analysis

Asking Price

The asking price is determined using a cash flow methodology. Cash flow is the sum of net income from the business plus any non-cash expenses, non-recurring items and any seller’s personal expenses. A multi-factor multiplier is applied to the cash flow based on the condition of the business.

For this business, a three-year average cash flow is applied making the business price more favorable to the buyer. The multiplier applied in this case is 3.07

Funding Example

Purchase Price: $825,000

20% Buyer Down Payment

$165,000

Buyer’s Equity

80% Bank Loan

$660,000

10-Yearterm at a rate of 6% = Monthly loan payment of $7,327

  • Cash Flow (Weighted Average SDE over 3 years): $267,999
  • Annual Payment to Bank: $87,928
  • Net Profit (After Expenses and loan payment): $180,070

* Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available.

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