Exceptionally Equipped, Highly Reputable Bakery

High End Commercial Bakery with National Accounts & Retail Café

SB796 Blind High Point Summary Image 2022 06 24

Specifications

 Price:
$1,750,000
Revenue:
$3,583,597 with cafe
Cash Flow:
$491,307 with cafe
Location:
San Francisco County
Service Area:
SF Bay Area & West Coast
 Gross Margin:
32.8%
 Employees:
22 Full Time + 2 Owners
Reason for Sale:
The Sellers are Retiring
Goodwill: 32 Yr. Reputation, 5-Star Reviews
Year Established:  1989 by current owner
Services
Offered: 
Production of a large variety of hand-crafted European pastries and desserts in a range of sizes for hotels, catering, grocery and wholesale distributers and custom designed cakes
Equipment:  Very well-appointed production rooms, asset list provided upon request
Facility:  Sectioned 7780 sf production facility with high ceilings, includes offices, loading docks and attached cafe
Products
Offered: 
Bars, cakes, cookies, cupcakes, individual desserts, petit fours, roulades/terrines, sheet cakes, strips/strudels, tarts, custom-designed desserts, seasonal specials, & wedding cakes
Lease:  7,780 sf, current rent $14,905.80 a month, lease ends June 30, 2024, new lease will be written for qualified buyers
Personnel:  Total of 21 bakers/decorators, 1 office/bookkeeper and 2 full time owners, one as baker other as office manager

Value Proposition

  • 33 years Established 5 Star Reputation
  • Consistent and Exceptional Customer Reviews for both the bakery and café
  • Café run as separate business with full books and taxes
  • Priced to reflect the large asset base and systems
  • First quarter of 2022 showing strong recovery
  • All brochures, marketing and distribution channels complete
  • Buyer to Replace Retiring Sellers as Pastry Chef & Office/Sales
  • Excellent work flow layout to maximize production
  • Bakery primed with contracts to grow
  • HACCP Certified
SB796 Profit Margin Chart 2022 07 21

Revenue Breakdown

SB796 Revenue by Category Chart 2022 05 06
SB796 Cost Breakdown Chart 2022 05 06

Financial Highlights

  • Listing Price: $1,750,000 including Inventory
  • Sales and Costs noted are for the Bakery
  • 2019 Café Sales were $487,454, recovery is $223,163 2021
  • 5 delivery vans included in sale
  • Medical Insurance for staff is 4.2% of gross sales
  • Recommended Working Capital $50,000
  • Q1 2022 63% above Q1 2021
  • Bakery and Café realized PPP loans
  • Last product & services price increase: November 2021
  • Online ordering platform ready to roll out
  • Gross profit average is 73%
SB796 Sales Cash Flow Chart 2022 07 21

Cashflow Analysis

SB796 Financial Table 2022 07 21

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, as common method for valuing pandemic-affected businesses, a value is determined based on the latest, non-anomalous year. This method is the best practice to find the true value of the business following a trend of notable recovery. Though the business is recovering, the pace of recovery is slowed by the steady resurgence of the market for the business’ primary commercial clients.

The multiplier applied in this case is 3x, which is in line and comparable with recent sales of bakeries of this size and that there is a retail café (running at break even) whose sales and cost are not figured into these calculations.

SB796 Multiple Box 2022 05 06

Funding Example

Purchase Price: $1,750,000

20% Buyer Down Payment

$350,000

Buyer’s Equity

80% Bank Loan

$1,400,000

10-Year term at a rate of 5.75% = Monthly loan payment of $15,368

  • Cash Flow (SDE in 2019-20): $487,424
  • Annual Payment to Bank: $184,416
  • Net Profit (After Expenses and loan payment): $303,008
SB796 Return Box 2022 05 06
SB796 Coverage Ratio Box 2022 05 06

* 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.