Seller Financing Available
CO Mtns Largest Event Rental Co, 479K Adj EBITDA, Growing at 21%
CO Event Rental, Growing 21%, 479K Adj EBITDA, Great Management in Place
Colorado Mountains Largest Event Rental Business with 21% Growth and Recurring Revenue
The 2014 revenue was $1.43M which was 21% higher than 2013’s. The adjusted EBITDA for 2014 was $479K. Every month end the trailing 12 months adjusted EBITDA gets better for this business.
The market for their business is expected to continue to grow long term based on the increasing popularity of the mountain resorts and towns. These areas used to be mostly skiing and destination weddings. Now the numerous mountain towns compete weekly for tourists and locals hosting food, beer, and wine festivals, BBQ and Chile festivals, international sporting events, golf tournaments, trade shows, ski and snowboard competitions, biking and endurance competitions, conferences, artists shows, outdoor bands, plays, snow sculpture competitions, retail sidewalk sales, and parties, etc. The destination wedding market is still continuing to grow year around. During the summer fifteen years ago, a resort town may hold one event a weekend, now they may hold four or more in addition to the increasing number of weddings and parties. Plus, the mountains have continued to grow in popularity and population. The construction of new hotels in the mountains is at its highest rate ever which means more future growth. With this comes increasing amounts of events that are in need of tents and complete party rentals for their event. The Denver event rental companies focus on event planners while this company focuses not only event and wedding planners but also on the repeat events. Most events require a tent and a heater which are high margin rentals. They have the equipment, solid relationships, and a location to continue to grow.
The current value of its equipment and inventory is $1.4M which is made up of $1.1M in rental inventory and another $300K in supporting equipment. The value of their assets, client relationships, and earnings are the reasons that it makes no sense for anyone to start an event rental company from scratch and is a barrier to competition. There is very little competition in the mountains in general because of the expense and scarcity of warehouse space.
They have many well-known and long-standing customers from a diversified customer base that send them business every single year creating a strong base of recurring revenue. They have the largest inventory in the mountains especially for tents including many one of a kind items that make them the best choice to supply many of the events that take place every weekend in the mountains.
This business is well positioned to continue its growth. They have a great model, staff, equipment, location, relationships, and reputation. The future growth of this business is very predictable long term.
Location: Central Colorado Mountains
The non-disclosure agreement link is: http://companybroker.com/buyer-profile-jeff.htm If it is blue you should be able to click on it, if not please cut and paste that to a URL line(browser) and it will give you the NDA. Please fill it out and send it back to automatically request the Full Sales Package containing a detailed data room with financials and a Comprehensive Video on the entire operation and a full interview with the owner by clicking on the secure web link to the Confidentiality Agreement (CA). If you have any questions or comments on the CA please email me at email@example.com. Thank you.
The sales price is $2.8M. The owner will be keeping his cash, AR, and will pay off all debts including the AP transferring the business debt free. The owner would like a $2M down payment at the closing on the $2.8M total sales price. There is a scarcity of large business in the mountains especially ones with a location that is in the middle of the mountains with big upside potential and a reasonable lease. Big business in the mountains have a natural barrier to competition and sell for multiples above what you would normally find. In addition, this business has a 33% net profit margin which means that new growth will be very profitable to the new owner.
Brief Overview and Deal Points:
Please view the video walk through in the data room link in the sales package
to appreciate the quality and amount of their equipment and inventory. Keep in mind that the $1.4MM in equipment and inventory is valued at half of what it cost new. They have over $2.7MM in original cost that would make this business impossible to start from scratch. They have a very large quantity of high quality rental items including event tents and canvas that are the most valuable pieces of any event rental companies inventory. They use the top end lines of Anchor including Century, Navi-Trac frame tent system which helps to set them apart and they last for a long time. All outside mountain events need tents for either keeping warm in the spring, fall, and winter and to protect against the changing elements all year round. Even if the weather turns out fine and a tent is not needed. Events are required to put down a 50% non-refundable deposit unless it is canceled 180 days from the event to reserve a tent in case it is needed (they won’t know the weather will be good enough to not need a tent 180 days out). They make a lot of money off of tents, heaters, and flooring for tents being in the mountains. It is a very high markup and this is why their profit margins are much higher than the front range event rental companies. This business made $479K on $1.42M in revenue which is another reason that it is so valuable. That is a 33% bottom line. High margin companies and industries carry higher multiples because you make more money off of every new dollar of future growth.
They have many letters from happy customers and people that refer them business. They have a perfect reputation and have an A+ rating with the BBB. The seller will agree to full reps and warranties to a solid legal and business standing. They have less than a 1% default rate partially because they have most customers pre-pay for their rentals. They also charge a 9.5% surcharge which is required on all rentals which is intended to protect them from breakage and help keep the inventory refreshed. They also get 50% down on all rentals and get the other 50% ten days before a job is due to start. All deposits are only refundable if the reservation is canceled 180 days in advance.
The owner is selling because he is hands on and wants to spend more time with his family including travel. He will sign a non-compete. He will help in the transition the business and stay on for as long as the new owner would like him to.
They are full service with a full line of products from the very highest end to the low end and everything in between. They also triple check all orders before they are delivered to a client. You will see the equipment that they have and the inventory they provide in the video walk through of the facility. They put an emphasis in maintaining the rental equipment. Great care and attention is given to each piece of inventory and equipment after it is returned from a rental. He has learned that the better your equipment looks and works, the better their customers treat it and the more likely they are to recommend them and come back.
The business will transfer debt free with all liabilities on the balance sheet paid at or before the closing. The seller will be keeping the collectable accounts receivables and cash.
They have 4 salaried and commissioned managers excluding the owner and between 24 and 7 crew depending on the time of year that are paid hourly. The staff has proven to be trustworthy, competent, and reliable employees. His General Manager/Head Salesman has tried to buy the company and will consider buying in if a new owner will consider it. He is very capable, can run the business by himself, and big believer in the future of this business. The owner trusts and likes him a lot.
The company is moving to a 7369 Sq. foot facility in early-June that is located on .87 acres. It has ample parking, a spacious showroom, customer pick up area, reception area, private offices, conference room, ADA approved bathrooms, sprinkler system, truck bays, dish washing area, energy efficient lighting, and 2 apartments that can be used by the owner or given/rented to employees with a separate entrance than the business for both. The lease will be at a market rate for the area. The rent will be slightly higher but the apartments will come with it and should easily make up for the difference. The new location will also have room for growth, be more secure, more efficient, and allow for both employee and customer parking(the were spending $100 a month to pay for an offsite lot for their employees to park in before). Plus, they get to consolidate 3 separated storage facilities and the separate big tent storage facility into one location which will more than pay for itself in greater efficiency.
Growth and Expansion: The owner just added a fourth commission based sales person with the goal of reaching $1.8MM in revenue this year. This was also done to allow their top salesman to be able to go after more outside sales by knocking on doors in the resorts. He likes this and is very good at it. The current owner has focused on the area where they are located primarily. He is starting to grow into the Vail market which is the 2nd largest in the mountains. The new owner can add another outside sales person to focus on other resorts and towns within the same sphere. They have an advantage over the other event rental companies because of their size, location, and inventory. Also, the new owner should improve their online presence by spending money on search engine optimization and by adding landing pages for people searching for their services. They currently have only a single webpage that is not properly optimized.
Plus, Colorado is the best State in the country to own a business. Colorado was the #1 fastest growing and strongest economies in the United States, per Money.MSN.com and Business Insider. This article ranks all 50 states by eight economic measures including GDP growth, housing prices, job creation and exports.
Please Call of Email for Information: The broker is available at any time to discuss your interest in this offering and can set up a meeting either in person or by phone with the owner(s).
Thank you for your interest.
If you are NOT interested in this business for sale, but you refer someone to us who buys it and we collect the full commission, we will immediately pay you a referral fee of $5,000. Please send us anyone (or email this to anyone) who you think would be interested in this offering. Thank you.
Jeff Chapman Eisnaugle
Company Broker Group, LLC.
For 20 Years, We Sell Businesses "Quickly and Quietly"
999 18th St Ste 3000
Denver, CO 80216
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