BUSINESS IS BOOMING - ESSENTIAL PRODUCTS, LIFESTYLE LOCATION

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NET PROFIT
$336,000 pa

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PRICE
$600,000

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STOCK
$380,000

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LOCATION
South West Regional

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REF NO
012467/21

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BROKER
Glenn McTaggart

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012467/21

Key Features

  • Profits already up 21% in 2022
  • Coastal lifestyle location
  • Widespread growing repeat client base
  • Long established over 35 years
  • Immediate potential to expand
  • Monopoly on large machinery in the town
  • High asset mix in the purchase price

ESSENTIAL SALES BUSINESS WITH A COASTAL LIFESTYLE

This ROCK SOLID BUSINESS is one of the Southwest’s leading suppliers of a mandatory replacement product for earthmoving equipment, trucks, tractors, four-wheel drives, passenger vehicles, and ATVs.

Fortunately, this business is the only outlet in Busselton servicing large equipment, farm machinery, and transport vehicles with customers from Harvey to Augusta and all places in between.

The continued population and industry increase forecast for the region stands the business in good stead for the future.

 

MORE ABOUT THIS BUSINESS

The business has continued to record increases in sales and gross profits from inception and on this basis the owner sees no reason why this trend will not continue. The continued growth in the South West region is forecast to continue which makes the business virtually recession proof.

The current owner have been looking towards retirement and have engaged minimal promotional activities to grow the business. The establishment of a website, marketing, social media presence and a digital booking platform will almost certainly attract new customers. The employment of an on-road salesperson would also inject a significant increase in sales.

While there are 2 other resellers in the Busselton area, THIS BUSINESS has limited competition in the truck and large equipment categories of their business. This provides a near monopoly for the supply of to the large equipment and transport industries.

Busselton is a coastal town with a great lifestyle and the major hub for surrounding districts. WA Planning Commission forecasts the South West regions population to reach 230,000 by 2026. Busselton is a major lifestyle city based on tourism, wine and food, creative and professional industries and events.

Currently more than 179,000 people are residents of the South West. By 2031 it is anticipated about 226,000 people will reside in the region - and it's little wonder why.

 

This essential replacement business is fortunate that unlike other resellers in the town the business enjoys a diverse customer base including, Earthmoving Equipment, Mining Equipment, Transport Industry, Tractors and Farm Equipment, Specialist Local Government Equipment, Passenger Vehicles, Four-wheel-drives, Motor Bikes & ATVs.

SALES AND PROFITS ARE ROCKETING UP

First-quarter sales 2022 $595,959 up 21.59% from the same period in 2021

ONLY 4 FULL-TIME STAFF

The business operates with the owner/manager and 3 full-time staff who are multi-skilled across most aspects of the business.

POPULATION AND INDUSTRY SET TO SKYROCKET 

The business deals in replacement safety products and therefore is a demand business, which is considered not only recession-proof but one for which sales are self-propelled without a sales force. You’ll sleep easy knowing the southwest has featured in the top five growing regions nationally every year since 2004/05 and is expected to grow to over 216,000 people by 2027 according to projections published by the Commonwealth Department of Health and Ageing.

LOW COMPETITION

While there are 2 other similar resellers in the Busselton area, this business has limited competition in the truck and large equipment categories of their business. This provides a near-monopoly for the supply of this essential product for the large equipment and transport industries.

BARRIERS TO MARKET ENTRY

Aside from the significant capital requirements to establish a business, a newcomer to the market hoping to compete with this business would face the following issues…

  • The high cost of specialist equipment for large trucks and equipment
  • Establishing supplier accounts may prove difficult
  • The cost of establishing suitable premises in a high-exposure location

LOW ADVERTISING

Currently, the business utilises regular television marketing to promote the business. It may be more cost-effective for a new owner to go down the digital marketing stream which would hit a larger target market.

 MONOPOLY IN THE MARKETPLACE

The business enjoys a monopoly in that it has suitable equipment to service large transport and earthmoving equipment and road trains.

FAVOURABLE  TRADING HOURS

The business generally only operates 5 ½ days a week, however, operating hours are flexible depending on customer demands and emergency requirements.

THIS BUSINESS COULD BE RUN UNDER MANAGEMENT

The current owner oversees management and operations. If the new owner employed the right person, the business could be run under management either part-time or full-time.

CURRENT YEAR TO DATE SALES ARE UP

With the expansion of development in the region, sales continue to increase across all sectors of the business.

Sales up 30% from 2020FY to 2021FY

First-quarter sales 2022 $595,959 up 21.59% from same period in 2021

CURRENT YEAR TO PROFIT IS UP

Profitability of the business from the 2020 FY to the 2021 FY is up nearly 30% and continues to rise on the back of increased activity in the region. The forecast for the 2021/2022 financial year is set to break through the $350,000 net profit barrier.

 ALL BUSINESS PROFITS CAN BE PROVEN

The business has a complete set of verified accounts that clearly show its profitability and any addbacks that apply.

PREFERRED SUPPLIER STATUS

The business has developed strong trading relationships with key suppliers over many years. Their BLUE CHIP suppliers have provided branding to the premises and are highly unlikely to duplicate that in the region.

 NO RELIANCE ON SALES STAFF TO GENERATE SALES

The vast majority of sales are simply self-propelled which means that the current owner does not have the overhead of running a sales force. However, it also puts the new owner in the enviable position of having at hand a means by which demand could almost certainly be increased if need be.

POPULATION AND INDUSTRY SET TO SKYROCKET

The business deals in replacement safety products and therefore a high-demand business.

This business is not only considered recession-proof but one in which sales are self-propelled without a dedicated sales force.

You’ll sleep easy knowing the southwest has featured in the top five growing regions nationally every year since 2004/05 and is expected to grow to over 216,000 people by 2027 according to projections published by the Commonwealth Department of Health and Ageing.

EXCELLENT PREMISES LOCATION

The location of the premises provides maximum exposure situated on a prime corner location in the industrial area of Busselton.

HIGH ASSET MIX IN THE PURCHASE PRICE

This business reflects a high percentage of the purchase price made up of tangible stock and equipment. Compared to low asset businesses, this business reflects a lower risk and potentially delivers a higher bottom line profit through being able to minimise its tax by claiming depreciation as a non-cash expenditure item on its long-life equipment.

INDUSTRY CONTINUES TO SKYROCKET IN THE REGION

Driven by a broad spectrum of automatic high-growth industries, this business can only continue to grow. While the business is constantly growing, it is capable of handling any further demand simply by adding additional non-skilled staff who have some trade skills.

Key Features

  • Profits already up 21% in 2022
  • Coastal lifestyle location
  • Widespread growing repeat client base
  • Long established over 35 years
  • Immediate potential to expand
  • Monopoly on large machinery in the town
  • High asset mix in the purchase price

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