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BUSINESS REFERENCE : IA017 / RightBiz IA017-SOUTHERN HOME COUNTIES-£630,000-WELL-ESTABLISHED & PROFITABLE MANUFACTURER OF PRODUCTS & EQUIPMENT FOR THE PROCESS INDUSTRIES | | | | | | Well-Established & Profitable Manufacturer of Products & Equipment for the Process Industries Confidentially offered for sale Ref No:IA017 Location: Southern Home Counties Asking price: £630,000 | | | BUSINESS LOCATION: | Undisclosed Relocatable UNITED KINGDOM | | BUSINESS SECTOR: | Manufacturing | | TRADE TYPE: | Manufacturing & Distribution | | SALE: | Agent Sale | LEASEHOLD: | £630000 | | | | | | | | | | | BUSINESS DETAILS: | Business profile:
Established in 1992, occupying substantial facilities in the south of England, this business has built an enviable reputation as one of the leading manufacturers of high quality products and equipment for the Process industries.
This business focuses on providing high quality parts, short lead times, flexible service, innovative engineering and competitive pricing. Its scope of supply includes pressure vessels and pipework – including sub sea, Skid Modules, Containerised packages, Tanks, ferrous and non-ferrous fabrications, machining and instrumentation as well as Vessel Design calculation and AutoCAD drawing. Most production consists of ‘one offs’.
Dedicated to quality, this business can rightly boast the best accreditations within its industry. The systems operated by the business satisfy the requirements of ISO 9001:2000, the Pressure Equipment Directive (97/23/EC) Annex III Module H1 and the ASME ‘U’ stamp which enables this business to export its products to the US. Although this business works mainly with a number of trade partners in the UK – as well as a number of end users - it is estimated the ultimate destination of approximately 80% of total production is abroad.
Where this business stands out from the competition however is its experience and expertise in working with exotic materials – particularly copper nickel. The business is equally at ease working with stainless steel, Super Duplex/Duplex/6MO, Hastelloy, Monel, Titanium, Carbon steel and Aluminium.
The cornerstone to the success of this business has been its specialization in low volume, high value production. By working closely with its customers, continuously investing in plant, machinery and constantly improving its manufacturing techniques this business has been able to stay ahead of its customers’ quality and commercial requirements. The parts manufactured by this business can be found in a wide range of industries and industry sectors including cryogenics, pharmaceuticals and petrochemicals to name just a few.
This business increasingly works by ‘invitation’ for its customer base forging partnerships with them to ensure they get the best service possible. It very much operates a ‘Can do’ policy. Its in-house facilities ensure a swift response to orders and design and technical input is freely available at all stages from a very professional, dedicated and experienced workforce.
Well managed financially, this is a robust, business well thought of by its customers with a strong forward order book – often stretching several months ahead. With turnover of approximately £1,700,000 generating gross profits in excess of £416,000 this represents an excellent opportunity to acquire a leading player in an extremely specialist, profitable field.
Key strengths:
This is a very well established business. Operating in areas in which there is little or no competition, it has developed an excellent reputation within its industry for producing work of the highest quality – its accreditations are second to none and not often found within UK businesses. It has no particular reliance on any one customer or even on any one type of customer – having a good loyal and widespread UK centric customer base to which it supplies high quality products at a sensible price, by way of a highly skilled, experienced and loyal workforce. It is particularly well known for its capabilities working with exotic materials. Prices are competitive whilst still ensuring a healthy operating margin.
This business works very closely and proactively with its customers – often nominated as the fabricator before it has even had chance to price a project – and is easily able to demonstrate an excellent understanding of its customers’ industries and production processes, frequently collaborating to solve production problems. This business has an excellent working relationship with its staff, many of whom have been employed there for a number of years – a wealth of experience highly valued by the customer base. This excellent working relationship has resulted in a highly motivated, skilled and reliable workforce, keen to meet customer requirements whilst still being flexible enough to respond to market conditions. It has also developed excellent relationships with local suppliers – often involved in some of the finishing elements of particular projects.
Always keeping a close eye on current market trends, well controlled financially and always with a good forward order book, this business has solid foundations and an excellent base for future development.
Key opportunities:
There is an outstanding opportunity to build on the existing business levels and customer base of this company. With a strong demand for this business's products and services, a new Owner contributing additional resources, fresh ideas and enthusiasm will have every advantage of building on an excellent platform. It could certainly be argued that the business has been under resourced in the past – with just enough capacity available to ‘get the work done’.
Set up by Engineers who have become Managers – it is thought that a more structured and commercial approach to the day-to-day operation of the business would significantly improve efficiency and productivity. Additional resources dedicated to sales – a function currently managed by the two co-Owners/Directors would perhaps enable this business to leverage the excellent reputation it has built to enter more lucrative markets – power generation, for example, and also better capitalize on the very high levels of skills and expertise there exists in-house and in particularly in the field of metallurgy. It is believed there is the scope to at least double the existing customer base.
Premises:
Ideally located with easy access to the major motorway network, airports, ports and rail terminals, this business occupies premises consisting of approximately 10,000 square feet of workshop together with approximately 7,000 square feet of office accommodation, which is under utilized.
The premises are leasehold with four years remaining – with the possibility of an extension after September 2011 – at an annual rent of £76,000 Rates are £20,000 and are currently subject to review.
Plant and equipment:
This company is very well equipped with all the plant and machinery normally expected of a versatile ‘jobbing shop’ operating in this sector including welding sets and welder manipulators, laser hand tools, rollers, drills, saws and lathes.
A full list of plant and inventory is available on application.
Information Technology:
This company operates an easy to use bespoke database system developed in-house which assists in managing the entire business including ordering, invoicing, all QA, material control, timesheets, cost control etc.
Employees:
The two current co-owners operating as joint Managing Directors are responsible for the day to day running of the operation supported by a Project Engineer operating as a Works Manager, a QA Manager, an Estimating Engineer and part-time clerical support. Up to 17 fabricators/welders together with a Storeman and a Driver/Factory hand are employed in the workshop.
Operating hours:
The business currently operates between 7.00am and 6.00 pm weekdays and between 7.00am and 12.00 noon on Saturdays with overtime as required.
Advertising and marketing:
Much of the business's revenues and recent growth has been as result of word of mouth recommendation, bearing testimony to the business's excellent reputation within the industry. It frequently undertakes facility inspections – to both its customers and their customers, the end-users.
The business has a Corporate brochure capable of being tailored to individual customer communications and the business has a well designed, easy to navigate ‘brochure’ website that performs very well in all search engines for all appropriate search terms – and from which many enquiries emanate. Having seen what projects the company has completed in the past, potential customers frequently contact the company to ascertain whether it can help with their production requirements.
Financial information:
The business is offered for sale as a going concern. All financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler.
The business is financially stable with a sound balance sheet and enjoys a strong order book. Turnover for the year ending March 2007 was slightly up on the previous year’s performance at approximately £1.7m generating a gross profit of approximately £416,600 and a net operating profit after Director’s remunerations slightly in excess of £150,000.
The Asking Price of £630,000 is for the sale of the shares in the business based on a net asset value of £180,000.
Reason for Sale:
Having built the business up to its current not insubstantial size the current Owners do not feel they have the necessary skills to take it to its next stage of development and therefore feel the time is right to pass the business on to new Owners to build on the excellent foundations already laid.
Support &Training:
The current owners will assist with any hand over and training required by the new owner to the extent that an on-going role for an extended period of time would be considered, subject to negotiation. | | | | | BUSINESS STATUS: | FOR SALE | | | | | SELLER: | TURNER BUTLER | | CONTACT: | 01895 25 6000 | | REFERENCE: | IA017 / RightBiz | | ENQUIRIES: | | | | | | | | | | | | | | | | | | | | |
