Everyone has already been to at least one party, and has eventually hosted a few parties as well. We all know that parties and celebrations are part of families all around the world, going from birthday parties, company celebrations, holidays, and much more.
In order to make these gatherings possible, there are many necessary supplies that are expected culturally. Costumes, candy, balloons, cakes, and much more can be found at Party Supply Stores, that specialize in giving the best experiences to all parties.
Usually Party Supplies Stores are located in high density parts of the city, and can also be found online as e-commerce stores. They have a lot of different supplies, and gain on the margins from their high volume of inventory.
If you want to sell your Store, there are many things we will explore in this article that can help you accelerate the process to make a successful sale.
What is your Party Supply business worth?
If you don’t know how to value your business yet, don’t worry. The very first thing you have to do is compile all financial data you can find regarding the past three to five years.
The point of doing that is gathering all finance information potential buyers need to show their interest in closing the deal.
And as it is a very competitive business, you better know how the other party supply stores are working around you.
In order to discover exactly what your business is worth, make sure you have all the information below:
- What are the sales?
- What is the profit?
- What are the growth trends?
- What is driving new sales and is that sustainable?
- What channels do new customers come from and what is the breakdown of each channel?
- What is your market position?
- Is your Location favorable?
- How reliant is the business on the owner?
- What systems and processes are in place to run the business?
What makes a Party Supply business worth more?
Having a great location, where a lot of people pass by, especially your target public (can be children, moms, and teenagers) with a great and catchy entrance, can make a total difference in the number of sales.
If you are well positioned online and sell through ecommerce, that can make an extreme increment in your business valuation also.
Of course thats not all. Take a look at the following metrics:
- Predictable key drivers of new sales
- Stable or growing traffic from diversified sources
- Established suppliers of inventory with backup suppliers in place
- Traffic stats
- High percentage of repeat visitors and repeat sales
- Clean legal history
- Brand with trademark, copyright or legal concerns
- Documented systems and processes
- Growth potential
What does the average Party Supply business sell for?
Not many party supply stores have been sold in the last 10 years, usually not being a popular type os business that generates high liquidity in the market. In the last years there have been 30 buyouts, with an average multiple of 1.86, meaning that average asking price is almost twice as the total gross income.. The average sales price is around $161,612 that isn’t bad, but no high also.
The total transaction value is $4.848.350,00 the last 10 years, and the most frequent sales deal is around $130.000. These values show that it isn’t frequent, but also not impossible to be able to sell your store.
What is the most frequent deal size?
The most frequent deal size is $130k as mentioned before, that is actually lower than the average sales price. But why does it happen?
If you take a look at the chart, you’ll notice that most of the stores that have been sold in the past years were negotiated for less than $250k. The higher the deal size, more difficult it is to sell.
Is the Party Supply Store market getting bigger?
As like most of markets in the United States, the party supply store market has its ups and downs.
In 2014, there was only one deal, being only $145k. But as in 2013, the Total Transactioned value was more than $1.4 million. In 2012, also only one sale,and in 2011, 2 deals were made.
For now, it’s not possible to predict if 2016 numbers will be better than last years, but the expectation is that the number will grow.
Are bigger businesses worth more?
In general, the bigger the business, the higher the multiple. That’s the case for party supply stores, but with few exceptions.
Since all the deals are lower than $250k it is hard to tell if the valuation is correlated with the multiple.
What states have the most Party Supplies business deals?
Are you wondering where the most deals were made throughout the country, or if your state has a hot market to sell fast? As you can see if you are located in California or Florida, you may get a lot more offers than if you are in the northwest. But sometimes you can overcome the low number of deals with investors or competitors looking to enter a specific new area, and get lucky with an offer!
Why would you sell in the first place?
The reason to sell always varies from each person. Maybe you are looking for new challenges, businesses and opportunities, or you just want to enjoy your family and retire. Although it can seem tempting to get your hard worked cash, make sure that you are clear on the motives so you don’t regret afterwards.
How long will it take to sell your Party Supply Store?
If you have read all the necessary steps to understand your valuation, and think you have focused on all the topics that make your company worth more, it is maybe time to start the process. Selling your business is a long-term process, and doesn’t happen overnight. Usually companies sell in 12 months, but you can also see deals getting closed in 6 to 9 months depending on the opportunity.
What is the process of selling your Party Supply Store?
This step by step process will help you get less confused when you make sure you are ready and confident to let go of your business, and perform a nice and positive sell. Many entrepreneurs forget about a step, or just don’t have the right guidance to know all the stages necessary and get lost through the process. Don’t forget to go through all of these, and if you have any questions, comment at the end of the article or contact us for more help.
Who will buy your business?
If you are wondering about the buyers that can be interested in your Party Supply Store, don’t worry, there are many options and possibilities. From First Time entrepreneurs, to businessmen interested in new opportunities, the chances are that in the bars and pubs industry it may likely be a person who already had a store in the field.
There has been more than 30 stores sold in the United States over the past ten years. Businesses like that are also very expensive and profitable, but we can’t say one year is better than the other.
If you want to start accelerating your buyout process, fill out our free valuation form and get your business valued today! Leave your comments on any doubts or feedback, we are glad to hear your thoughts!