Under contract on a $3.3 million fireworks retailer, need due diligence.
September 06, 2024
by a searcher in Texas, USA
I am under contract with due diligence till Oct. 8 on this fireworks retail company. Where do I start? Limited on funds, saving them for the injection (down payment).
Apart from the seasonality, lender likes the deal. Debt service coverage ratio is healthy. Seller financing of $230,000 on a small earnout for New Years 2025, and July 4th 2025 seasons. Established in 2003.
If your due diligence consultant, feel free to contact me.
in Northampton, UK
from University of Georgia in St. Louis, MO, USA
2. What is the employee predictability? You've got a lot of cyclicality, but you may want to check for the longer term people and/or whether you have a lot of the same people coming back during the peak periods.
3. Do you like the customers? With a business that size, you'll be talking to customers constantly. If you don't like them, you'll hate your job.
While the focus is often on getting a transaction done, the transaction is really getting to the starting line of running a business. Be sure you'll like the business.