TorcCo Food Supplements
Normalized Cash Flow: $191,000
What they do – the short version . . .
- TorcCo is a very profitable business for sale that has been around for over 20 years.
- There are only two active participants and they wish to retire.
- TorcCo is involved in the growing nutritional supplement business.
- They have both US and Canadian Patents.
- TorcCo also has a Health Canada Licence
- The sellers’ role is managing distribution between their custom manufacturer and the distribution firms who call on health food chains and associated clinics.
- This business would be ideal for a couple.
Health food supplements are a growing segment in part due to the retirement of the baby boomers and the general interest in the public to maintaining healthy diets and lifestyles.
TorcCo is in the middle of this industry managing the flow of their product channel from manufacturer to retail health food stores and to industry associated clinicians.
TorCo sells to distributors who in turn sell to Health Food chains and stores and to clinicians associated with the industry such as practitioners of natural medicines. Most of the customers are repeat.
Baby Boomers are getting old and becoming much more health conscience and selective about what they eat.
But the growth is coming from the millennials who are taking nutrition much more seriously than their parents did at that age. (I have kids in their mid-30’s and do not recognize much of the food in their fridges.)
Both these groups are getting more advice from their trusted professionals about their lifestyles and foods they eat.
Three years of financial statements and a complete equipment list is available for qualified buyers.
Q. Why you are selling?
A. One owner is 83 the other 65
Q. In your words, what does the firm do?
A. We provide a licensed supplement to health food stores and clinicians
Q. What functions do the owners perform? What talents will the new owner have to replace when you leave?
A. We formulated and developed the supplement. We support the sales people with any questions they or their customers may have on the supplement. We also attend some trade shows with the distributor, and we help to train customer staff on the supplement
Q. How long will you stay after the sale to help in the transition?
A. One of us is willing to stay on for 2 years to help educate, tour and facilitate a smooth take over
Q. Can you estimate what it would cost for a competitor to start up?
A. A lot of time. New products cannot enter the Canadian market or be sold without a Health Canada license and review of the proposed new product. This process can take up to 2 years. We have clinical trials which help give efficacy to our product. A competitor would have to do trials and tests, they can cost $100,000 for a small trial, and Health Canada require approx. 2 years for approval and study start-up
Q. Have the accounts receivable been purged of bad debts? (This will is really a lawyer question).
A. We do not have any bad accounts. We only ship product when we get paid. We have maintained that for 18 years. Our distributor takes on the responsibility of collecting receivables from his accounts.
Q. Will you agree to a non-competition clause?
A. Yes but that would depend on the amount the buyer was offering.
Interested? Next steps:
1. Fax / scan the non-disclosure document
2. Phone discussion
3. Release of financial information
4. Meeting with seller and tour of premises
5. Discussions that may lead to a deal
The information on contained in this document has been provided from sources believed to be reliable. You must seek independent verification of these facts through due diligence before taking any action based on this informatio