We offer for sale a 100% share of the wholesale and service business for providing offices of companies and organizations with everything necessary for functioning, that is, stationery, household goods, food products, drinks and much more. The company has a unique brand recognition and takes a leading position on Kyiv market – for example, TOP-1 in Google’s organic search results for a high-frequency query “stationery Kyiv”.
Reason for selling a business
- Over 5 years Aravak company has become one of the leaders in marketing activity on Kyiv market. Continuous work on the marketing complex led to a situation where the growth of orders and appeals reached such a level that the quality of the brand exceeds current operational capabilities significantly in terms of customer service, procurement, storing and logistics.
- Further development is not possible without serious investments in the formation of a sales and customer service department, expansion of the warehouse and logistics. The owner does not have capital to increase operating capabilities and decided to sell business.
Business profile and model
- Wholesale-service trade and services in B2B sector.
- Products – stationery, household goods, drinks, food products, office electronics, office furniture and other office supplies.
- Suppliers – direct purchases from the largest manufacturers of Ukraine and importers.
- Clients – private business, public sector, non-governmental organizations with regular needs for these products.
- Business model – contract and non-contract prepaid sales with delivery to the client’s office.
Competitive environment
- Wholesale and service companies in Kyiv with a similar business model.
- Direct selling stationery manufacturing companies (Papirus, Import-Office).
- Multi-category companies (Rozetka, Epicenter).
Marketing Positions – Leader in Kyiv
- In particular, for high-frequency queries, it has the following positions on Google in Kyiv:
- As a result, the company has the best representation on the market of office stationery among wholesale and service companies in Kyiv and is ranked on Google at the level of Papirus, Rozetka, Epicenter, and by the highest-frequency query, “stationery Kyiv” is ahead of everyone.
- Investments were made in the areas of SEO-promotion of the company's website, contextual advertising on Google, presence on core marketplace platforms Hotline.ua and Prom.ua, banner advertising, social networks and other less significant areas.
- Investments in the marketing complex in 2015-2020 amounted to $ 65,000.
- "Stationery Kyiv" – TOP 1/2
- “Stationery” – TOP 2/3
- "Buy stationery Kyiv" – TOP 3/4
- “Buy stationery” – TOP 3/4
- “Administrative support office Kyiv” – TOP 4/5
- In general, the company has TOP-7 position on the query of "stationery" among thousands of companies in Ukraine.
- The company also ranks first in Google’s organic results for thousands of low-frequency queries.
Company operational capabilities and turnover
- The company operates on a rented area of 60 sq.m., there are 2 own delivery vehicles and 6 employees.
- With these operational capabilities, the company reached the most of possible sales of UAH 6.4 million in 2019.
- Increase of a price reaches 120% for office supplies, the total average margin in 2019 was 24%, the rate of return was 11% with significant investments in the marketing complex.
- A more detailed analysis and statistics may be provided at the meeting with a potential investor.
Marketing positions and ways to increase turnover
The above marketing positions of the company provide a much denser flow of orders and appeals than the company can handle with these operational capabilities.
With the following steps and investments of the new owner, the company's turnover increases 4 times during the first year of operation:
- At the moment, the company does not have a sales and service department. The company's turnover is generated solely due to brand recognition and marketing positions. With this flow of new customers, the company is not able to process all applications and generally does not work to retain an already acquired customer. The customer retention rate is only 10%, while the market average is 25%. When creating a sales department of 3 employees, you can predict the processing of the entire flow of applications, as well as a significant increase in customer retention, which will increase turnover by 120-150% during the year.
- At the moment, the company does not work on a deferred-payment basis at all, although this segment accounts for 50% of orders on the office market. The average delay is 2-3 weeks. With investments in expanding the warehouse and increasing the company's working capital, it is predicted that the turnover will increase to 100% in the first months of operation, since the influx of customers in this segment is already provided by the company's marketing positions.
- Due to the lack of operational capabilities at the moment, the company has refused active work in the areas of office equipment, supplies, office furniture, school stationery and others. Investments in personnel, warehouse and logistics will allow returning to these areas and giving an additional 20% of turnover.
- At the moment, the company is focused on Kyiv, it has only 2% of the turnover from regions, despite the fact that this indicator is up to 25% percent on the market. Investments in personnel and marketing in regions are projected to increase sales by 20%.
Initial investment and business selling price
- In order to implement the initial changes in the sales department, warehouse and logistics described above, the new owner will need an investment of $ 50,000 in the first three months of operation.
- Further development will be provided by the difference between sales margins (24%) and profit rates (11%).
- These investments will lead to a 4-fold increase in turnover in the first year of investment.
- A business selling price is $ 310,000.
- In addition to the initial investment in development (that is $ 50,000), the potential investor needs to have a capital of $ 360,000.
- A payback period of business is 3 years.
- More detailed statistics on the current state and development forecast may be provided at the meeting with a potential investor.
Subject of sale
- All digital business infrastructure:
- Domain Name Transfer
- Hosting Transfer
- Web-site of the company
- Results of work, contacts and accounts on SEO promotion of the web-site
- Google Adds, Google Analytics, Google My Business accounts
- Social network accounts
- Account on Hotline.ua
- Account on the mailing service
- Contacts and recommendations for technical support of the web-site
- Current customer base
- Inventory in stock (about $ 15,000 at purchase prices)
- Warehouse equipment, shelving
- Transport (Opel Vivaro, class of 2008, Lanos Pick-up, class of 2015)
- List of suppliers and renewal of agreements with maximum discounts
- If necessary, support and consultation will be provided after sale
