Our client offers a comprehensive range of products and services in the textile and materials processing sectors. In addition to supplying embroidery consumables, they sell, install, maintain and reprogram embroidery and laser cutting machinery. They also provide a bespoke laser cutting service, tailored to cut and engrave a wide range of materials as per customer requirements.

The company is based in the English Midlands.

Highlights

• Turnover approximately £1,425,000 in FY 2023 (unaudited figures)
• 2024 performance suggesting a return to profitability
• Gross profit up 12% over 3 years to 38.6%
• Admin costs paired back from 38.1% in 2021 to 31.3% in 2023
• Around £300,000 of inventory held (sale price approx £600,000)
• Extensive range of embroidery consumables
• Own range of embroidery machinery as well as popular Brother machines
• In-house laser cutting team with three operatives and eight machines (currently 20% spare capacity in this one-shift department)
• In-house installation, maintenance and reprogramming team for embroidery and laser cutting equipment
• Three income sources in markets poised for impressive growth in coming years
• Top ten customers account for 34% of revenues so risk well spread among client base
• Very strong brand reputation built up over 36 consecutive years of trading

Current overview

Trading since 1988 and under its current ownership since 2019, the company expects to return to profitability in 2024. The main causes of the losses were a lack of permanent UK leadership, the COVID-19 pandemic and the rise in utility costs.

To combat this, the current owner flies in at least once a month from his overseas base to provide oversight and direction.

Other actions taken to restore profitability include:

• A conscious and successful effort to both improve gross margins and reduce overheads
• Investment in a new ERP system which will allow further staff rationalisation while improving productivity and efficiency
• Close to the launch of a new ERP-powered website to streamline the sales process

Key factors to take note of are:

• The company has a skilled workforce, a sizeable inventory with fast turnarounds and an in-house laser-cutting production facility.
• A significant proportion of their income comes from existing clients returning year after year.
• There is significant potential extra capacity in the highly profitable laser cutting department.

Where the potential lies

Under an experienced leader with a fresh, strategic vision for the company, the prospects for the business are very bright.

The company has three income sources in markets expected to grow quickly between now and 2030.

It has a wide spread of sales meaning that it is not vulnerable to the loss of some of its larger clients.

The company benefits from experienced and talented staff who, given the right direction under new owners, will quickly grow the business and help it achieve high levels of profitability.

Further enquiry

To obtain a copy of the information and investment memorandum for our client, please contact Swan Corporate Brokers using the form below.