Howick's Grasslands looking for buyer to cut a deal

The Grasslands Outdoor & Leisure store which is for sale in Howick.

Howick's Grasslands Outdoor & Leisure Limited, a long standing retailer of home and garden outdoor equipment like lawn mowers and garden tools, is for sale for an asking price of $305,000 plus stock estimated at $90,000.

"This is a very reasonable price for an incoming purchaser because it would easily cost around $350,000 and more to set up a business like this from scratch and it would have no history, cash flow or a recognised brand," says Richard Ridler of Link Business Broking Ltd of Ellerslie who is seek interested parties to purchase all of the assets of the business as a going concern business.

Ridler says the estimated fair market value of the business is actually $383,616 based on stock of $90,000 plus plant of $65,000 and intangibles at twice the earnings before proprietor's drawings, interest, tax and depreciation (EBPITD) of $228,616.

"Replacement for the plant alone would be well in excess of $200,000," he says.

Grasslands was originally established in the mid to late 1980s and has been owned and operated by its present owner from the premises at 209 Moore St, Howick, since 2011.

"The business has been a longstanding retailer of home and garden outdoor equipment such as mowers, other mechanical and non-mechanical garden tools as well as indoor solid fuel heaters and a range of bicycles," Ridler says. "The business has a workshop and provides a full mechanical and repair service for its customers. There is no similar business in the Howick Pakuranga area."

Since purchasing the business the present owners have revamped the store and introduced some new and exclusive products.

"This has incurred some capital expense but has created an outstanding retail outlet to feature the products stocked for sale," Ridler says.

"A new owner may bring new ideas and energy but the business has historically always operated profitably and has been in operation for over 25 years."

The present owners have the day to day responsibility for the business assisted by one full time mechanic and retail assistant and one part time administration employee.

Ridler says there are other Grasslands stores around Auckland which are unrelated to this business although a buying group has been proposed.

"Grasslands in Howick has full and exclusive rights to the Grasslands name for its business. There are no royalty, franchise, or any other fees or costs associated with the rights that this business has."

He says Grasslands has little or no competition in the area serviced by this business and has a regular clientele. "This is helped by being a full service provider so no task is too hard to help or fix which has potential to grow sales and encourages customers to shop with them rather than with a competitor." Another advantage is its high visual exposure due to the newly renovated shop having a prime busy corner site next to two busy roads and a business strategy of stocking strong brand names.

"The store has exclusivity for some well-known brands of outdoor equipment and also stocks a range of solid fuel fires that helps to ensure smooth winter month cash flows," Ridler says.

Ride on mower brands include Husqvana, Hustler and Honda while standard mower names include Lawnmaster, Morrison and Masport. The store stocks Bauer and Jamis cycles and other well known products like Atom edgers and Briggs and Stratton motors.

Customers also have the benefit of an adequate amount of free parking.

Ridler says one of the owners of the business wants to retire and the other wants to pursue other unrelated business opportunities.

"The owners will ensure a seamless transfer and either or both are prepared to stay on in a longer term part time role if required by the purchaser. This business should continue to grow and perform better with a committed owner operator," he says.