The Business: Ready for the call of the really wild? Then take aim at this outdoor-recreation business, complete with a nationally renowned big-game-hunting division and a fast-growing guest ranch that caters to corporate retreaters as well as to family vacationers. Worried you won't be able to tell the difference between Rocky Mountain elk and mule deer (your two biggest hunting targets)? With more than a dozen seasonal guides, as well as a wrangler, two cooks, and a high-powered team of telemarketers, you should be able to hit the bull's-eye on this nine-year-old business pretty quickly, even without the involvement of the seller, who's ready to saddle up and move on.
Outlook: Thar's gold in these hills, since big-game hunts could well turn into the mother lode for a growth-minded new owner. Gross sales for the first quarter of 1998 were already at $600,000--nearly twice last year's total revenues--thanks to year-round telemarketing, a glitzy Internet site, and a highly effective publicity campaign. Hunts are booked through the year 2000. If your binoculars are set on boosting sales, you've got options: among them, more aggressively marketing the guest-ranch business--now just 20% of revenues. Another no-brainer: add staffing and cabins to increase the number of big-game hunts you can offer to customers at $3,500 per seven-day shoot. Worried about the shortness of the hunting season (which runs from September through mid-December)? Try marketing to winter vacationers with cross-country skiing and snowboarding on their minds.
Price Rationale: The scariest thing about this big-game hunt might just be its price tag. Savvy shoppers seldom base bids on growth prospects, but without focusing on those here, it's tough to justify a price that's nearly 10 times the three-year average for recast earnings ($155,530). Still, this year's results do look nearly as breathtaking as the scenery. The business's real estate holdings, livestock, and equipment have been appraised at $540,000 (which doesn't include the value of leases and permits for close to a million acres of prime mountain land). While this business is so quirky that normal rules of thumb don't apply, you could view the deal as a partial real estate play. Add to that price a more conservative figure of four to five times average recast earnings ($622,120 to $777,650), and you might be able to justify a bid of around $1.2 million...so long as you're willing to push growth like crazy.
Pros: Great views, an outdoorsy lifestyle, and strong business fundamentals. The scene is set to really make a killing.
Cons: If you're worried about Bambi--or life as a big-game telemarketer--buy a water pistol instead. --Jill Andresky Fraser
|Gross Revenues||Recast Earnings*|
*Before interest, taxes, depreciation, and owner's compensation.
Inc. has no stake in the sale of the business featured. The magazine cannot confirm the accuracy of financial or other information offered by the seller. Inquiries should be directed to Ronald Chernak, First Business Brokers Ltd., at 719-635-9000.