The Business: Here's a three-year-old company that could spark any entrepreneur's interest: a fuel supplier whose proprietary tug-and-barge equipment allows it to service yachts whether they're docked or navigating local waterways. Revving up its fast-growth engine is an arrangement for low-cost fuel with one of the nation's largest oil companies, allowing this delivery service to significantly undercut prices at local marinas. With about 1,200 well-heeled customers, this company would be fairly sheltered from sticker shock even if oil prices continued to climb. The current owner wants to concentrate on his other business venture -- building fuel-delivery boats for companies elsewhere -- but his four employees (two captains, a general manager, and a bookkeeper) should be willing to chart a new owner's course.

Price: $1.2 million (owner financing possible)

Outlook: It's full speed ahead for this unique fuel-service business. The owner-invented, proprietary hydraulic fuel-delivery system provides customers with a level of pampering that's been so popular that advertising hasn't been necessary so far. A new owner who is interested in growth need not worry about competitors, because the proprietary delivery system, plus the number of licenses needed to operate in this area, guarantees a formidable barrier to entry. To switch to a more accelerated rate of growth, a new owner could branch out to other nearby areas of concentrated yachting activity or add new services, such as the delivery of lubricating oil to commercial ships (a diversification effort that could yield margins as high as 35%). Profits might also be improved if a new owner invested in a "tank wagon" that would permit the company to pick up its own fuel and allow it to shop even more aggressively for rock-bottom prices.

Price Rationale: The more unusual a company is, the tougher it is to value. But one appraisal expert suggests a ballpark figure of three times recast earnings (in this case, about $734,000). As he explains: "That's a level that premium businesses sell for these days -- and given this company's fast growth and profitability, it probably deserves to be priced at the upper end of the market." But if a new buyer allows the deal to be pushed too much higher, the current level of recast earnings won't cover compensation, an adequate return on investment, and any financing costs.

Pros: What an unbeatable combination: a sunny climate, a wealthy client base, and a fast-growth, high-profit profile.

Cons: Pay too much and your oil tank will, well, tank.

Gross Revenues Recast Earnings*
1997** $71,827 $9,414
1998 $705,680 $110,252
1999 $1,068,094 $244,573

*Before interest, taxes, depreciation, and owner's compensation.
**1997 operation spanned only October through December.

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 Ted Peterson at 954-214-1154.

Please e-mail your comments to