The Company is the leading Canadian manufacturer of commercial floor cleaning machines and vacuums. Established in 1971, the Company has earned a reputation as one of the most trusted brands among professional cleaners in Canada with an expanding presence in the USA.
The Company meticulously hand-builds and tests every machine, delivering greater longevity, utility, and reliability. The versatility and unique features of these products allow customers to perform the same job or task that would ordinarily require multiple machines, with just one machine.
The Company maintains a customer base of over 500 active clients and approximately 80% of revenue is generated from repeat business. The Company’s large and established customer base is a strong asset that contributes to the stability of the business and presents opportunities for revenue growth going forward. The Company’s network of trusted customers includes well-known municipal institutions, schools, hospitals and other large organizations.
Products and Services: The Company’s products and equipment are purchased by industry distributors (70% of 2023 revenue) or individual end-users (30%). Distributors of the machines typically sell the Company’s products to commercial cleaners, Building Service Contractors (BSCs), property managers, universities & colleges, school boards & districts, healthcare facilities & providers, office buildings, hotels & casinos, government agencies, and more.
Individual end-users span various industries and include schools, restaurants, auto-detailers, local retail outlets, restoration and trades contractors, independent commercial cleaners, and specialty service providers. Geographically, the Company has a strong domestic footprint, with 90% of 2023 revenue generated in Canada, while the remaining 10% mainly comes from the United States.
Geographic Expansion: While the Company’s current location supports an expansive geographic range, the Company could expand into new markets by establishing new distributor relationships in key geographies in the US. Management indicates that the US would be a logical area of expansion, increasing revenue opportunities and geographic diversity. The Company’s unique products with their compelling value propositions, established reputation, and extensive experience would enable it to compete successfully in the US, given an appropriate level of capital investment.
Rising Gross Profit Trend: Throughout the historical period, gross profit increased from 49.6% of sales in 2020 to 55.4% of sales by the end of 2023. Management has been able to efficiently control cost of sales after high growth, demonstrating the Company’s ability to maximize profitability potential going forward.
Superior Reputation and Differentiated Products: The Company’s 50 + year history enjoys a long-standing reputation for the quality of the Company’s products and services, expertise, dependability, and superior customer support. This is the only Canadian manufacturer of commercial floor cleaning machines and vacuums, and the Company’s products are differentiated via greater longevity, utility, and reliability than the competition. Furthermore, the company currently has an active distributor network of over 100 companies across Canada and in parts of the US.
Historical Sales Growth: Historical sales have grown from $940,000 in 2020 to $1,583,000 in 2022, representing a compound annual growth rate of 29.8%. Sales have grown consistently year over year during the historical period.
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