This niche market auto parts operation is unique in that it focuses on one segment of high-end cars, purchases parts in mass from body shops, and is able to turn them around and wholesale them to other body shops in need of parts at nearly 66% the cost of new ones. The sale includes an estimated $700,000 in saleable inventory at cost that they seller will consider financing over 2 years at 7.0% interest with monthly payments, and the note secured by the business and its inventory. It is estimated that the wholesale value of the parts is over $1.7 ml, well over asking price!

This auto parts business operates out of a 1,800 square foot facility that sits on 3 adjoining lots, and leases for $5,400 per month. The current lease is a short term one, however, a long term lease can be offered shall a buyer seek it. In addition to the $700,000 in inventory, the sale includes two tool boxes, buffing and polishing equipment, and 3 lots worth of storage shelving.

There is no shortage of competition in the used auto parts industry. That said, this firm has carved out a market niche with its singularly focused products pertaining to 4 complementary auto brands. As such it has established supply side and demand side relationships in place that should provide it a sustainable competitive advantage.

The business has tremendous growth potential as a new owner can retail the same parts direct to the consumer online, via advertising as a ‘pick a part’ shop, or via any number of additional means at higher margins! Similarly, since this firm specializes in only 4 complementary brands of autos, the same business model may be applied to additional auto brands.

Posted Aug 7, 2014

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