Engineering wholesale business for sale

Hardware Engineering Supplies operates from leased premises at 139 Manukau Rd, Pukekohe. Photo / Supplied

A prominent Franklin based engineering supply store — with more than 3500 customers and support by over 700 suppliers — is for sale following 16 years of ownership.

The business brokerage firm LINK is marketing the wholesale business, Hardware Engineering Supplies (HES), operating from leased premises at 139 Manukau Rd, Pukekohe.

This follows a decision by co-owner Evan Bedingham to pursue new ventures, while fellow owners — husband and wife Geraldine Irwin and Paul Irwin — have announced their intention to retire.

LINK's Brett Clarkson says the business in Manukau Rd, Pukekohe, has become a leading supplier in the Franklin area, having long-standing affiliations with TradeZone and acting as the franchisee for Hydraulink Fluid Connecters Ltd (Hydraulink) in the region.

"Hardware Engineering Supplies has proven to be a profitable business consisting of a loyal customer base with huge potential in the market. The combined benefit of its alliance with TradeZone and Hydraulink make for a powerful, highly-regarded market presence," says Clarkson.

The location of the business, although among its competitors, is a benefit for the sector as it is known by the trade to be the hub of mechanical and engineering equipment and tools.

"The business is situated in a prime location. Being among its competitors enhances the potential of the business, as there is an organic reach to potential customers.

"The relationships HES has built with sector organisations, also give it the advantage of group-purchasing making itstand out from its competitors," adds Clarkson.

About 200 of the firm's suppliers have TradeZone affiliation and the Hydraulink product attracts a lot of customers to the business.

In 2017, the company turned over about $1,985,000 and in 2018 revenue was $2,252,000.

The company shows a substantial gross profit tracking upward from the 2017 year to 2018 with this year tracking along similar lines.

"Pukekohe has been a real growth area recently, thanks in part to its new residential housing development. There's further expansion planned, coupled with huge potential stemming from new developments both there and in neighbouring areas such as Pokeno.

"Clearly, that will result in a significant opportunity for HES's new owners to capitalise on, and market demand that's unlikely to slow down," says Clarkson.

Hardware Engineering Supplies has an asking price of $1,495,000 — which encompasses $750,000 worth of stock and tangible assets including two company utes.

The business leases its Pukekohe premises, paying $77,072 in rent annually and employs a total of seven staff, with a mix of full time, part time and contractors.

At present, co-owner Evan Bedingham operates as HES manager and chief operations, while Paul Irwin employed as a counter salesperson. The men both intend to exit their operations roles following the sale of the business.