Selling an Interior Design Business in Florida
A Guide for Florida Distribution Business Owners by Patrick Archer, MBA, CBI, CM&AP | Florida M&A Advisor | CII Business Advisors | 305.763.4112 (Mobile) | patrick@ciiadvisors.com
Selling an Interior Design Business in Florida
Selling an Interior Design Business in Florida is an important decision for owners of these essential business in the Sunshine State. Owners contemplating selling a Florida interior design business must weigh the pros and cons of selling the business. Retirement is the primary motivating factor for most owners, while other Florida interior design and home remodeling business owners may be planning to pursue new ventures in different industries.
Regardless of the motivations, sellers of interior design businesses in Florida will want to package and price the business to stand apart from competing listings and attract potential buyers. Many of these buyers are looking to take ownership of a successful business in Florida and tap into the positive demographics, population growth, median household income and other trends benefitting Florida small business owners today.
Timing Considerations when Selling an Interior Design Business in Florida
If you are the owner of a successful interior design business in Florida, now could be a great time to take advantage of these trends and the rising demand among U.S. and international buyers for great businesses for sale in Florida that are established, profitable, “essential” in the eyes of local governments, and resistant to external pressures like online retailers and inexperienced start-ups.
Selling an Interior Design Business in Florida today can also help sellers command top dollar considering the supply and demand imbalance of available interior design businesses in Florida post-Covid-19. While the pandemic wiped out thousands of small Florida businesses in sectors like restaurants, gyms and beauty salons, Florida interior design and home remodeling businesses emerged stronger and more attractive in the eyes of their owners, their customers, and potential buyers.
The Interior Design Industry in Florida
The interior design services industry in the United States is a $16 billion industry, and Florida is one of the warm-weather states with strong year-round demand for interior design services from both residential and commercial clients statewide.
“Florida is one of the Top 3 markets in the $16 billion U.S. interior design industry”
Interior design firms in Florida are currently benefitting from the growing number of high net worth families and companies relocating to Florida from high tax environments and rising crime rates in major metropolitan areas in the Northeast. Many of these new Florida residents require professional interior design services for their luxury homes, waterfront properties, outdoor living spaces and private yachts.
“Florida interior design firms are benefitting from several positive migration trends”
Buying an interior design business in Florida can be an attractive turnkey opportunity to enter a market with an existing showroom and an established roster of loyal residential and commercial clients willing to pay top dollar for professional interior design services and expertise.
Skills needed to Operate an Interior Design Business in Florida
As in all states, the interior design sector in Florida is highly competitive, and owners of the most successful interior design and home remodeling businesses have many years of experience and hundreds of satisfied customers who depend on these companies for their talent, vision and creativity.
Current owners thinking of selling an interior design business in Florida will want to know that potential buyers of the business have the operational knowledge, managerial skills and financial resources necessary to manage and grow the business for the next generation.
Most buyers of interior design and home remodeling businesses in Florida will pursue SBA financing, and most SBA lenders will want to see that the buyer has some knowledge or experience in the interior design or home remodeling business.
“Florida interior design companies serve both residential and commercial clients.”
Ideally, a future owner of an interior design business in Florida would already have several years experience as an employee or owner/operator of an interior design business in their home state or home country.
Many owners of established interior design businesses in Florida will only consider selling their business to a buyer who has a proven track record of experience in the interior design industry or a related industry, either as an employee or an owner/operator of the business. Most SBA lenders will view potential buyers through the same lens of relevant interior design experience and qualifications.
Best Cities For Selling an Interior Design Business in Florida
For potential buyers open to living anywhere in the Sunshine State, sellers of interior design and home remodeling businesses in Florida will be competing with other owners of similar business statewide. These buyers will be weighing several factors including a variety of demographic and quality of life metrics that will impact both their decision making process.
Florida’s population of 23 million is spread throughout the state’s 67 counties, but the largest clusters of high net worth households paying top dollar for interior design services are concentrated in the southern half of the state along a ring of 14 coastal counties on the Atlantic Ocean and the Gulf of Mexico. This “golden horseshoe” of Florida demographics encompasses the 25 Wealthiest Zip Codes in Florida based on Average Gross Income.
“This 14-county coastal region is the Golden Horseshoe of Florida demographics.”
This 14-county coastal region extends from Tampa/St.Petersburg on the Gulf side, south to Naples/FortMyers and down to the Florida Keys, east to Miami/Fort Lauderdale and extends north through the coastal communities of Pompano Beach, Boca Raton, Palm Beach, Jupiter, Stuart, Hobe Sound, Port Saint Lucie and Vero Beach. Some of Florida’s largest and most prestigious interior design companies are located in this 14-county coastal region.
And, of course, no conversation about desirable areas to live and own a business in Florida would be complete without mentioning the Orlando metropolitan area. “The City Beautiful” is one of the fastest-growing metros in the country, and the influx of new residents creates ample opportunities for new and existing business owners.
“With over 2 million residents, Orlando’s economy is booming and increasingly diverse”
Long known as a tourism mecca and home to theme park giants like Disney and Universal, Orlando’s economy is increasingly diverse. And world class infrastructure improvements like the new $3 billion Terminal C at Orlando International Airport facilitates domestic and international arrivals and intrastate travel with Brightline, a high-speed rail link between Orlando and South Florida metros like Miami, Fort Lauderdale and West Palm Beach.
Median Asking Price of an Interior Design Businesses For Sale in Florida
Once you’ve decided on selling an interior design business in Florida, it’s a good idea to work with a licensed Florida business broker to get a better understanding of the current value of your business and a most probable selling price to qualified buyers looking to buy your Florida interior design business with some combination of cash and financing, either through an SBA loan, seller financing, a bank loan, a leveraged buyout, assumption of debt, or some other mutual buyer/seller agreement.
According to the Florida database of businesses for sale, the median asking price for interior design businesses for sale in Florida is $750,000 for existing businesses generating over $500,000 in annual revenue and over $150,000 in annual cash flow.
“The median asking price of Florida interior design businesses for sale is $750,000”
The range of asking prices for Florida interior design businesses for sale extends from $285,000 on the low end to $1,700,000 on the high end for Florida interior design firms generating over $500,000 in annual revenue and over $150,000 in annual cash flow.
Median Annual Revenue of Interior Design Businesses For Sale in Florida
With a talented design team, strong reputation and an established clientele, interior design companies in Florida can be great revenue generators for both current and future owners. According to the statewide database of businesses for sale in Florida, the median annual revenue for an interior design business in Florida is $1,160,000.
“The median annual revenue of Florida interior design businesses for sale is $1,160,000”
The range of annual revenue for Florida interior design businesses for sale extends from $580,000 on the low end to $4.680,000 on the high end for Florida interior design businesses generating over $500,000 in annual revenue and over $150,000 in annual cash flow.
Median Cash Flow of Interior Design Businesses For Sale in Florida
Established and well managed interior design businesses in Florida can produce significant cash flow benefitting both the current owner and future owners of these businesses.
“The median annual cash flow of Florida interior design businesses for sale is $270,000”
According to the official database of businesses for sale in Florida, the median annual cash flow or owner benefit for interior design and home remodeling businesses for sale in Florida is $270,000. As such, interior design firms for sale in Florida enjoy a median cash flow of 23% of annual revenues. ($270,000 / $1,160,000 = 23%)
The range of annual cash flow for interior design businesses for sale in Florida extends from $180,000 on the low end to $580,000 on the high end for Florida interior design companies generating over $500,000 in annual revenue and $150,000 in annual cash flow.
“The median payback period for a Florida interior design business is 2.7 years.”
Based on these same numbers, the ratio of median cash flow to asking price for existing Florida interior design businesses for sale is 36% ($270,000 / $750,000) which translates into a median payback period of 2.7 years.
Additional Resources for Selling an Interior Design Business in Florida
Selling an Interior Design Business in Florida is a major life decision that requires serious due diligence and sound guidance from experienced and trusted M&A advisors.
If you would like to schedule an initial consultation regarding your Florida interior design business, current valuation and next steps, please call me at 305.763.4112 or email me using the contact form below.