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Specialty Commercial Printer

This commercial printing company has been providing specialty printing services to customers in the Greater Toronto Area for over 20 years. It sells its services directly to end user clients and also through wholesale commercial printers. Many large reputable wholesale commercial printers subcontract their specialty printing work to this company as individually, they do not have the volume of specialty work to justify doing it themselves. Operating as the "Printer's printer," the company has carved out a very profitable niche market for itself backed by its excellent reputation for high quality, reliable, and on-time work. The most noticeable aspect of this business is its extraordinarily high net profit margins of 35% (based EBITA/Revenue) which is substantially higher than the general printing industry. The owners attribute the profit high margin to its efficient operation, a reputable name that allows it to charge a premium price, the fact that their customers requires a local provider hence protecting them from U.S. and overseas competition, and that there is a duopoly situation in the Toronto area market in which it is one of only two providers of such services. The company has approximately $2 million dollars worth of equipment making this business highly capital intensive (which is a good barrier to entry), and also provides a means for the buyer to leverage financing. As an established business of over 20 years, the company has developed deep industry network connections and an established clientele. The company no longer actively solicits new business as virtually all work is from repeat business and referrals. The owners are selling the business as they would like to retire.