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Translating & Interpreting for Healthcare & Schools

A down payment of $51,000 returns $99,301 in the first year after debt payments!

CASH FLOW
$177,567

Specifications

  • Price
    $510,000

  • Revenue
    $768,545

  • Cash Flow
    $177,567

  • Location
    Cleveland, Ohio

  • Service Area
    Interpreting (85%): Northeast Ohio; Translating (15%): Nationwide

  • Profit Margin
    35%

  • Intangible Assets
    Long-term relationships with clients, secured large medical clients, low overhead, strong group of contracted employees

  • Reason for Sale
    Retirement planning

  • Employees
    102: 2 Coordinating assistants, 75 local interpreters, 25 remote translators

Priced at $510,000, a down payment of $51,000 returns $99,301 in the first year after debt payments – a 195% return on investment! Serving large health care, municipal legal, and school systems, along with commercial businesses, Social Security Administration, and individual customers, the seller of this LSP business is willing to do performance based earnout to show vested interest. Interpreting 50+ languages accounts for 85% of revenues, with translation of 150 languages accounting for the remaining 15%.  With 102 contracted employees, 75 of which are local interpreters, this business operates with low overhead, earning a 46% profit margin last year. 2020 numbers were down due to COVID-19, as 80% of their client base consists of schools and hospitals. There is complete confidence that the business will return to normal levels as establishments are re-opening. Established in 1997, many customers have been with this firm for over twenty years and have strong working relationships to draw upon. The owner remotely manages the day-to-day operations and routes the work to the team of translators. The translating duties could be distributed to a contracted employee, if desired. 

 

Current administrative operations are completed remotely and both contracted coordinating assistants work part-time from their home.  The bank of 75 contracted interpreters are local and take assignments throughout Northeast Ohio and work in over fifty languages.  The team of 25 translators work in over 150 languages and are all remote hires. 

 

This small but mighty team has grown their customer base and maintained a positive reputation in the area.  To build upon current successes, investment in marketing could be effective in generating new clients as could networking with local business owners. The company does not currently have a scheduling portal – a new owner who has a technology background and could implement this feature would be incredibly beneficial to the business.

Business Highlights

  • Year Established: 1997
  • Location:  Cleveland, Ohio
  • Service Area:  Interpreting: Northeast Ohio; Translating: Nationwide
  • Services: Interpreting (85%): Northeast Ohio; Translating (15%): Nationwide
  • Clients: Large health care systems, municipal legal system (courts and lawyers), commercial businesses, individual customers, school systems
  • Lease: Work remotely! Low overhead! 
  • Reason for Selling: Retirement planning
  • Contracted Employees: 102: 2 Coordinating assistants, 75 local interpreters, 25 remote translators
  • Seller Training Period: 6 months
  • Growth Opportunities: Invest in targeted marketing to reach new customers, consider upgrading technical operations to increase efficiency, network with local business owners to generate connections
  • Current Owners’ Responsibilities: Operates business 

Financial Highlights

  • List Price: $510,000
  •  

    Cash Flow Analysis

    Description of Financial StatementTax Return
    Cash
    Tax Return
    Cash
    Tax Return
    Cash
    Tax Return
    Cash
    Notes
    2020201920182017
    GROSS SALES$353,119$768,545$736,752$544,939
    Net Income Shown on Financial Statement$85,318$180,098$159,552$101,228
    ADDBACKS
    Compensation to Owner $25,000$50,000$50,000$30,000
    Meals & Entertainment $0$509$832$832
    Professional Fee $7,308$1,400$0$2,700
    Legal$5,500$0$0$0
    TOTAL ADDBACKS$37,808$51,909$50,832$33,532
    Seller's Cash Flow = Total Addbacks + Net Income$123,126$232,007$210,384$134,760
    Profit Margin34.86 %30.19 %28.56 %24.73 %
    • Profit margin: 35%
    • 2020 numbers were down due to COVID, as 80% of their client base consists of schools & hospitals

    Typical Clients

    • Large health care systems
    • Municipal legal system (courts and legal)
    • Commercial businesses
    • Individual customers
    • School systems
    • Social Security

    Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.

    2020 / COVID Notes

    Hospital systems and school systems were not at full capacity, which impacted the 2020 numbers; however, there is complete confidence this business will flourish again post-pandemic. The seller is willing to do a performance based earnout to show vested interest.

    Services

    • Interpreting (50+ languages): 85%
      • Healthcare
      • Courts, immigration, lawyers
      • Commercial business
      • Events, conventions, sports games
      • Schools – 15 local school districts, IEP, testing, conferences, documents
    • Translating  (150 languages): 15%
      • Commercial business
        • Brochures
        • Advertising
        • Instructions
        • Documents
      • Documents
      • Legal documents
      • Technical documents
      • Personal records
      • Financial documents

    Employees

    Total Contracted Employees: 102

    • 2 Coordinating assistants
    • 75 Local interpreters
    • 25 Remote translators

    Growth Opportunities

    • Invest in targeted marketing to reach new customers
    • Consider upgrading technical operations to increase efficiency
    • Network with local business owners to generate connections

    Valuation Details

    Funding Example

    Purchase Price:

    $510,000

    $
    %
    OR
    $
    %
    OR
    $
    Years
    %

    Bank Loan Needed: $

    Years
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    Funding Details

    Business:

    Offer Price: $

    % Buyer Cash Down at Closing: $

    % Seller Carry Back via Promissory Note: $

    year term at a rate of %

    % of Purchase Price secured by Buyer and Seller

    Total Bank Loan Need: $

    % of Purchase Price

    Desired Loan Type:

    Desired Bank Terms: year term at a rate of %

    Total Business Assets, Inventory, and A/R: $

    Total Undercollateralized Loan: $

    Loan Payments

    Monthly Payment to Bank: $
    Yearly Payment to Bank: $
    Monthly Payment to Seller: $
    Yearly Payment to Seller: $
    Total Monthly Debt Service: $
    Total Yearly Debt Service: $

    Conclusions

    Fixed Charge Coverage Ratio

    The bank will require a minimum ratio of 1.5 to be lendable.

    Cash Flow:
    2-year average cash flow
    $
    Annual Debt Service: $
    RATIO:

    Buyer's Net Operating Income (NOI)

    The amount of money the Buyer will retain as profit.

    Cash Flow:
    2-year average cash flow
    $
    Annual Debt Service: -$
    NOI:

    Buyer's Return on Investment (ROI)

    The rate of return on the Buyer's down payment.

    Down Payment: $
    NOI:
    ROI: %

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    210 N 78th St. 2nd Floor
    Omaha, NE 68114

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    The Firm is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.