How can I judge how much of a frame shop’s work comes from corporate decor jobs?
Ask the owner to split recent jobs into corporate decor, retail walk-in and artist or gallery work, by count of jobs and by revenue. Then look at who placed the corporate orders, how often they return and whether they are one-off fit-outs or ongoing accounts.
Corporate decor can be lumpy. A single office fit-out may fill the shop for weeks and then vanish. Ask for invoices grouped by customer type and by month, and look for patterns rather than a few large tickets. Notice whether the same designers or procurement contacts keep coming back.
Find out how those jobs are won. Some come through interior designers, some through direct relationships with an office manager, some through bids. If the owner built the relationships personally, consider how they might continue with you. Ask whether anyone at the shop manages these accounts day to day.
Look at the practical side too. Large jobs can tie up stock, labour and cash if the client pays slowly. Ask about payment history and any outstanding invoices. Your accountant can help you read what the statements show about these accounts, and what working capital the shop needed to carry them. Ask whether the corporate side has a different pace than retail work. Larger jobs often mean installation, delivery and longer lead times, which may need a vehicle and a second pair of hands. Consider whether you want this kind of work, or would rather build the walk-in side. Ask for a few recent examples of each kind of job, start to finish.
Key takeaways
- Split recent jobs into corporate, retail and gallery work, by revenue.
- Ask how corporate jobs are won and whether they repeat.
- Check payment timing and outstanding invoices on large accounts.
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Due diligence
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Business Development Bank of CanadaGovernmentUnderstanding post-merger operational integration
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