Established Custom Packaging Manufacturer, ~40-Year Suffolk County NY Operation

$4.2M

Revenue

$522K

SDE

3.5x

Multiple

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Full Editorial Writeup

This is a custom packaging manufacturer with roughly four decades of operating history, producing corrugated, foam, and display packaging for a diversified base of packaging, medical device, retail display, and industrial customers. Approximately 95% of production is custom order work, which means the business competes on capability and relationships rather than commodity pricing. The sale includes the full account list, production equipment, and an experienced retained team spanning sales, operations, and skilled machine operators.

The listing frames this as a plug-and-play bolt-on for an existing operator seeking additional capacity, and that framing is accurate. The operation only requires about 5,000 square feet to absorb, which is unusually compact for a manufacturer at this revenue level and points to either efficient equipment or a relocatable footprint. Roughly $283K of inventory is available on top of the asking price, so the effective all-in cost is higher than the headline $1.83M.

Financials show some softness worth noting. Revenue slid from $4.50M in 2024 to $3.96M, then annualized back to $4.15M, and adjusted EBITDA swung from roughly $700K down to $447K before recovering to a $588K run rate. Gross margin also compressed from 37.8% to the mid-34% range. This is a durable niche business with real customer stickiness, but the recent trend line is not a straight climb and the buyer needs to understand what drove the dip.

Why we like it

Earnings quality is anchored by nearly 40 years of operating history and long-standing customer relationships with strong repeat-order history. At $522K SDE on $4.15M revenue against a $1.83M ask, the 3.5x multiple is reasonable for a manufacturer with an installed base and a retained team. The medical device and industrial customer exposure adds diversification beyond pure retail.
The moat here is custom capability, not price. With 95% of production being custom order work across corrugated, foam, and display, customers embed this shop into their own product specs and supply chains, which raises switching costs and protects margin. A commodity box maker gets shopped on price every quarter; a custom spec partner does not.
Packaging demand tracks the essential activity of shipping physical goods, medical devices, and industrial products, which holds up better in a downturn than discretionary consumer categories. The diversified customer base across four end markets reduces reliance on any single sector or client. That mix is a real buffer against any one vertical slowing.
This is structured as a genuine bolt-on for an existing operator. The business only needs ~5,000 sq ft to absorb, the equipment and skilled team come with it, and an acquirer with existing capacity could layer these accounts onto their own overhead. For a strategic buyer, the accretive math on absorbing this book could push the effective multiple well below 3.5x.

How to improve it

Diagnose and reverse the revenue and margin dip immediately. Revenue fell from $4.50M to $3.96M and gross margin compressed from 37.8% to the mid-34s before recovering, so identify whether the softness was lost accounts, input cost inflation, or a one-off. Rebuilding to the 2024 baseline is the single highest-leverage move in year one.
Institute a formal pricing and quoting discipline on custom work. In a 95% custom shop, margin lives and dies on how jobs are quoted, so audit recent quotes against actual production cost and material waste. Recovering even 200 basis points of gross margin on $4.15M is over $80K straight to EBITDA.
Build repeat-order stickiness into contractual programs. The business already has strong repeat-order history, so convert the top accounts into blanket purchase orders, min-volume commitments, or scheduled release agreements. This turns implied loyalty into contracted revenue and materially de-risks the customer concentration.
Cross-sell the medical device and industrial base on higher-margin display and foam work. Retail display packaging and protective foam typically carry richer margins than commodity corrugated, so map which existing customers buy only corrugated and pitch the fuller capability set. Wallet-share expansion is cheaper than new logo acquisition.
Tighten inventory management given the $283K carve-out. Since inventory is priced separately and sits at meaningful scale relative to revenue, build a turns dashboard and cut slow-moving stock. Freeing working capital here directly improves cash-on-cash returns for the buyer.
Formalize the sales function beyond owner and legacy relationships. Nearly four decades of relationships often means concentration in a few long-tenured contacts, so document accounts, add a CRM, and put a repeatable outbound motion on new customer acquisition. This protects the base and creates a growth engine the prior owner may have neglected.

Diligence notes

Interrogate the revenue and EBITDA volatility hard. Revenue moved $4.50M to $3.96M to a $4.15M run rate, and adjusted EBITDA swung from ~$700K to $447K to ~$588K, so get monthly financials and a customer-level revenue bridge. You need to know whether the dip was a lost account, a demand cycle, or margin pressure, because it changes the valuation entirely.
Quantify customer concentration despite the diversified framing. The listing touts a diversified base across packaging, medical, retail, and industrial, but verify what percentage of revenue the top five accounts represent. A single large medical device or retail customer walking after close could break the model.
Reconcile the reported cash flow figures. The headline SDE is $522K but the financial summary cites Adjusted EBITDA figures of $699K, $447K, and $588K across three periods, so pin down exactly which number the multiple is built on. Scrutinize every add-back and confirm the maintainable earnings level before pricing an offer.
Verify the condition, age, and transferability of the production equipment. The equipment is included and the buyer needs only 5,000 sq ft, so inspect the machines, confirm remaining useful life, and estimate near-term capex. Aging custom packaging equipment can carry deferred maintenance that the sale price does not reflect.
Confirm the team actually stays post-close. The thesis relies on retaining sales, operations, and skilled machine operators, so review employment terms, tenure, and any key-person risk. In a 95% custom shop, the machine operators and estimators are the business, and their departure would erase much of the value.
Clarify the real estate and relocation situation. The listing notes the operation only requires ~5,000 sq ft to absorb, which implies the buyer may need to move it or assume a lease, so confirm whether there is an existing lease, its terms, and the cost and risk of relocating equipment and production.

Source

Originally listed on BizBuySell. View original listing →