Import, export and distribution
Distribution businesses are valued on relationships at both ends: the suppliers who grant exclusive lines and the customers who reorder. Buyers in BC look hard at concentration, inventory, currency exposure and whether agreements transfer with the company. We help owners document what makes the business durable and structure deals that account for the risks.
How the money works
- Exclusive supplier agreements are the main asset and may not transfer automatically
- Customer concentration is common and discounted heavily unless contracts are in place
- Inventory and receivables tie up cash, so working capital is large and the peg matters
- Currency, freight and tariff changes move margins outside the owner's control
The moves we make
- Audit supplier agreements for change-of-control and exclusivity terms before listing
- Value on normalised margins with concentration and currency risk made explicit
- Set the working capital peg and inventory rules early to avoid closing disputes
- Prepare financing that reflects inventory and receivables realistically
Supplier agreements decide the deal
The first question a buyer asks about a distributor is whether the lines come with it. An exclusive agreement that ends on a change of control is a liability in disguise. We read every supplier agreement for assignment, exclusivity, minimums and termination before the business goes to market, and we involve the key suppliers at the right moment, with the owner, so the buyer and lender know the lines transfer. Where an agreement is weak, we price for it or fix it first.
Working capital in distribution
Distributors carry inventory and receivables that can exceed the value of the business itself, so the working capital mechanics in the deal decide what the owner actually nets. We set the working capital peg from a normalised trailing average, agree how inventory is counted and valued, exclude obsolete stock and define how receivables are collected after closing. Buyers in BC usually want asset deals here to choose what they take. Your CPA models the tax consequence of each structure before you choose.
Newcomer buyers and international owners
Many investors entering Canada look at import and distribution businesses because the model is familiar and relationships in their home market can add real value to a BC company. The business advisory is the same as for any buyer: criteria, valuation, diligence, structure and financing. Immigration questions always sit with a regulated immigration consultant or lawyer, and we work alongside them. Customs, tariff and trade compliance questions go to a licensed customs broker or lawyer. We run the business side of the transaction.
Questions from import, export and distribution owners
How is a distribution business valued?
On normalised earnings, with the multiple reflecting supplier exclusivity, customer concentration and how transferable the agreements are. Inventory and working capital are handled separately through the peg.
What if one customer is most of my revenue?
Buyers will discount for it. A written contract, a long history and a diversified pipeline reduce the discount. Starting to diversify years before a sale is the best fix.
Do you handle customs and trade compliance?
No. Those questions go to a licensed customs broker or a trade lawyer. We handle the valuation, sale, purchase and structure of the business and coordinate with them.
Start with a confidential conversation.
Tell Ali where the business is and what you want to happen next. You leave with a straight read on value, timing and the two or three moves that matter, whether or not we work together.