South Central Iowa SBDC Assists Owner with Purchase of Paper Distribution Company
Pat Loudon was in search of a business opportunity in early 2008 when he initiated discussion about the acquisition of BM Sales, a privately owned paper distribution business. Loudon had lost his job after the closing of his former employer, Wausau Homes of Corning.
Ironically, when Loudon headed to meet with Dave McLaren at the South Central Iowa SBDC office in Creston about becoming a small business owner, he had no idea that the previous owner would also be contacting McLaren regarding his potential sale.
The owner was interested in selling and Loudon was interested in purchasing, but neither party felt qualified to name the purchase price. In the end, following confidential individual meetings with each party and a joint meeting to make everyone aware of the others' intentions, McLaren was able to act as mediator between the two parties who soon entered into a purchase agreement.
McLaren then worked with Pat and his wife, Korina, to secure an SBA 7(a) guaranteed loan through a local bank. As a result, Pat and Korina became the owners of BM Sales in May 2008.
Based out of a warehouse at 107 West Montgomery, BM Sales is a distributor of paper products including copy paper, colored paper, paper towels, roll towels, toilet paper, cleaning products, can liners, etc.
Pat felt he was at an advantage by having the former owner accessible and willing to assist with the business changeover. "He (the former owner) actually rode with me during my first two months," stated Pat. During that time, Pat was able to meet clients, learn first-hand knowledge of the business, and transition smoothly into the role of business owner.
Pat continues to meet with McLaren at the SBDC office on a regular basis. Pat explained he suffers from rheumatoid arthritis. Due to having a disability, McLaren has assisted in accessing funds and services for business owners with disabilities.
"He's aware of things (financial and other assistance for business owners) I'm totally unaware of," explained Pat. Examples of potential business assistance options McLaren is helping Pat apply for include Vocational Rehabilitation funds and the state of Iowa's Targeted Small Business Program.
Pat is grateful for the advice McLaren provides for him and feels the SBDC provides a great deal of expertise to business owners. "Before meeting with Dave, I really didn't know anything about the SBDC," Pat said. Now he appreciates having someone to look to for advice.
One of the Loudon's business goals for the coming months includes the creation of a company Web site. McLaren is assisting with the planning for this. Once the Web site is up and running, Pat will be able to process orders while he is meeting with customers. Customers will also be able to place orders directly through the Web site.
BM Sales has been in business since April 1992 when the former owner started the business out of his home. Pat spends a great deal of his time on-the-road making calls, but can be reached at 641.782.2414.