Introduction:
Teuer Furniture is an upscale home furnishing showroom chain within the United States.
In 2012, the privately owned company was financially secure and some of its investors
were interesting in selling their shares back to Teuer. Since Teuer is a private business,
calculating valuation is much more difficult than its public counterparts; therefore, there
was no valuation established at this point in time. In order to decide how the company
should finance the investor buyout, Teuer’s directors found it necessary to develop a
valuation of the business. Teuer’s Chief Financial Officer, Jennifer Jerabek, and the
company’s team of financial advisors main objective were to produce forecasts in which a
valuation and stock price would be based upon. Once completed, the business could
perform the correct strategy for the investor buyout.
Teuer was created in 2003 by two individuals who previously worked in the retail industry,
Kim Smithson and Scott Casper. They focused on selling high-quality designer furniture to
high-income earners. The two founders wanted to open up their new furniture store outside
of big cities.
Smithson worked in the retail sector. Her first job after graduate school was with Jennifer
Convertibles. There she worked several management roles. This allowed her to become
familiar with all aspects of the firm’s retail operations. This knowledge will help Teuer
Furniture have great success.
Casper worked in consulting and industry roles. His position at Heilig-Meyers, the largest
furniture retailer in the mid-90s, allowed him to network with many furniture
manufacturers which will help Teuer furniture start and grow quickly. Additionally, he
learned suppliers operational and financial constraints.
Products offered. Teuer does not manufacture own products. All products high end and
marketed to upper-income individuals. For all rooms in the house. American Made: made
through companies that Casper had networked with in his previous job.
Teuer’s philosophy was “Helping a friend furnish their home.” This gained them great
success. Teuer spent a lot of money to heavily train their sales team. “Please don’t feel any
pressure to make a decision. We trust you will be back when you are ready.” This approach
lead to low sales in year 1. But lead to drastic increase in sales after year 1 by repeat
customers and friends of past customers, Peterson, 3.
Teuer has 29 Locations located outside of big cities in Midwest. Peterson noted Teuer
focused on opening located in second tier cities in terms of population (i.e. St. Louis and
Des Moines). Their showrooms are laid out to represent rooms in a house. Critical
