Business Overview

This company has been providing plumbing, piping and gas services to industrial, commercial and residential customers for over 25 years. They are known for their quality work, their reliability, and their outstanding customer service.

Investment Considerations for a Buyer

1. The company has a solid customer base with almost all business coming from existing customers.
2. The company possesses excellent relationships with general contractors.
3. The owners are willing to stay on for a defined period of time as needed.
4. This is a perfect opportunity for someone with plumbing experience to own their own business.
5. Owners’ average compensation for last five years is $261K.
6. Inventory, FFE and six vehicles are included in the asking price.

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REVENUE
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2020 — $841,178

2019 — $661,739

2018 — $736,505

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This acquisition would be an extremely desirable opportunity for a general contractor or other mechanical contractor to add on to their business or for a piping/plumbing company in a nearby county wishing to expand their territory. Experience in construction, plumbing/piping or a related business is preferred.

Financial

  • Asking Price: $449,000
  • Cash Flow: N/A
  • Gross Revenue: $841,179
  • EBITDA: N/A
  • FF&E: $90,000
  • Inventory: $50,000
  • Inventory Included: Yes
  • Established: 1995

Detailed Information

  • Property Owned or Leased:N/A
  • Property Included:N/A
  • Building Square Footage:N/A
  • Lot Size:N/A
  • Total Number of Employees:3
  • Furniture, Fixtures and Equipment:N/A

Additional Info

The business was established in 1995, making the business 27 years old.
The sale will include inventory valued at $50,000, which is included in the requested price.

Why is the Current Owner Selling The Business?

There are all kinds of reasons people choose to sell businesses. Nevertheless, the genuine factor vs the one they say to you may be 2 completely different things. As an example, they may state "I have a lot of various commitments" or "I am retiring". For many sellers, these factors are valid. But, for some, these may just be justifications to try to hide the reality of transforming demographics, increased competitors, current reduction in earnings, or a range of various other reasons. This is why it is extremely vital that you not rely entirely on a vendor's word, but rather, use the seller's solution combined with your overall due diligence. This will repaint a much more sensible image of the business's present situation.

Existing Debts and Future Obligations

If the existing business is in debt, which numerous companies are, then you will have reason to consider this when valuating/preparing your offer. Many companies take out loans with the purpose of covering things like supplies, payroll, accounts payable, and so on. Bear in mind that in some cases this can suggest that earnings margins are too thin. Lots of companies fall under a revolving door of taking loans as a way to pay back other loans. Along with debts, there may likewise be future obligations to think about. There may be an outstanding lease on equipment or the structure where the business resides. The business may have existing contracts with vendors that have to be met or might cause charges if terminated early.

Understanding the Customer Base, Competition and Area Demographics

Just how do businesses in the area attract brand-new consumers? Most times, companies have repeat consumers, which form the core of their daily revenues. Certain aspects such as brand-new competitors sprouting up around the area, roadway construction, and also staff turnover can influence repeat customers and also negatively affect future revenues. One vital thing to take into consideration is the area of the business. Is it in a highly trafficked shopping mall, or is it hidden from the highway? Obviously, the more people that see the business often, the greater the opportunity to build a returning consumer base. A last idea is the general area demographics. Is the business located in a largely populated city, or is it located on the outside border of town? Exactly how might the regional median house income effect future revenue prospects?