New Deals: A pest control company, restoration business, and 3 other finds

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NEW DEALS

1/ Pest Control Company

📍 Location: Madison, Connecticut
💰 Asking Price: $2,000,000
💼 EBITDA: $675,000
📊 Revenue: $1,800,000
📅 Established: 2017

💭 My 2 Cents: This highly profitable mosquito and tick control company has been a top performer in its franchise network for revenues, new customers, and average price per treatment. In business since 2017, they have carved out an excellent reputation as seen with their 150+ 5-star reviews on Google. I especially like their high 70% customer retention rate, as they are in a business that really should have customers come back year after year. I also like that they currently only do outdoor pest control, so you could scale by expanding their services to include perimeter pest control and the treatment of household pests. Finally, it's also nice that they have the support of a franchiser, as they will typically assist with marketing, branding, management advice, hiring, and operational know-how. However, it’s extremely important you understand exactly what the franchise agreement consists of, what charges are involved, what support can be expected, and what limitations exist around expanding your territory or eventually selling. I’d also need to get a handle on any licensing requirements, the qualifications and experience of their staff, who their main competition is, and how they win new clients. If the franchise details look good, this could be a nice turnkey business with a lot of upside potential.

2/ Restoration Business

📍 Location: Miami-Dade County, Florida
💰 Asking Price: $4,650,000
💼 EBITDA: $801,411
📊 Revenue: $2,595,404
📅 Established: 2013

💭 My 2 Cents: I like the restoration sector a lot. It provides a very essential service, is consistently in demand, and has a lot of different avenues of lead generation. This particular emergency restoration business specializes in fire, smoke, water damage, and mold remediation services. And their south Florida location (unfortunately for those involved) means there should be a consistent need for their services due to climate change. The business operates semi-absentee with a well-trained team of bilingual managers and staff that will stay on post-sale, while their strong revenues are supported by their relationships with major insurance companies and a steady flow of referrals from public adjusters and contractors. I’d want more details on their relationships with the insurance companies, to include how these contracts work, and I’d want to know how much of their work is from referrals as opposed to directly sourced from businesses or homeowners, how much competition they face, and how they set themselves apart in gaining new business. I’d also want more detailed information on their current jobs and contracted backlog, the roles and responsibilities of their staff, if they subcontract any work, what the owner does day-to-day and what would be involved in replacing them, and the nature and condition of the $200K in FF&E and $160K in inventory included in the sale. If that all checks out, then you can pick up a nice business that comes with over $6.3M in receivables.

3/ Commercial Cleaning Company

📍 Location: N/A
💰 Asking Price: N/A
💼 EBITDA: $2,000,000
📊 Revenue: $9,000,000
📅 Established: N/A

💭 My 2 Cents: This company provides a wide range of cleaning services to an impressive 165 clients. I really like how they specialize in the cleaning of medical facilities and construction sites, as these clients represent a very steady demand for their services. I also like that they are certified to provide medical disinfection services to hospitals, with this representing a nice barrier to entry to potential competitors, that an absolutely awesome 97% of their revenue comes from repeat clients, and that they are steadily growing, adding 35 new clients in 2024 as of July. Two initial questions I’d want to ask are when were they founded and, given their strong numbers, why are they selling now? I’d then want to look at the revenue breakdown across their different services for the last three years and investigate why their earnings dipped from 2022 to 2023. I’d also want to look into their client retention rate, any possible client concentration issues, the terms of their standard contracts, the size and roles of their staff, the FF&E included in the sale, and the status and condition of their facility. Finally, I’d want to check on the owner's role, the transition plan, and what would be needed in terms of staffing or equipment to support expansion.

4/  Security Door Company

📍 Location: Stanislaus County, California
💰 Asking Price: $1,750,000
💼 EBITDA: $650,000
📊 Revenue: $2,775,000
📅 Established: 1999

💭 My 2 Cents: Security has always been important to homeowners and businesses, but it’s especially important today, so the industry shouldn’t suffer from a lack of demand. This particular company has carved out a niche specializing in the sale and installation of security doors. Their positives include a proven track record over 25 years, a solid customer base, a skilled team, and a location in a thriving market. I’d want to dig into the key drivers of their business, if they market primarily to builders or homeowners, and the revenue split between commercial and residential clients. I’d also need to understand the level of competition they face, how they differentiate themselves in acquiring new business, the extent of their repeat business, their reliance on the current owner, and the proposed transition plan. Finally, I’d like to explore opportunities to expand their services or geographic reach. With all the needed equipment and inventory in place, this could be a foundational turnkey business with real upside potential.

5/ Specialized Trucking and Logistics Company

📍 Location: DuPage County, Illinois
💰 Asking Price: $2,500,000
💼 EBITDA: $912,802
📊 Revenue: $17,800,592
📅 Established: 2014

💭 My 2 Cents: This trucking and logistics company undertakes jobs ranging from hauling ammunition for the government to moving robotics equipment for Amazon. With a fleet of some 75 trucks, they have established a strong reputation for handling hazardous materials and high-value shipments. I like their specialized capabilities as there is a lot of competition in the logistics space, so having a unique skill set, like the ability to transport dangerous cargo, can really set you apart. I also like their government contracts, as these can be very sticky. However, I’d want to better understand the revenue breakdown between their different types of shipments, their standard contracts, typical sales cycle, who their main competitors are, and what is involved in winning new business. I’d also need to ask about how they handle their leased trucks and contract drivers, if there are any special licenses or certifications required (especially for hazardous cargo), and what would be involved in scaling their operations to take advantage of possible opportunities to extend into new service lines or geographic areas.