New Deals: A commercial cleaning business, package of two car washes, and 3 other finds

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NEW DEALS

1/ Commercial Cleaning Business

📍 Location: New York
💰 Asking Price: $2,200,000
💼 EBITDA: $597,759
📊 Revenue: $1,342,804
📅 Established: 1989

💭 My 2 Cents: If the holy grail of boring businesses are those with ongoing long-term contracts and stable revenue, then commercial cleaners definitely fit the bill. This cleaner has been in business for over 35 years, has an amazing 95% client retention rate, and, as you’d probably assume, a strong local reputation. I like how diversified their offerings are, with services ranging from carpet cleaning to property management services (which now accounts for 15% of their revenue). This means they aren’t too reliant on any one stream of revenue, and that they still have room to grow. I also like that they have a 30-person team and two managers that plan to stay on post-acquisition, a solid asset base of specialized equipment, great margins, and glowing Google reviews. However, I’d want to know whether their margins or cost structure has changed significantly in the past five years, the revenue breakdown between their different service lines, how the retention rate is tracked, what services are offered one-off or on long-term contracts, and more specifics on the included FF&E. I’d also want to understand how reliant the business is on the current owner (especially with landing new contracts).

2/ Package of Two Car Washes

📍 Location: California
💰 Asking Price: $1,650,000
💼 EBITDA: $900,000
📊 Revenue: $1,800,000
📅 Established: 2015

💭 My 2 Cents: Car washes are generally great boring businesses with high margins and consistent demand. This package is for two complementary facilities at a single location in Palm Springs: a car wash detail center and an express car wash tunnel. In addition to their prime location, other real positives include their efficient and profitable operation, favorable lease terms, and the $1M in FF&E included in the purchase price. What jumps out here, though, is the relatively low asking multiple, which could represent a really nice buy opportunity. However, in diligence, I’d want to understand why this is the case. So, I’d need to see detailed financials for the past five years to verify the consistency of their earnings and I’d be curious about the revenue breakdown between their two different services. I’d also need to know how much competition they face in their area, their current utilization rates and if they can handle more business with their current equipment, and the roles and responsibilities of both their staff and owner. The seller is listed as absentee, so this could be an attractive asset for a remote new owner or investor.

3/ Private Household Staffing Company

📍 Location: N/A
💰 Asking Price: $2,400,000
💼 EBITDA: $600,000
📊 Revenue: $2,000,000
📅 Established: 2000

💭 My 2 Cents: The private staffing industry is expanding at a solid 6.4% CAGR, driven by the growing wealth of dual-income households and increased demand for specialized domestic staff in affluent communities. This Northeast-based business specializes in placing private household staff, including nannies and estate managers, for affluent clients. I love their stellar reputation, as affluent, dual-earner families are a tricky demographic to break into, but once you do, they are consistently profitable. I also like how the owners and staff work remotely, providing a low overhead and the ability to scale without increasing fixed costs. I’d want more detail on what percentage of their placements are temporary versus long-term, how they bill for their services, how they source both new placement staff and clients, if there are any compliance measures involved in running the business, and how important the owners are to day-to-day operations.

4/ Stone Veneer Manufacturer

📍 Location: Tennessee
💰 Asking Price: $6,000,000
💼 EBITDA: $1,509,209
📊 Revenue: $4,969,192
📅 Established: 2009

💭 My 2 Cents: This company produces authentic stone veneer products for commercial and residential applications (think everything from fireplaces to retaining walls). Their extensive product line includes thin-cut materials such as limestone, granite, and fieldstone that offer a cost-effective alternative to traditional stone applications. They have a lot going for them as they operate out of a 19,000 sq ft facility (for sale separately), enjoy strong distribution networks nationwide, and have averaged impressive 38%+ margins the past 3 years. I also really like the $2M of FF&E and $500K of inventory included in the sale. However, I’d need to check on the condition of this equipment and the projected use of the inventory. I’d also want to explore how diversified their client base currently is and if there are any concentration issues, how reliant they are on specific suppliers for raw materials, if there is anything proprietary that they produce, who their main competitors are, and the qualifications and experience of their staff. If that all checks out, then this could be a solid deal with the seller offering up to 30% financing and being open to staying on in a sales role.

5/ Specialty Construction Company

📍 Location: California
💰 Asking Price: $2,490,000
💼 EBITDA: $753,766
📊 Revenue: $4,692,858
📅 Established: 1961

💭 My 2 Cents: With over 60 years of experience, this contractor specializes in commercial and industrial construction, serving industries like food manufacturing, oil and gas refineries, and multi-family housing. I like their 200+ general contractor and developer clients (with none representing more than 10% of sales), fully staffed team, and extensive amount of equipment that comes in the sale (check condition!). This type of business requires a Contractor License to operate, so it can be a real advantage to a new owner that the seller is willing to use their license to qualify the company for up to the maximum 12 months allowed by the SBA. The seller is also open to training a new owner in the technical aspects of the business, even if they don’t have a background in the industry. I’d need to get a handle on how much work they now have in progress or on backlog, their level of repeat business, how they bring in new jobs, and how they differentiate themselves from their main competitors. Ultimately, with the projected need for new construction in the LA area, this business should have no trouble finding significant work for the foreseeable future.