New Deals: A pool maintenance business, commercial plumbing contractor, and 3 other finds

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NEW DEALS

1/ Pool Maintenance Business

📍 Location: Broward County, Florida
💰 Asking Price: $2,100,000
💼 EBITDA: $700,510
📊 Revenue: $3,956,048
📅 Established: 1991

💭 My 2 Cents: As a location for a pool maintenance business, it’s hard to beat Florida where the favorable climate means year-round demand. This particular business focuses on pool and spa repairs, renovations, and equipment installations. I really like their work split of 70% remodeling, 20% repair, and 10% leak detection and that they serve both residential (80%) and commercial (20%) clients. Importantly, they do no new construction so they aren’t as vulnerable to economic slowdowns. I also like how well-built their employee infrastructure is with a sales and operations general manager, mechanics, and subcontracted crews. I’d want to dig into their repeat business, understand what % of their revenue is recurring, and look into local competition in the area. Ultimately, this looks like a great opportunity to get into the pool space with a business that has management in place.

2/ Commercial Plumbing Contractor

📍 Location: Texas
💰 Asking Price: N/A
💼 EBITDA: $914,592
📊 Revenue: $3,863,877
📅 Established: 2016

💭 My 2 Cents: This commercial plumbing business has an impressive client base, with 25 major clients representing 80% of their business. While plumbing will always be an essential service, it can be a lot easier for companies like this with established commercial work to bring in predictable revenues than it is for companies serving primarily residential clients. This business also employs ‘Master Plumbers’, which allows them to perform work in critical environments like hospitals, emergency rooms, care centers, and outpatient facilities. I like the strong margins here, but I especially like that this business has only just established a service department yet expects it to already generate an additional $750,000 in revenue this year. This points to awesome growth potential, especially if they can leverage their current relationships to promote the increased service offerings. I’d want to check their numbers for the last three years to confirm their growth trajectory and I’d need more details on who their main clients are and the types of work they perform for them. I’d also need to look into their client retention rate, what their service contracts look like, how they win new business, the nature and condition of the $250K in FF&E, how much of their skilled technical staff is projected to remain, and what role the owner’s brother-in-law, who now runs the day-to-day operation, would play post-sale.

3/ Staffing Firm

📍 Location: Newark, New Jersey
💰 Asking Price: $7,750,000
💼 EBITDA: $1,910,389
📊 Revenue: $32,621,137
📅 Established: 2012

💭 My 2 Cents: This staffing company specializes in placing W2 employees in industrial and logistics positions across the Northeast. Operating from 6 locations with a dedicated staff of 11, they have completed over 800 placements in a client base that includes Fortune 500 companies. The result is a very profitable business with a strong reputation. I like finding staffing firms that have carved out a niche for themselves, especially when they serve essential industries. I also like that the sellers are open to a two-year transition period and are willing to offer up to 20% financing, which really points to the faith they have in the future of the business. However, I do want to better understand their business model, including how their payments are structured, who their clients typically are, how they identify the talent they place, who their key competitors are, and on what basis they compete for new business. If that all checks out, then this type of business is very scalable, so a new owner could really reap the reward from the company’s pre-existing reputation.

4/ Fencing Contractor

📍 Location: Virginia
💰 Asking Price: $1,400,000
💼 EBITDA: $536,605
📊 Revenue: $3,395,983
📅 Established: 1998

💭 My 2 Cents: I generally like businesses like this fencing company. They aren’t asking a crazy multiple relative to their cash flow, they have an established online presence, they don’t rely entirely on owner relationships and referrals, and they provide a quality service. This particular fencer also has a 25+ year track record, experienced crew and administrative team, tons of 4 and 5 star reviews, and clean books. While things look promising, I’d need to dig into the consistency of their revenues and if there is any seasonality to their workflow, how much work is in the current pipeline or on contracted backlog, if staffing is ever an issue, and, in an industry where there is a lot of competition, how they set themselves apart from their competitors. As the owner is important in handling estimates and vendor/builder relations, I’d also need a handle on a workable transition plan. The owner is willing to offer financing to a well-qualified buyer, so this could ultimately end up as a really attractive deal.

5/ Painting and Restoration Company

📍 Location: Kerrville, Texas
💰 Asking Price: $2,999,000
💼 EBITDA: $918,878
📊 Revenue: $5,155,104
📅 Established: 1987

💭 My 2 Cents: This painting and restoration company has built a stellar reputation over 35 years while catering primarily to municipalities. I like their focus on municipal clients as these contracts, while often hard to secure, can be both very sticky and very lucrative. Reflecting this, the company has averaged over $900K in earnings each of the last four years. And I don’t see why this number can’t grow much higher, as a new owner could leverage this experience and proven track record working with municipal governments into new jobs in neighboring untapped markets. With this business, I’d first want to understand how these municipal contracts typically are structured. I’d also be curious about how they acquire new customers, and if bidding is involved, how much competition they routinely face, and what they win bids over. It appears this business has been very reliant on the current owner (but its earnings and asking price could support a General Manager if there isn't one already), so I'd spend a lot of time discussing what a transition plan could look like. For the right buyer, this could be a very interesting opportunity.