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Commercial Roof Contracting Biz w/ $617K Annual SDE 🔨

Under the Radar Weekly Deals

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👋 Hey fellow searchers,

Welcome to issue #18 of Under the Radar!

Let’s get right into it.

This week’s issue features:

  • 🚪 Garage door retailer & installer w/ $3.85M revenue

  • 🔨 Commercial roof contracting biz w/ $617K annual SDE

  • 🏊🏼‍♂️ Pool construction co. selling at 2.1x annual cash flow

Hot Deals 🔥

Analyses of the best deals we found across top marketplaces and brokerages.

#1. Garage door retailer & installer w/ $3.85M revenue

🏷️ Asking Price: $1,990,000

📍 Location: Suffolk County, NY

Overview: This long-established and profitable garage door retailer and installer is up for sale as the current owner is seeking retirement. The business has seen growth in sales and profits over the past two years post-pandemic. It has a strong management team and experienced staff, most with over 10 years of tenure, ensuring continuity and smooth operations. The seller will provide 3 weeks of training and SBA financing is available up to $1.9M for qualified buyers.

Key Highlights

  • ~$3.85M annual revenue

  • ~$720K annual SDE

  • $150K inventory (not included in asking price)

  • $100K FF&E (included in asking price)

  • 9 employees

Growth Avenues 🚀

  • Enhancing digital marketing efforts, including SEO, social media advertising, and online reviews, can boost the business’s visibility and attract more residential customers

  • Securing long-term contracts with businesses, property managers, and real estate developers can provide steady and predictable revenue streams

Potential Risks 🚩

  • The presence of other established garage door retailers and installers in the area could limit growth potential and lead to price competition

  • A recession or economic slowdown could reduce consumer spending on home improvements, affecting sales and profitability

Questions❓

  • What is the current condition and age of the equipment and inventory? Are there any major upcoming capital expenditures needed for replacements or upgrades?

  • How diversified is the customer base? Is there a heavy reliance on a few key clients, or is the revenue evenly distributed?

  • What are the terms and durations of existing contracts with commercial clients? Are they transferable to the new owner?

#2. Commercial roof contracting biz w/ $617K annual SDE

🏷️ Asking Price: $1,295,000

📍 Location: West Palm Beach, FL

Overview: This 50-year-old commercial roofing contracting business specializes in single-ply membrane roofing and has long-term relationships with major general contractors. The business primarily works with public entities, including Target, Walmart, banks, school boards, local municipalities, shopping centers, and large warehouse developers in Palm Beach, Broward, and Miami-Dade counties. One partner is retiring, while the other will stay on with an employment agreement for six months to a year post-closing. This turnkey operation has rebounded strongly post-pandemic, demonstrating solid profitability and growth, making it an attractive opportunity for a new owner to benefit from its established reputation and client base.

Key Highlights

  • ~$2.64M annual revenue

  • ~$617K annual SDE

  • $164K FF&E (included in asking price)

  • Millions of contracted WIP/backlog

  • 14 employees

  • 30 days of training & support

Growth Avenues 🚀

  • Strengthen and expand existing relationships with public entities and pursue additional contracts with government organizations

  • Offer additional roofing services, such as maintenance programs, emergency repair services, and other complementary services

Potential Risks 🚩

  • The roofing industry faces skilled labor shortages, which could impact the ability to complete projects on time and within budget

  • Fluctuating prices for roofing materials could affect profit margins, particularly for long-term contracts

Questions❓

  • What are the terms and durations of existing contracts with public entities and major clients? Are these contracts transferable to the new owner?

  • What measures are in place to retain key employees post-sale, and are there any key employees considering retirement or departure?

  • What is the nature of the business’s relationships with general contractors? Is the current owner the sole point of contact, or are these relationships maintained by other key employees?

#3. Pool construction co. selling at 2.1x annual cash flow

🏷️ Asking Price: $1,400,000

📍 Location: Austin, TX

Overview: This established pool construction company specializes in luxury pool design and construction. With over 20 years in business, it is known for high-quality, customized in-ground pools and spas, leveraging advanced 3D design and gunite installation techniques. The owner is retiring and the business has been SBA pre-approved. Training and support will be available for up to 4 weeks.

Key Highlights

  • ~$3.2M annual revenue

  • ~$658K annual SDE

  • SBA pre-approved

  • Experienced technicians

Growth Avenues 🚀

  • Adding maintenance and repair services can create a recurring revenue stream and deepen customer relationships

  • Investing in digital marketing, social media presence, and local advertising to attract new customers and increase market share

Potential Risks 🚩

  • The business’s performance is closely tied to the economic conditions and housing market health

  • The skilled labor market for construction trades can be tight, potentially affecting project timelines and quality

Questions❓

  • What is the revenue breakdown by service type (e.g., new constructions, renovations, add-ons)?

  • How does the company source its materials, and are there any exclusive supplier agreements?

  • What are the specific roles and responsibilities of the full-time and part-time employees?

Radar Picks 📡

Bit-sized reads featuring insights and fresh perspectives

Tweet of the Week 🐦

This week’s featured tweet comes from Clint Fiore. It breaks down the essentials of valuing a Main Street business, highlighting crucial metrics and valuation methods that every prospective buyer should understand. Perfect for those diving into the world of small business acquisitions and looking to grasp the fundamentals of business valuation👇

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DISCLAIMER: This newsletter is for informational purposes only and should not be considered financial advice. It offers analyses of businesses without endorsing any specific financial actions. Readers are advised to do their own research and consult a professional before making investment decisions.