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Home remodeling company w/ $900K annual SDE 🧰
Under the Radar Weekly Deals
The #1 Boring Biz Newsletter
👋 Hey fellow searchers,
Welcome to issue #28 of Under the Radar!
Let’s get right into it.
This week’s issue features:
🌳 Full-service landscaping biz w/ $3.3M annual revenue
🧰 Home remodeling company w/ $900K annual SDE
🚙 Online performance auto parts biz w/ a 65% repeat customer rate
Hot Deals 🔥
Analyses of the best deals we found across top marketplaces and brokerages.
#1. Full-service landscaping biz w/ $3.3M annual revenue
🏷️ Asking Price: $1,200,000
📍 Location: Wayne County, MI
Overview: This well-established, full-service landscaping company has been operating for over 30 years, offering installation, irrigation, and over-the-counter nursery sales to both commercial contractors and the public. With three experienced crews and a backlog of projects through 2024, the business is positioned for continued success. The seller is motivated to retire and will stay on for up to a year to ensure a smooth transition. Real estate, valued at $1.5 million, is not included in the asking price but is available for sale or lease.
Key Highlights ✅
~$3.3M annual revenue
~$528K annual SDE
$720K FF&E (included)
$300K inventory (not included)
26 employees
Growth Avenues 🚀
Currently, the business has no sales force and minimal advertising. Investing in a dedicated sales team and a targeted marketing strategy (digital ads, social media, and SEO) could substantially increase visibility and client acquisition.
There appears to be room to increase prices, especially given the backlog of jobs and strong demand from the local upscale communities.
Potential Risks 🚩
The company relies on three experienced crews. A sudden loss of key personnel could disrupt operations and project timelines, particularly in a labor-shortage market.
The real estate is not included in the asking price, and purchasing or leasing it adds another financial consideration for the buyer.
Questions❓
What are the terms for purchasing or leasing the real estate, and how flexible are they?
What percentage of revenue comes from commercial vs. residential clients, and how does the customer base break down?
How is the workforce structured, and what is the plan for retaining key employees during the transition?
#2. Home remodeling company w/ $900K annual SDE
🏷️ Asking Price: $2,800,000
📍 Location: Phoenix, AZ
Overview: This Phoenix-based remodeling company specializes in kitchen, bath, and patio renovations, with an additional concrete resurfacing division. Established in 2017, it has rapidly gained a strong foothold in the market due to its proprietary processes that speed up the remodeling timeline with minimal mess. With 36 employees and well-structured departments, the company is primed for growth. The owner is willing to stay on in an advisory role to support the transition.
Key Highlights ✅
~$9.9M annual revenue
~$901K annual SDE
$500K FF&E (included)
$300K inventory (not included)
36 employees (sales, management, etc.)
Growth Avenues 🚀
With the strong housing market in Phoenix, expanding services into nearby areas or states could capture additional customers.
Partnering with real estate developers and contractors for ongoing projects could help secure larger commercial contracts, enhancing revenue streams.
Potential Risks 🚩
Skilled labor in remodeling is in high demand, and retaining key employees could be a challenge, particularly in a competitive market like Phoenix.
With $300,000 in inventory not included in the asking price, the buyer would need to account for the additional upfront cost to maintain operations smoothly.
Questions❓
How does the company manage its relationship with subcontractors, and what percentage of work is outsourced, if any?
What are the biggest challenges in scaling operations, and how has the business managed past growth surges?
How have material cost fluctuations impacted profitability, and what strategies are in place to manage these costs?
#3. Online performance auto parts biz w/ a 65% repeat customer rate
🏷️ Asking Price: $6,360,000
📍 Location: Colorado
Overview: This well-established e-commerce business, operating for over 20 years, sells performance auto parts through multiple branded websites. The company focuses on universal parts for cars, trucks, boats, and niche vehicles, most of which are manufactured overseas under its own house brands. With a 14,000 sqft. warehouse and a full team of employees handling operations, it has a strong base of repeat customers and no reliance on any single client. The current owner is hands-off, working less than an hour a day, making it ideal for a remote operator or acquisition.
Key Highlights ✅
~$3.70M annual revenue
~$1.38M annual SDE
$50K FF&E (included)
$800K inventory (included)
65% of orders from repeat customers
Served 200,000+ customers
7 employees
Growth Avenues 🚀
Developing a mobile-friendly interface for the company's websites could improve customer experience and increase sales from mobile users.
The company’s product offerings have remained relatively stagnant. Expanding the catalog with new items could capture more market share.
Potential Risks 🚩
The company outsources its manufacturing to overseas factories. Any disruptions in these supply chains could impact inventory availability and profitability.
While the current owner spends minimal time managing the business, a new buyer might need more hands-on involvement initially to sustain or grow operations.
Questions❓
How is the business's inventory turnover managed, and what is the average holding period for stock?
What are the details of relationships with overseas manufacturers, and are there any backup suppliers in case of disruptions?
How are website performance and online customer service monitored and maintained?
Other Hot Deals 🔥
Radar Picks 📡
Bit-sized reads featuring insights and fresh perspectives
Tweet of the Week 🐦
This week’s featured tweet from Mitchell Baldridge highlights how owning a small business unlocks major tax benefits, from deductible expenses to employment tax savings through S-Corps. Check out his thread for tips on maximizing tax savings and building wealth.👇
Owning a small business is the best tax deal in America.
Whether it's a $10K side hustle or $10MM business, earning business income opens up amazing opportunities for tax savings and wealth creation.
Let’s walk through how it works:
— Mitchell Baldridge (@baldridgecpa)
1:50 PM • Aug 25, 2024
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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.