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Party Equipment Rental Biz Selling at 2.7x Cash Flow 🍾

Under the Radar Weekly Deals

The #1 Boring Biz Newsletter

👋 Hey folks,

Welcome to issue #11 of Under the Radar!

Let’s get right into it.

This week’s issue features:

  • 🌳 Full-service landscaping company w/ $1.46M annual SDE

  • 🍾 Party equipment rental biz selling at 2.7x cash flow

  • 🔨 Established roofing company w/ $1.92M annual revenue

Hot Deals 🔥

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

#1. Full-service landscaping company w/ $1.46M annual SDE

🏷️ Asking Price: $3,200,000

📍 Location: Jefferson Parish, Louisiana

Overview: Located in the vibrant and culturally rich area of Greater New Orleans, this established full-service landscaping company offers a turnkey solution for those looking to acquire a foothold in the landscaping industry. With a rich history of providing top-notch landscaping, garden maintenance, and design services, this business has cultivated a strong customer base through exceptional service and reliability.

Key Highlights

  • ~$2.08M annual revenue

  • ~$1.46M annual SDE

  • 1,200 customers (solid retention rates)

  • Experienced team of 12 FTEs (+ 10 contractors)

Growth Avenues 🚀

  • Implementing a robust digital marketing strategy, including SEO (Search Engine Optimization) and social media engagement, could significantly increase visibility and attract new customers

  • Collaborating with other local businesses such as nurseries, home improvement stores, and real estate agencies could open up referral opportunities and broaden the customer base

Potential Risks 🚩

  • The availability of skilled labor can pose a significant challenge, especially during peak seasons. Retention strategies and competitive compensation packages are essential to mitigate this risk

Questions❓

  • What systems are currently in place for managing customer relationships and scheduling services?

  • How does the company utilize contractors in its operations, and what are the terms and conditions of these arrangements?

  • What’s the current client retention rate and the average duration of client contracts?

#2. Party equipment rental biz selling at 2.7x cash flow

🏷️ Asking Price: $1,400,000

📍 Location: New York

Overview: This Party Equipment Rental Service Company, based in the bustling and diverse region of New York, offers a valuable opportunity for those interested in entering the event services industry. Specializing in rentals for various events, the company provides everything from tents and canopies to tables, chairs, and party decor, catering to both private and corporate clients. The business has built a solid reputation for quality and reliability, which has contributed to its consistent year-over-year growth.

Key Highlights

  • ~$2.78M annual revenue

  • ~$526K net cash flow

  • 15+ years of experience

  • Strong industry relationships

Growth Avenues 🚀

  • Revamping the website and enhancing online booking capabilities, along with aggressive digital marketing strategies, could significantly increase bookings

Potential Risks 🚩

  • The demand for party equipment rentals can be highly seasonal, which might affect cash flow during off-peak months

  • Spending on events is often discretionary; thus, economic downturns could lead to decreased demand for rental services

Questions❓

  • How does the company manage its inventory and ensure the quality and maintenance of rental items?

  • How does the company handle off-peak seasons to maintain cash flow and profitability?

  • How does the company utilize contractors, if at all, in its operations, particularly for event setup and logistics?

#3. Established roofing company w/ $1.92M annual revenue

🏷️ Asking Price: $1,200,000

📍 Location: Lucas County, OH

Overview: This Northwest Ohio Roofing Business presents an excellent opportunity for those looking to enter or expand within the construction and home improvement industry. Specializing in residential and commercial roofing services, the company offers new installations, repairs, and maintenance services. Established for over two decades, this business has built a reputation for quality craftsmanship and reliable customer service, supported by a skilled and dedicated team.

Key Highlights

  • ~$1.92M annual revenue

  • ~$588K annual cash flow

  • ~$574K annual EBITDA

  • $94K FF&E included

  • 6 FTEs (+ contractors)

  • A+ BBB rating and 5-star Google Review rating

Growth Avenues 🚀

  • Forming partnerships with real estate developers, architects, and insurance companies could create referral networks and increase project volume through integrated service offerings

Potential Risks 🚩

  • As the industry evolves towards incorporating more sophisticated technologies, the existing workforce may need significant upskilling to stay competitive. This could result in increased training costs and implementation challenges.

Questions❓

  • How does the business handle procurement of materials, and are there preferred suppliers or contracts in place?

  • What training programs are in place for employees, especially concerning new roofing techniques and safety regulations?

  • What marketing strategies is the business currently engaged in?

Radar Picks 📡

Bit-sized reads featuring insights and fresh perspectives

Tweet of the Week 🐦

This week's Tweet of the Week comes from Rory Tyer, an individual who recently closed his first acquisition. After a 2 year search, Rory was able to close on a great local nursery business. Congratulations to Rory, and check out his story below.

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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.