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Stone & Tile Contractor Selling at 2.4x Annual SDE 🪨

Under the Radar Weekly Deals

The #1 Boring Biz Newsletter

👋 Hey fellow searchers,

Welcome to issue #20 of Under the Radar!

Let’s get right into it.

This week’s issue features:

  • ♻️ Waste management company w/ $1.9M annual revenue

  • 🪨 Stone & tile contractor selling at 2.4x annual SDE

  • 🦺 Concrete construction biz w/ $600K annual SDE

Hot Deals 🔥

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

#1. Waste management company w/ $1.9M annual revenue

🏷️ Asking Price: $1,500,000

📍 Location: Silver Spring, MD 

Overview: This SBA-prequalified waste management company has been operating since 1984. The family-owned business is renowned for its reliability, environmental stewardship, and exceptional service, offering a comprehensive suite of waste management solutions including residential trash collection, commercial waste management, recycling programs, and specialized waste removal services. The owner is retiring and will provide 4 weeks of training.

Key Highlights

  • ~$1.91M annual revenue

  • ~$465K annual SDE

  • +24% avg. net margins

  • Existing customers = +80% of revenue

  • 11 employees

Growth Avenues 🚀

  • As environmental consciousness grows, so does the demand for comprehensive recycling and composting services. This company can capitalize on this trend by expanding its recycling programs to include more materials and by offering educational workshops to communities and businesses about effective recycling practices.

  • Forming alliances with local municipalities, large commercial clients, and other waste management entities can open new revenue streams and expand the customer base.

Potential Risks 🚩

  • The waste management sector is highly competitive, with numerous large national firms and local companies. The company needs to continuously innovate and maintain high service standards to retain its market share.

Questions❓

  • What are the specific types and conditions of the equipment included in the sale?

  • Who are the main competitors in the region, and what are the company's strategies for maintaining its market position?

  • Since the seller is not including the real estate in the sale, is the new owner able to rent the current facility, and what are the terms of such an arrangement?

#2. Stone & tile contractor selling at 2.4x annual SDE

🏷️ Asking Price: $1,900,000

📍 Location: Las Vegas, NV

Overview: This stone and tile contractor has been operational for over 19 years, focusing primarily on commercial projects including prestigious Nevada malls and casinos. The company is highly regarded for its craftsmanship and reliability, often obtaining bids without significant marketing efforts. It has a deep network of loyal commercial clients and a strong market presence, making it a preferred contractor in the region. The business has been SBA-approved and the owner is open to staying on temporarily during the transition to ensure a smooth handover.

Key Highlights

  • ~$2.8M annual revenue

    • 1Q24 rev = $1.1M

  • ~$802K annual SDE

  • $300K inventory (included in asking price)

  • $6M+ contracts in hand

    • +$11M casino bathroom remodel

  • 4 employees

Growth Avenues 🚀

  • Leveraging the company’s strong reputation, expanding into the residential sector could provide a new revenue stream. High-end residential projects can showcase the company's premium craftsmanship.

  • Offering complementary services such as countertop fabrication, tile repair, and maintenance services can provide additional value to clients and enhance revenue.

Potential Risks 🚩

  • A significant portion of the business comes from key commercial clients. Losing these clients could have a substantial impact on revenue.

  • Finding and retaining skilled labor is a common issue in the construction industry, potentially impacting project quality and timelines.

Questions❓

  • What are the facility lease terms, and are there options for renewal or relocation if necessary?

  • How does the company consistently secure bids without significant marketing efforts, and what strategies are in place to maintain this?

  • What are the details of the contracts currently in hand, including their scope, duration, and any special conditions? Are they transferrable to the new owner?

#3. Concrete construction biz w/ $600K annual SDE

🏷️ Asking Price: $2,500,000

📍 Location: Madison County, GA

Overview: Established in 2005, this concrete construction business boasts a robust client base and a consistent record of profitability. Specializing in prepped and poured footings, walkways, driveways, parking areas, and slabs of all sizes, the business has built a strong reputation for quality work. The company operates with a highly skilled and dedicated team, ensuring the highest standards of craftsmanship and customer satisfaction. The business's success is further supported by state-of-the-art equipment and a comprehensive fleet of vehicles (included). The owner is selling due to retirement but is willing to assist in the transition to ensure a smooth handover.

Key Highlights

  • ~$1.2M annual revenue

  • ~$600K annual SDE

  • $240K inventory (included in asking price)

  • 3 months of work on the book

  • Manager in place

  • Option to purchase additional biz (roll-off dumpster)

Growth Avenues 🚀

  • The business can extend its service area to nearby regions, capitalizing on its strong reputation and established processes

  • Pursuing larger commercial contracts can increase revenue significantly. Establishing relationships with local builders and developers can open doors to substantial projects.

Potential Risks 🚩

  • The business may rely heavily on a few key suppliers for materials, and any disruption in supply chains could affect operations

  • Construction projects often involve delayed payments from clients, which can impact cash flow and financial stability

Questions❓

  • What are the details of the jobs currently accepted and on the books for the next three months? What is their estimated value?

  • Are there client testimonials or satisfaction surveys available to demonstrate the business's reputation for quality and reliability?

  • What are the key supplier relationships, terms of these relationships, and potential risks associated with supply chain disruptions?

Radar Picks 📡

Bit-sized reads featuring insights and fresh perspectives

Tweet of the Week 🐦

This week’s featured tweet comes from Nick Huber of Sweaty Startup. He breaks down the five stages of bottlenecks in business growth: getting initial customers, hiring employees, attracting more customers, bringing in managers, and improving systems and processes. Each stage presents unique challenges that entrepreneurs must navigate to scale their businesses effectively. Check it out👇

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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.