This opportunity is an Industrial and Commercial General Contractor for sale based in Central Michigan that provides high-quality, fully managed services to businesses and other establishments in the commercial and industrial sectors. The Company provides services to petro-chemical companies, churches, education establishments, and large residential projects. In addition, the Company has established many strong customer relationships, which provides the Business with steady streams of revenue from repeat customers. Furthermore, its diversified supplier base gives it the autonomy to choose from an extensive list of suppliers.
The Company was founded over 40 years ago. The two current owners are active in the day-to-day operations of the Business and are responsible for scheduling jobs and labor, estimating jobs, and various administrative duties. Despite the owners’ involvement in the Business, the Company is not necessarily heavily reliant on the owners as many of these duties can be delegated to lower-level staff if the owners so desired. The Company employs nine other skilled managers that are capable and already working towards absorbing more responsibilities to continue the Company’s history of quality work.
The two owners have been involved in the construction industry for many years and wish to divest the Business to pursue retirement. Ownership is willing to provide reasonable and customary transition assistance and is committed to supporting the Company’s continued growth throughout a transition period of approximately one year.
The Company’s facility is owned within the business entity and is well-maintained and in excellent condition. The owners are flexible regarding the sale or lease of the real estate with the Business.
Buyers will be required to have a minimum of $300,000, solid credit, and preferably industry experience to qualify for SBA 7a financing.
June 30, 2022 TTM Revenue: $8,824,408
June 30, 2022 TTM Cash Flow: $856,947 (Adjusted EBITDA)
June 30, 2022 Inventory: $27,213
Number of Employees: Core group of approximately 28 employees.
Facilities: The Company operates out of facilities totaling 13,133 square feet. The office is 2,140 square feet, the shop is 7,673 square feet with a 1,500 square feet overhang area, and the pole barn is 1,820 square feet.
Support/Training: Current ownership is open to remaining employed by the Company for a period of approximately one-year post-sale of the Business and is willing to provide reasonable and customary assistance during the transition period. A replacement for two owners is needed.
Reasons for Selling: The two owners have been involved in the construction industry for many years and wish to divest the Business to pursue retirement.
(1) Strategic Project Selection: The Company is meticulous in its project selection, which has allowed the Business to only select high-margin jobs. Since the Company targets complex jobs to face less competition from other construction companies, it typically does not need to win bids based on price and can maintain strong margins.
(2) Repeat Customers: Most of the Company’s revenue comes from repeat customers. These customers are mainly centered around petrochemical companies, churches, and education establishments, which account for most of the Company’s sales. The Company performs several jobs per year at these establishments and even has some customers requiring year-round work.
(3) Non-Discretionary Customer-Base: The Company is located around many of its customers, allowing it to lessen delivery times and adhere better to customer needs. The types of customer contracts that are implemented decrease the risk for non-paying customers for the Company. Additionally, the chemical work and concrete jobs completed by the Company are typically mission-critical and provide additional stability in economic downturns.
(1) Increase Service Offerings: The Company could generate more revenue by building out small drywall, acoustical, and siding projects and hiring employees with the appropriate skills to perform the work. The Company already has a deep roster of customers, especially in the commercial sector that could utilize these new offerings. The Company could also acquire new customers, specifically needing drywall, acoustical, and siding services in Central Michigan.
(2) Expand Into Specialty Residential Work: These projects include large residential houses requiring an extra degree of skill. Since the Company is smaller, it is kept out of substantial construction projects such as multi-unit subdivisions. However, the Company’s employees are more sophisticated than most residential construction employees due to the requirements needed for working in chemical plants, which could make them better suited for large specialty houses that are difficult to build.
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