Asking Price: $3,200,000
This opportunity is a Profitable Midland Michigan-based Services Business that provides high-quality, fully managed services to businesses and other establishments in the commercial and industrial sectors. The Company provides services to a wide range of industrial customers including petrochemical companies, churches, and education establishments. In addition, the Company has established many strong customer relationships, which provide steady streams of revenue from repeat customers regardless of the economic environment. Furthermore, its diversified supplier base gives it the autonomy to choose from an extensive list of suppliers.
The Company was founded in the late 70s. Ownership is active in the day-to-day operations of the Business and is responsible for scheduling, estimating, 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 experienced staff if the owners so desired. The Company employs nine skilled managers that are capable and already working towards absorbing more responsibilities to continue the Company’s history of quality work.
Current 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.
Dec. 31, 2022 Revenue: $8,136,628
Dec. 31, 2022 Cash Flow: $727,893 (Adjusted EBITDA)
Dec. 31, 2022 Inventory: $16,304
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 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 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 projects such as multi-unit subdivisions. However, the Company’s employees are more sophisticated than most industry 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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