Featured Business: Commercial Roofing

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Featured Business: Commercial Roofing

Welcome to this week’s highlight in SMB Power Play: This Commercial Roofing business has been a cornerstone in the roofing sector for 25 years, specializing in Aztec roof coatings and Duralast membrane installations in Indiana. With a reputation for quality and a dedicated team, this business offers a solid foundation for future growth.

TL;DR

• Consistent Revenue Stream: The business has maintained a steady revenue stream between $2 to $2.5 million annually over the last three years, with a net income of approximately $250k.

• Owner Involvement: The sole owner is deeply involved as the main estimator and manager of day-to-day operations.

• Team Structure: The company has a small, effective team of two full-time year-round employees and four full-time seasonal employees. The two full-time employees are integral to the company's success. The general manager oversees bookkeeping, scheduling, and administrative tasks, ensuring the office runs smoothly. Meanwhile, the production manager manages the ordering and receipt of materials, coordinates roof inspections, and maintains relationships with subcontractors, ensuring the field team is supported and operations run efficiently.

Financials at a Glance

• Revenue Stability: This company has demonstrated consistent revenue, maintaining between $2 to $2.5 million annually, showcasing reliability in income streams despite economic fluctuations.

  Net Income: The business sustains a net income of $250k annually, reflecting operational efficiency and financial stability.

Operational Insights

• Business Model: The company operates primarily through direct contracts with clients, leveraging leads from Aztec. The owner invests $10k-$15k annually for leads, receiving 17 qualified leads per $5k spent, ensuring a steady influx of potential clients.

  Team Structure: With two full-time employees and four seasonal workers, the business effectively manages operational demands while controlling costs, especially during peak seasons.

SWOT Analysis

Strengths:

• The business has a solid reputation built over 25 years, a dedicated team, and a consistent client base. This reliability is a significant asset.

Weaknesses:

• The owner's central role in operations and as the sole estimator presents a challenge as they near retirement, potentially impacting the transition process.

Opportunities:

• There is potential to introduce an annual maintenance program, which could provide recurring revenue and deepen customer relationships.

Threats:

• Economic downturns can lead to reduced demand for roof replacements. Additionally, the owner’s advanced age and sole role as the estimator pose challenges for continuity.

Future Prospects and Strategy

• Growth Potential: By introducing new service lines, such as an annual maintenance program, the business can expand its service offerings and increase revenue streams.

• Sale Considerations: The owner seeks to retire and is open to seller financing, making this a flexible opportunity for potential buyers.

Power Play:

This week’s Power Play focuses on a robust Commercial Roofing business that stands out for its long-standing industry presence and consistent revenue. The owner's motivation to retire opens the door for a new leader to take the helm, offering an exciting opportunity to build upon a solid foundation. With minimal overhead costs, a skilled team, and the potential to expand service offerings, this business presents an attractive opportunity for strategic investors looking to enter or expand within the roofing industry.

This is a good fit for you if…

1. You’re Seeking a Stable Business: Ideal for investors seeking a business with a proven track record of consistent revenue and profitability, maintaining $2 to $2.5 million annually. You have a platform company and want to do a bolt on.

2. Interested in the Roofing Industry: If you're drawn to businesses in the construction sector, particularly roofing, this company offers a specialized niche in coatings and membranes.

3. Looking for Operational Simplicity: The business's straightforward model and lean team make it ideal for those who value simplicity and efficiency in operations.

4. Keen on Expansion Opportunities: For those interested in exploring new service lines, such as maintenance programs, this business offers room for growth and diversification.

5. Appreciate a Hands-On Role: Given the current owner's involvement, this business is perfect for someone eager to engage directly in operations and client interactions.

6. Motivated by Long-Term Stability: This business is well-suited for those looking to invest in a reliable and established operation with potential for further development.

This Commercial Roofing business is not just an acquisition; it’s an opportunity to lead a well-established company into its next phase of growth and innovation.

Interested in this deal?

Contact [email protected] to learn more!