Deal Flow: Facility Services — Commercial Coatings, Painting, & Cleaning

This SBA-approved Commercial Coatings, Painting, and Cleaning Business could be your Next Big Opportunity

Pete Weishaupt
6 min readDec 31, 2024

So, you’re in the market for a profitable service business? Here’s a service business that does all sorts of important things like commercial coatings, painting, and cleaning. It’s a solid, no-nonsense deal. It’s got a good track record, it makes money, and it’s sitting on a big pile of potential. Plus, it’s got the SBA Pre-approval (that means financing could be a lot easier), and the rent is low. If you’re the type of buyer who knows how to bring a little cash to the table and has a solid plan for growth, this business could be your golden ticket.

The price tag is $1,450,000, and you might be thinking, “Is this the real deal?” Well, it’s not outrageous. The business is bringing in a healthy $375,000 in cash flow each year, and it’s doing so with a solid 19.7% profit margin. That’s a pretty good chunk of change for a company in this industry with a reputation that’s held up over time. But, like any good detective, you’ll need to dig deep into the details — specifically, the lease agreement, how well employees stick around, and the level of competition you’d be up against. These are the areas where the devil tends to hide in the details, and you want to find that devil before you sign on the dotted line.

Here’s the exciting part. This business isn’t just sitting around. There’s room — like a lot of room — for growth. A bit of marketing magic, bringing in the right people for key roles, and maybe expanding the services or geographic reach could send this thing skyrocketing. If you’re the type of person who knows how to make stuff happen, this could turn into a seriously profitable venture.

Here’s a detailed analysis of the listing:

Business Overview

  • Asking Price: $1,450,000
  • Cash Flow: $375,000
  • Gross Revenue: $1,900,000
  • EBITDA: N/A
  • FF&E (Furniture, Fixtures, and Equipment): $350,000 (included in the asking price)
  • Inventory: Included in asking price
  • Rent: $2,500 per month
  • Employees: 10
  • Established: 2008
  • Location: Fairfield County, CT (leased building with a 2,500 sq. ft. facility)
  • Real Estate: Leased (standalone service building with business offices)
  • SBA Financing: Pre-approved

Key Metrics & Valuation

  • Cash Flow to Asking Price Ratio: The business generates $375,000 in cash flow on an asking price of $1,450,000, which gives a cash flow multiple of approximately 3.87x. This multiple is within a reasonable range for a service-based business with stable demand, long-term client relationships, and solid profitability. Typically, service businesses like this one sell for multiples between 3x and 5x cash flow, making the asking price competitive.
  • Revenue and Profitability: The business generates $1,900,000 in gross revenue, which, with a $375,000 cash flow, results in a cash flow margin of 19.7% ($375,000 ÷ $1,900,000). This is a solid margin for a contracting business, particularly one that provides specialized services like coatings, painting, and cleaning. This indicates that the business is well-managed and efficient.
  • FF&E: The $350,000 in FF&E includes essential equipment for providing coatings, painting, and cleaning services, such as paint sprayers, concrete prep equipment, vacuum equipment, hand tools, miscellaneous tools, and vehicles. These assets add value to the business.

Business Model and Operations

  • Service Offering: This is a full-service commercial and industrial contracting company that provides services to a wide range of industries, including:
  • Floor & surface coatings (epoxy, urethane, waterproof coatings)
  • Painting services
  • Cleaning and pressure washing (including buildings, ventilation, machinery, and degreasing)
  • Specialized prep work (diamond grinding, shot blasting, leveling)
  • The business serves a diverse client base that includes commercial real estate, food and beverage, manufacturing, automotive, aerospace, construction, and municipalities. This diversification across industries reduces dependency on any one sector, providing stability and growth potential.
  • Skilled Employees: The business has a skilled team of 10 employees, with the owner having provided advanced training. This skilled workforce allows the business to handle complex projects and high-demand services, ensuring high customer satisfaction. The business is fully staffed, and the employees are capable of executing fieldwork efficiently.
  • Location and Facilities: The business operates from a 2,500 sq. ft. leased facility. The facility is a corner property with good visibility and includes business offices for administrative work. The warehouse space is used for storing equipment and inventory, with enough room for operational needs. The low rent of $2,500 per month is a significant advantage, as it keeps overhead costs down.
  • Service Area: The business services the tri-state area, including Connecticut, New York, and New Jersey, which gives it a wide geographic reach and potential for growth by expanding the service area further.

Strengths

  1. Strong Profitability: The business generates a healthy cash flow margin of 19.7%, which suggests that it is operating efficiently. This is attractive for potential buyers. It suggests the business is well-run with good cost controls in place.
  2. Diverse Client Base: The company serves a wide range of industries, from real estate to aerospace, which spreads risk across various sectors. This diversification makes the business more resilient to economic fluctuations in any single industry.
  3. Established Reputation: The business has built a strong reputation over its years of operation (since 2008). It has skilled employees, a solid client base, and long-term relationships with contractors and service providers. This reputation helps drive repeat business and referrals, which is valuable for sustained growth.
  4. SBA Financing Available: The business is SBA Pre-approved for financing with the ability to secure a loan with a 10% down payment. This makes the business more accessible to buyers who may not have the full capital available upfront, which could be a key advantage for financing the acquisition.
  5. Growth and Expansion Opportunities: There are opportunities for growth by investing more in marketing, hiring additional staff, or expanding into new geographic areas or service sectors. The demand for commercial and industrial coatings, painting, and cleaning services is steady, and the business can scale easily as demand increases.
  6. Low Rent: The business operates in a leased space with a low rent of $2,500 per month, which helps keep overhead costs manageable. The lease terms (if favorable) would add additional stability to the business, and you can negotiate with the landlord for an extension or renewal.

Risks and Considerations

  1. Lease Expiration: The lease on the 2,500 sq. ft. facility does not have an expiration date listed, but it is important to verify the terms with the landlord. You should assess the long-term viability of the lease and whether the landlord is willing to offer favorable renewal terms, especially since the location plays a key role in the business’s visibility and operations.
  2. Employee Retention: While the business is fully staffed, you’ll need to assess the employee retention rate and ensure that key personnel are willing to stay post-sale. A sudden loss of staff could disrupt operations, so understanding the workforce dynamics is extremely important.
  3. Inventory Management: Although the inventory is included in the asking price, you should conduct an inventory review to ensure that it is up-to-date and aligned with demand. Any obsolete or slow-moving inventory could affect profitability.
  4. Dependence on Key Contracts: The business may rely on key client contracts, and it’s important to make sure these relationships are secure and long-term. A loss of major accounts could impact future revenue, so due diligence should focus on contract terms and customer retention strategies.
  5. Competition: The business operates in a competitive market with other commercial coatings and cleaning service providers. You’ll need to understand the competitive landscape and assess how to maintain or increase market share, particularly if the business faces new entrants or pricing pressure.

What do you think? Check it out and let me know!

About: Silverwave Deal Flow combs through and analyzes thousands of businesses available for sale that may be of interest to entrepreneurs looking to acquire an existing business. We are not affiliated with the business listed for sale unless otherwise disclosed.

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