Highly Profitable Regional Towing Company


Highly Profitable Regional Towing Company

Asking Price:$3,000,000

Cash Flow:$1,038,000

Gross Revenue:$2,310,000





Highly Profitable Regional Towing Company

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Business Description

Top things you need to know about this business …
• High Barrier to Entry. Given the need for expensive trucks and equipment, the startup cost is very high.
• Limited Competition. The nearest competitor is 40+ miles away
• Very High EBITDA Margins. Due to the limited amount of competition, the company is able to charge premium rates. On average, EBITDA is 35% of revenue.
• Diverse lead sources. The company is not depended on one or two lead sources. The company utilizes five different referral sources (1) Municipal/Police Calls; (2) Cash Calls [Direct calls from customers]; (3) Motor Club Calls [i.e. AAA]; (4) Account Calls [i.e. Body Shops], and (5) Private Property Calls [i.e. private apartments].
• Top Brand Recognition. The company is known for its reliability, quality of work, degree of professionalism as well as its availability to turnover work quickly and handle a large workload.
• Real Estate Included. The seller also owns the real estate and it will be included in the deal. By including the real estate, the loan terms may be extended which gives a buyer more cash for operations and/or dividends.
• Regional Operations. The company has two yards 120 miles from each other to effectively cover a large part of the West Texas region. The company is currently in talks to acquire a third yard and is considering opening a fourth yard in the very near future.
• Professional Operations. This is not the standard local garage towing service but a state of the art transportation operation running sophisticated dispatch and tracking services.

• Heavy-Duty Towing & Recovery
• Light-Duty Towing & Roadside Services
• Emergency Roadside Services for Autos, Vans, SUVs, Light Trucks, Motor Homes
• Jump-starts
• Fuel Delivery
• Lockouts
• Standard Vehicle Tire Changes
• Local & Long-Distance Towing
• Roadside Services for Trucks

Business Activity:
Founded in 2009, this West-Texas based towing company has become a market leader in its community/territory for towing and tire services. While the company mostly focuses on heavy-duty and light-duty/roadside service; they also offer other services such as jump-starts, fuel delivery and lockouts, etc. The average ticket size is $400 while the industry average is probably $200 or under. The company is currently starting up a third yard and plans to open a fourth yard in the very near future. The company has a variety of lead sources and a very diverse customer base. The company has and the owner oversees the day-to-day operations.

Key Strengths:
1) Well established reputation
2) Talented Staff
3) Limited Competition
4) Very experienced labor force / cross trained in related work
5) Well equipped and maintained fleet.

Key Weaknesses:
1) Location. The company is located in rural West Texas. While it’s a remote location, there is limited competition and allows the company to offer premium rates.
2) Active Owner. The owner is active in the business due to his Type A personality however a new buyer can promote one of the staff members to a general manager and/or bring in a GM.
3) CAPEX. Given the nature of the industry, trucks have been replaced occasionally.
4) Drivers. Finding well-qualified truck drivers may be a challenge due to the nature of the job. The company pays its drivers well which helps reduce its turnover rate.
5) Active Owner. The owner is very active in the business however is slowly transiting himself of the business. One yard is self-sufficient and his working to get the other yard self-sufficient as well.

Detailed Information

Furniture, Fixtures, & Equipment (FF&E):
Included in asking price
The business occupies a 400 sq ft building. The company also occupies 2 ½ acres of land between two different lots. Lastly, the company owns rental properties for the drivers.
There is no formal sales force. The company has billboards and other advertisements around the area.
Support & Training:
The Owner genuinely desires an effective business transition with seamless customer service through to the buyer. They will train a buyer for 30 days. An additional consulting contract can be obtained.
Reason for Selling:
The owner wishes to retire.

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Anthony Cullins

Business Listed By:
Anthony Cullins

The Vant Group

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Alex Vantarakis

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