Non-Union HVAC Business in Nebraska with Profit of $255,000
With 250 maintenance agreements, this HVAC company has been serving customers for many years. This business provides sales, installation and service of heating, air conditioning and air quality/handling systems for home, office and other usable spaces. They are an authorized dealer for a well-recognized manufacturer. The current client base is 50% residential and 50% commercial, providing diversity of sales income. The 2015 Gross Sales were $853,834 and the Profit Margin for that year was 29%. Products and services are available to clients within a 45-mile radius of the office, which is West of Lincoln, NE. Assets included with a purchase of the business equal $278,829. The business has an established website, a social media presence on Facebook and Twitter, maintains a blog on WordPress and utilizes newspaper advertising, reaching out to customers on a variety of platforms.
The owner’s current responsibilities include bidding and office management and Owner’s spouse handles install billing, rebates, warranty and newsletter. The full staff includes 2 service techs, 1 installer and 1 office person who handles marketing, dispatching, payroll, service billing and accounts receivable and payable.
Using the funding example above and using the 2015 Cash Flow of $255,188, a Buyer could retain $185,604 as net profit after servicing the loan payments. The loan is fully collateralized with the current equipment and vehicles.
Year Established: 1957; Current Owner since 1994
Location and Service Area: Eastern side of Nebraska, just West of
Lincoln, NE, serving customers county-wide within a 45-mile radius
Client Demographics: 50% residential/50% commercial; 250
Maintenance Agreement Customers
Lease: Rent for $2,500/month
Reason for Selling: Aging Owner
Employees: 2 Service Techs, 1 Installer, 1 Office (Marketing, AR, AP
and Service Billing and could assume work of Owner’s spouse –
Install billing, Warranty, Rebate, Newsletter)
Seller Training Period: 90 Days
Current Owner’s Responsibilities: Bidding and Office Management
List Price: $430,000
Owner Profit/Cash Flow
Profit Margin: 29%
Valuation: 3 Year Avg. Cash Flow X Multiple = Fair Market Value
$225,265 X 1.9 = $428,003
*A Multiple discount on the Fair Market Value was given due to geographical region and Seller’s motivation to sell.
Assets Included in Purchase $278,829
Vehicles: $150,000 (2007 GMC, 2010 GMC, 2011 GMC, 2012 Chevrolet, 2006 Cargomate Trailer, 2015 Hull Trailer, Forklift & Scissor Lift)
Furniture and Fixtures: $28,348
*Amounts may vary*
Purchase Price: $430,000
10% Buyer Down Payment: $43,000
15% Seller Financing: $64,500
75% Bank Loan: $322,500
Bank Loan is fully collateralized by equipment and vehicles.