Combined Flooring & Lighting Design Center, 35-Year Georgia Builder Supplier

$10.6M

Revenue

$1.4M

SDE

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Full Editorial Writeup

This is a combined flooring and lighting design center founded in 1991, operating two commonly owned brands out of a single 22,500 square foot showroom and warehouse. The business sells and installs carpet, hardwood, laminate, luxury vinyl plank, and ceramic/porcelain tile, and supplies decorative and functional lighting including a recently added limited-distribution premium decorator line. It serves production and custom homebuilders, homeowners, architects, and interior designers across west metro Atlanta, northwest Georgia, and into Alabama.

Roughly 75 to 80 percent of volume comes from new construction, anchored by long-tenured builder relationships, several more than 15 years old and built entirely on referrals with no paid marketing. The dual-category format is a real differentiator in the market, giving builders one destination for both flooring and lighting across an entire home. Installation services are the single largest revenue category, which means this is a full-service model rather than pure product distribution.

The operation runs on $10.6M in revenue with $1.4M adjusted EBITDA, a 13.5 percent margin, with gross margin expanding from 32.0 percent in 2023 to 36.5 percent TTM and no long-term debt. The team includes 17 full-time employees plus a deep network of 1099 installation crews, many with 15 to 20-plus years of tenure. Three managers are positioned to take on expanded responsibility as the owners transition toward retirement.

Why we like it

Earnings quality is solid for the category: $1.4M adjusted EBITDA on $10.6M revenue at a 13.5 percent margin, with gross margin expanding 450 basis points from 32.0 percent in 2023 to 36.5 percent TTM and zero long-term debt. The margin trend suggests pricing power and disciplined vendor terms, not a business papering over declining profitability.
The moat is relationship-driven and hard to replicate: 35 years in operation, builder relationships dating back 15-plus years, and a differentiated dual-category showroom that few competitors offer. Growth has come entirely from referrals with no paid marketing, which means customer acquisition cost is effectively zero and the brand is embedded in local builder workflows.
The team depth de-risks the transition in a way most SMBs cannot match: 17 full-time staff plus a 1099 installer network where many crews have 15 to 20-plus years of tenure. Three experienced managers are already positioned to absorb owner responsibilities, and sales relationships are actively transitioning to the sales team.
There is a clear organic growth path without capital intensity: the existing warehouse can absorb an estimated 20 to 25 percent more volume with no expansion, and there is no e-commerce channel at all today. A buyer inherits backlog visibility (approx $587K cleared within three months) plus untapped trade and design-channel demand from architects and designers.

How to improve it

Launch the lighting e-commerce channel the owners never built. Lighting is a higher-margin, shippable product with a recently added limited-distribution premium decorator line, and an online storefront extends reach beyond the local builder footprint without adding showroom overhead. Start with the decorator line where exclusivity protects margin.
Push volume through the idle warehouse capacity. The facility can absorb 20 to 25 percent more throughput without expansion, so the cheapest incremental EBITDA comes from winning more builder accounts and loading existing fixed costs. Target production builders expanding in the west metro Atlanta and Alabama corridor.
Formalize the trade and design channel with architects and interior designers through targeted marketing. This segment carries higher margins and less price sensitivity than production builders, and the company already serves it incidentally. A dedicated trade rep and a designer loyalty program could shift mix toward premium work.
Reduce new-construction concentration before the next housing downturn. With 75 to 80 percent of volume tied to new construction, a buyer should aggressively grow the remodel, replacement, and homeowner retail segments to build counter-cyclical demand. Flooring and lighting replacement continues even when new builds slow.
Evaluate the proposed second warehouse-format location in Alabama only after proving the e-commerce and capacity plays. The existing facility can support it, but a buyer should validate builder demand and installer crew availability in that market first rather than deploying capital on an unproven footprint.
Lock in the 1099 installer network with formalized agreements and incentive structures. Installation is the largest revenue category and depends on crews with 15 to 20-plus years of tenure, so losing them in a transition would be catastrophic. Consider retention bonuses or equity-like incentives tied to continued service.
Tighten vendor economics by leaning into preferred contract pricing and early-pay discounts already in place. With no long-term debt and healthy cash flow, a buyer can negotiate deeper volume rebates and extend early-pay capture, directly expanding the gross margin that already grew 450 basis points in two years.

Diligence notes

Scrutinize the new-construction cyclicality. With 75 to 80 percent of revenue from new builds in a rate-sensitive housing market, pull three to five years of monthly revenue to understand how the business performed through rate hikes and any slowdown. The $587K backlog clears within three months, which gives limited forward visibility.
Verify the TTM July 2026 financials and the gross margin expansion story. A jump from 32.0 to 36.5 percent gross margin in two years is attractive but demands explanation: confirm whether it reflects durable pricing power, mix shift, vendor rebate timing, or one-time adjustments. Reconcile adjusted EBITDA addbacks line by line.
Understand the real estate lease terms since the sellers own the building separately and will lease it to the buyer. Confirm rent is at market, the lease length, renewal options, and that a related-party arrangement is not understating occupancy cost or embedding a buyout obligation that inflates the true multiple.
Assess builder customer concentration behind the referral-driven relationships. Several accounts date back 15-plus years, so quantify what percentage of revenue the top five builders represent and whether those relationships are personal to the departing owners or institutionalized with the sales team now taking them over.
Confirm the depth and legal status of the 1099 installer network. Installation is the largest revenue category, so validate crew availability, worker-classification risk, and whether any key crews are at risk of leaving. Misclassification exposure or crew attrition could materially impair the core service offering post-close.

Source

Originally listed on BizBuySell. View original listing →