Commercial Kitchen Exhaust Cleaning, 15-Year Grand Rapids Operator

$2.0M

Revenue

$504K

SDE

1.0x

Multiple

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Full Editorial Writeup

This is a commercial kitchen exhaust cleaning business based in Grand Rapids, Michigan, established in 2009. It cleans grease-heavy hood, vent and duct systems for commercial customers, and layers on maintenance, repairs and related consulting. The core service is a mandated, non-negotiable one: restaurants, institutional kitchens and food-service operators are required by fire code and insurance to keep exhaust systems cleaned on a recurring schedule, which is precisely why this work keeps coming back.

The model runs on repeat service cycles. Once an account is on the calendar, the next service date is booked before the crew leaves, creating a predictable flow of scheduled jobs and a natural base to upsell additional work into existing commercial accounts. Eight employees (six full-time, two part-time) do the field work while the owner runs the engine: quoting jobs, filling the calendar, coordinating crews, tracking documentation and staying in front of customers.

With roughly $2.02M in revenue and $503,600 in cash flow, this is a genuinely profitable services business at a 25% owner-earnings margin. At a $516,800 asking price, that is a 1.03x cash flow multiple, which is unusually cheap for a code-mandated, recurring-revenue service. The obvious tension is owner dependence: the seller personally runs sales and scheduling, so the price likely reflects transferability risk rather than a weak business.

Why we like it

Earnings quality is strong for the category: $503,600 of cash flow on $2.02M revenue is a 25% margin, and the asking price of $516,800 implies a 1.03x multiple. Paying roughly one year of owner earnings for an established, profitable services business is aggressive value if the cash flow proves transferable.
The moat is regulatory, not marketing. Commercial kitchen exhaust cleaning is mandated by NFPA 96 fire code and required by insurers, so customers cannot skip it, and the documentation and inspection trail creates real switching friction once you own the account.
This is durable through a downturn. Restaurants and institutional kitchens still have to clean grease systems whether the economy is booming or contracting, and the recurring service cycle means revenue does not depend on re-winning discretionary purchases.
The operator advantage is clear: an owner who builds a real sales and scheduling layer under themselves can grow this without heroics, since the field work is already staffed by six full-time and two part-time crew members. The upsell path into maintenance, repairs and consulting on existing accounts is untapped leverage.

How to improve it

Replace the owner in the sales and scheduling seat within the first 90 days by hiring or promoting an operations coordinator. The listing is explicit that the owner personally quotes jobs, fills the calendar and coordinates crews, and that single point of failure is the reason this trades at 1x rather than 3x.
Convert every account onto a formal recurring service agreement with pre-booked dates and auto-renewal. Locking in the calendar contractually turns implied repeat business into contracted revenue, which both stabilizes cash flow and materially raises the resale multiple.
Systematically upsell existing commercial accounts on maintenance, repairs, filter replacement and related consulting. The description already flags that additional work can be sold into current customers, so a structured cross-sell playbook adds margin with zero customer acquisition cost.
Build a code-compliance documentation product: deliver inspection-ready service records and reminders that make the customer's fire marshal and insurer conversations effortless. This deepens switching costs and justifies premium pricing versus commodity cleaners.
Add a second crew and expand the service radius beyond Grand Rapids into surrounding Kent County and West Michigan. With demand tied to fixed restaurant counts, geographic density is the cheapest growth lever available.
Tighten pricing discipline and route density so crews are not driving between low-margin jobs. Small improvements in jobs-per-day-per-crew flow straight to the bottom line given the fixed labor base of eight employees.
Institutionalize the quoting process into a repeatable estimating template so a non-owner can produce accurate bids. This directly attacks owner dependence and is prerequisite to scaling headcount without margin erosion.

Diligence notes

Quantify exactly how much of the $2.02M revenue is truly recurring versus one-off. Ask for a customer-level history showing repeat service frequency, average revenue per account, and what share of jobs were pre-scheduled rather than newly won each period.
Stress-test owner dependence hard. The owner quotes, schedules, coordinates and owns customer relationships, so confirm which relationships travel, whether customers are loyal to the company or the individual, and what happens to booking flow post-close.
Verify the cash flow. Get three years of tax returns and P&Ls, and reconcile the $503,600 SDE add-backs line by line, since a 1.03x multiple on unverified seller numbers is the classic trap in owner-operated service deals.
Confirm equipment condition and vehicle count. The business needs trucks, pressure and cleaning equipment; verify what is owned free and clear, deferred maintenance, and near-term replacement capex that could eat into that margin.
Check customer concentration and contract status. Determine whether a handful of accounts drive the revenue, whether any written agreements exist, and how price and renewal terms are set, since concentration would sharply change the risk and the price you should pay.
Review licensing, insurance and code-compliance requirements for kitchen exhaust cleaning in Michigan. Confirm the crews carry required certifications and that the buyer can maintain them, because losing compliance status would undermine the regulatory moat.

Source

Originally listed on BizBuySell. View original listing →