Diagnostic Imaging Equipment Sales, Rentals & Service, 20-Year Chicago Provider

$1.7M

Revenue

$795K

SDE

3.5x

Multiple

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Full Editorial Writeup

This is a 20-year-old diagnostic imaging equipment business operating out of Chicago that generates roughly $1.75M in revenue and $795K in seller cash flow, a healthy 45% margin. It runs three integrated revenue streams: equipment sales, rentals, and factory-trained service and maintenance, serving hospitals, surgery centers, and healthcare practices on a nationwide basis. The service and maintenance component is the sticky part of the model, since diagnostic imaging machines require ongoing certified upkeep and the business has built two decades of technical credibility to deliver it.

The company competes not by being the biggest but by pairing a high level of service with lower cost than the large OEM suppliers and manufacturers. That positioning matters in a niche where hospitals and surgery centers want responsive, expert service without paying manufacturer-tier rates. With only three full-time employees and a lean 5,100 square foot leased facility at $5,800/month, the operation is remarkably efficient for the profit it throws off.

The obvious catch is owner dependency. The seller personally provides the technical service, which is the moat. The listing is upfront that a buyer either needs technical acumen and training, or must hire a technician and refocus themselves on sales. There is currently no dedicated salesperson and the go-to-market is reactive rather than proactive, which the seller frames as the primary growth lever for a new owner.

Why we like it

Earnings quality is strong: $794,823 of cash flow on $1.75M of revenue is a 45% margin, well above typical services comps, and the 3.46x multiple on a 20-year operating history is reasonable for a healthcare niche. The blend of sales, rentals, and recurring service revenue smooths the lumpiness that pure equipment sales would otherwise create.
The service and maintenance line is a durable moat: diagnostic imaging equipment requires ongoing certified upkeep, and factory-trained technical expertise built over two decades is genuinely hard to replicate. Hospitals and surgery centers do not switch service providers casually once a machine is under a maintenance relationship.
Demand is recession-resistant because diagnostic imaging is core to how hospitals, surgery centers, and practices generate revenue, and imaging equipment must stay operational and compliant regardless of the economic cycle. This is essential B2B healthcare infrastructure, not discretionary spend.
The operator advantage is clear and quantified: there is no dedicated sales team and the current approach is reactive. A buyer who installs even a modest proactive sales motion on top of an already-profitable base has an obvious, self-funded growth path without needing to fix anything broken.

How to improve it

Hire or contract a certified imaging service technician in the first 90 days to de-risk the single biggest dependency: the owner personally performing technical service. This protects the moat and frees whoever ends up owner-facing to focus on growth rather than being trapped in the van.
Build a proactive outbound sales function targeting hospitals, surgery centers, and multi-site practices. The seller explicitly flags the reactive sales posture as the top growth lever, so a dedicated rep with a defined pipeline could lift revenue meaningfully off the existing customer base.
Convert one-off service work into recurring annual maintenance contracts with scheduled preventive visits. Locking customers into predictable service agreements raises retention, smooths cash flow, and increases the multiple a future buyer will pay for the same earnings.
Expand the rental fleet strategically to capture short-term equipment needs from surgery centers and practices that cannot justify a full purchase. Rentals produce recurring utilization revenue and often lead into service relationships and eventual sales.
Systematize and document the technical knowledge currently living in the owner's head into training manuals and standard operating procedures. This reduces key-person risk, accelerates onboarding of new technicians, and directly increases enterprise value at exit.
Layer in a parts and consumables resale line tied to the installed base the company already services. Cross-selling replacement parts and accessories to existing service customers is high-margin revenue that requires almost no new customer acquisition.

Diligence notes

Break down revenue and margin by stream: sales, rentals, and service. The service line is the sticky, high-value component, so understanding what percentage of the $1.75M and the $795K cash flow comes from recurring service versus lumpy equipment sales is essential to underwriting durability.
Quantify owner dependency precisely, since the seller personally performs technical service. Confirm exactly how many billable service hours the owner delivers, what certifications are required, and how long realistic replacement or training would take before committing to the deal.
Analyze customer concentration across the nationwide base of hospitals, surgery centers, and practices. With only three employees generating this profit, a handful of large accounts could drive most of the revenue, and losing one post-close would materially change the economics.
Verify the rental fleet's condition, book value, remaining useful life, and any deferred capital needs. Aging diagnostic equipment in the rental pool could require significant reinvestment that is not reflected in the current cash flow figure.
Confirm the recurring nature and contractual terms of service relationships. Determine how many customers are under formal maintenance agreements versus ad hoc calls, since that distinction drives both revenue predictability and the defensibility of the multiple.

Source

Originally listed on BizBuySell. View original listing →