Full-Service Electrical Contractor, 21-Year Los Angeles County Operator

$2.0M

Revenue

$662K

SDE

2.7x

Multiple

Subscribe Free

Read the full deal writeup

Get Free Access

Already a member? Sign in

Full Editorial Writeup

This is a full-service electrical contractor operating in Los Angeles County for 21 years, serving both residential and commercial clients. The scope runs the full stack of electrical work: repairs, lighting installations, panel upgrades, design support, product selection and supply, and installation. The pitch to customers is a single-provider model that carries a job from planning through completion, which is a real edge against solo electricians who cannot do design and sourcing, and against larger regional shops that lack the personal touch.

The numbers are what make this interesting. On $1.95M of revenue the business throws off $661,908 of SDE, a roughly 34 percent owner-earnings margin that is genuinely strong for a trade contractor. The asking price of $1.8M works out to 2.72x SDE, and that price includes $250,000 of inventory and $100,000 of FF&E. Strip the inventory and the multiple on pure earnings looks even more reasonable. The operation runs on 7 employees out of a leased facility at $7,000 per month, so overhead is lean and there is no real estate to finance.

The seller is retiring, which is the cleanest reason to sell and usually the most negotiable. The tailwinds are real: panel upgrades, EV charging infrastructure, energy-efficient lighting retrofits, and commercial tenant improvements are all durable demand drivers in a mature, code-heavy market like Los Angeles. The business is essentially a project-based cash machine with an obvious path to add recurring maintenance revenue that the current owner never built.

Why we like it

Earnings quality is the headline: $661,908 SDE on $1.95M revenue is a 34 percent margin, which is exceptional for an electrical contractor and signals disciplined pricing and job selection. At 2.72x with $350k of inventory and FF&E baked into the price, the effective multiple on true earnings is even more attractive than the sticker suggests.
Electrical work is non-discretionary and code-driven, which makes this durable through a downturn: panel upgrades, repairs, and safety-related installs get done regardless of the economy. Los Angeles County is a dense, permanent market with an aging housing stock that constantly needs electrical modernization, so demand does not evaporate.
The tailwinds are structural and well understood: EV charging infrastructure, energy-efficient lighting retrofits, and California's aggressive electrification and building-code push all funnel work to licensed electrical contractors. This is not a fad tailwind, it is a decade-long regulatory and technology shift.
The one-stop model of design, sourcing, and installation under one roof creates stickiness and pricing power that solo electricians cannot match. A hands-on owner-operator with a contractor's license can step in, protect the margin, and immediately layer on the recurring maintenance programs the seller never developed.

How to improve it

Launch a recurring maintenance and inspection program in the first 90 days, targeting existing commercial clients with annual electrical safety checks and priority service agreements. This converts one-off project revenue into predictable monthly cash flow and raises the resale multiple materially.
Build a dedicated EV charger installation service line with a clear residential and commercial package. California incentives and utility rebates make this a high-demand, high-ticket category that plays directly to the existing licensing and crew, and it is under-marketed by most local competitors.
Fix the digital presence: the listing flags weak local search visibility and thin reviews. A focused Google Business Profile, review generation system, and local SEO push can meaningfully increase inbound lead flow at low cost, since electrical is a high-intent search category.
Segment the customer base and push toward higher-margin commercial tenant improvement work, which tends to bring larger contract values and repeat general-contractor relationships. Locking in two or three reliable GC referral partners can stabilize the revenue pipeline.
Systematize the estimating and job-costing process before the seller leaves, so pricing discipline that produces the 34 percent margin does not walk out the door. Document the pricing logic, vendor terms, and markup structure into a repeatable playbook.
Cross-train and formalize a lead technician or field manager role to reduce owner dependence in operations. This de-risks the transition and creates capacity for the owner-operator to focus on sales and growth rather than being pulled onto jobs.
Audit inventory turns on the $250k of stock and tighten purchasing to free up working capital. Some of that inventory is likely slow-moving and could be converted to cash without hurting service levels.

Diligence notes

Verify the contractor's license status and confirm how it transfers: the broker page notes 'Unable to verify state license.' In California, a licensed Responsible Managing Officer or Employee is mandatory, so understand whether the license is the seller's personally and what qualifying individual the buyer must have or hire to keep operating legally.
Pressure-test the $661,908 SDE with three years of tax returns and add-back detail. Confirm the margin is sustainable and not inflated by a single large project, deferred maintenance on equipment, or aggressive add-backs, and check revenue concentration across the customer base.
Scrutinize the $250,000 inventory figure for accuracy and salability, since it represents a meaningful chunk of the asking price. Confirm it is current, usable stock rather than dead inventory, and reconcile it against actual purchasing and job usage.
Examine the seven-person team, their tenure, licensing, and how many are certified electricians versus helpers. With a small crew, the departure of one or two key journeymen after close could cripple capacity, so understand pay, non-competes, and retention risk.
Review the work-in-progress and backlog at close, plus the lease terms on the $7,000 per month facility. Confirm the pipeline supports the trailing revenue and that the lease is assignable with reasonable remaining term and renewal options.
Confirm the reason for selling is genuinely retirement and assess owner dependence in sales and estimating. If the owner personally drives most customer relationships and pricing, six weeks of training may be thin, so negotiate a longer transition or an earn-out tied to revenue retention.

Source

Originally listed on BizBuySell. View original listing →