IT Automation Hardware Reseller & Service, 40-Year Omaha Business

$3.7M

Revenue

$518K

SDE

2.7x

Multiple

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Full Editorial Writeup

This Omaha business, established in 1984, sells and services the hardware behind data-capture automation: barcode scanners, RFID readers, mobile computers, tablets, and label and ID printers sourced from top brands. It serves healthcare, manufacturing, warehousing, and distribution customers across the Omaha metro, pairing product resale with a certified team that installs, trains, and troubleshoots most major equipment brands. The pitch is high-touch local service in a market otherwise dominated by faceless national suppliers.

The economics are respectable but modest: $3.73M in revenue producing $517K of owner cash flow (roughly 14% SDE margin) with EBITDA of $258K after normalizing owner comp. That spread between SDE and EBITDA tells you a lot of the profit is the owner's paycheck, which matters for a buyer who needs to hire back the seller's role. The business runs lean with five employees out of a 2,700 square foot leased office, and it is the only local player in a national category, which is its whole competitive story.

The caveat a buyer must underwrite: this is fundamentally a hardware reseller. Revenue is driven by transactional equipment sales tied to customers' capex cycles, and there is no disclosed recurring or contract revenue. In a downturn, businesses defer barcode and RFID upgrades, so cash flow will move with the local capital spending climate. The moat is relationships and service quality, not switching costs.

Why we like it

The business has survived 40 years since 1984, which is real evidence of durable customer relationships and a defensible local niche in a category dominated by national suppliers. Longevity like this in a resale business usually means repeat buyers and a reputation that shortens the sales cycle. That reduces the risk that revenue evaporates the moment the owner leaves.
At a 2.7x cash flow multiple on $517K of SDE, the entry price is reasonable for a profitable, established B2B business. Even after carving out a market-rate GM salary, the $258K EBITDA supports acquisition debt at these price levels. Downside is protected by four decades of operating history rather than a hockey-stick projection.
The customers sit in healthcare, manufacturing, warehousing, and distribution, all of which increasingly depend on data-capture and RFID automation for compliance and efficiency. Structural adoption of tracking technology is a tailwind that keeps the addressable market growing even if any single year is cyclical. Being the only local hands-on partner in this space is a genuine differentiator.
This is an owner who has never built a sales team, which is exactly the operator advantage a buyer wants: the growth lever is untouched. The listing states qualified prospects have already been identified in the service area. A buyer who simply adds one or two salespeople inherits a warm pipeline the current owner left on the table.

How to improve it

Hire one or two dedicated salespeople against the prospect list the seller says is already identified. The owner has run the business with zero sales function, so even modest outbound effort should move revenue meaningfully. Track close rates and average deal size from day one to prove the ROI on each rep.
Layer in recurring revenue by launching device maintenance contracts, managed service agreements, and consumables subscriptions for labels and printer supplies. The installed base of healthcare and warehousing customers already needs ongoing supplies, so convert one-off buyers into monthly billing. Recurring revenue would also lift the exit multiple materially above 2.7x.
Build a consumables and supplies e-commerce reorder flow so existing customers repurchase labels, ribbons, and accessories without a phone call. This captures margin currently lost to national suppliers and creates a sticky, predictable revenue base. It also frees the team to focus on higher-value equipment sales.
Expand the product and service catalog within the IT landscape as the seller suggests, adding RFID software integration, inventory tracking dashboards, and installation services. Selling the software and services layer on top of the hardware raises gross margin above thin resale spreads. This deepens the relationship and increases per-customer wallet share.
Formalize vendor rebate and volume-tier programs with the top brands the business already resells. Better purchasing terms flow straight to the bottom line on a business doing $3.7M in hardware volume. Audit current buy pricing before close and renegotiate immediately after.
Reduce owner-key-man risk by documenting the technical certification and service processes so knowledge is not trapped in the seller's head. With only five employees, cross-training protects continuity if a key tech leaves. This is essential given how much of the margin is currently the owner's role.

Diligence notes

Understand the gap between $517K SDE and $258K EBITDA, which implies roughly $260K of owner add-backs. Verify exactly what role the owner plays and what it costs to replace, because that number determines your true post-acquisition cash flow. If the owner is the top salesperson and technician, the transition risk is higher than the numbers suggest.
Analyze revenue concentration by customer and by industry vertical over the last three years. A hardware reseller can carry heavy dependence on a few large healthcare or warehouse accounts, and losing one can swing profitability. Also check whether recent revenue is stable, growing, or being propped up by one-time large equipment orders.
Confirm the vendor and brand relationships are transferable and check for any exclusivity, authorized-reseller, or volume commitments. Since the entire model depends on sourcing from top brands, a lost distribution agreement could gut margins. Get the actual buy pricing and rebate terms in writing during diligence.
Scrutinize gross margins by product versus service, because resale hardware margins are typically thin and can be squeezed by direct-from-manufacturer competition. Determine how much of the $517K is service and consulting versus pass-through equipment markup. The mix tells you how defensible the earnings really are.
Review the lease on the 2,700 square foot space at $4,000 per month, including remaining term and renewal options. Confirm the $305K of included FF&E is genuinely worth that figure and not aging equipment. Verify inventory levels since the $25K of inventory is excluded from the asking price.

Source

Originally listed on BizBuySell. View original listing →