Missouri Roofing & Exterior Contractor, Roofing, Siding & Gutters

$250K

Revenue

$582K

SDE

5.6x

Multiple

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Full Editorial Writeup

This is a Missouri-based roofing and exterior services contractor offering roofing, siding, gutters, and related home improvement work. The business has built a recognized local brand backed by strong customer reviews and a referral-driven pipeline, which is the lifeblood of any successful residential exterior contractor. It runs with experienced staff, established supplier relationships, and documented operational systems, meaning the owner is selling a functioning operation rather than a personality-dependent shop.

Roofing and exterior work sits in the sweet spot of home services demand: much of it is non-deferrable. A leaking roof, storm damage, or failing gutters get fixed whether the economy is booming or not, and insurance claims frequently foot the bill. That combination of necessity-driven work plus referral flow is what gives this category its durability.

The glaring issue is the numbers as presented. The listing shows $249,709 in revenue against $581,601 in cash flow, which is mathematically impossible for an operating contractor. Either the revenue figure is badly understated or mislabeled, or the cash flow is wrong. No serious buyer moves forward on a $3.25M ask until that discrepancy is resolved, because the entire valuation rests on it.

Why we like it

Roofing and exterior work is demand-resilient because much of it is non-deferrable. Storm damage, active leaks, and failing gutters get repaired regardless of the economic cycle, and a meaningful share is funded by insurance rather than discretionary household budgets. That creates a steadier revenue base than most home improvement niches.
The business is referral-driven with a recognized local brand and strong reviews, which lowers customer acquisition cost. In a category where most competitors bleed money on lead-gen and door-knocking, an established reputation compounds and is genuinely hard for a new entrant to replicate quickly.
The listing describes experienced staff, established supplier relationships, and proven operational systems. If true and verifiable, that means the buyer inherits a running machine with reduced key-person risk, not a shell dependent on the owner swinging a hammer.
The multiple of 5.59x cash flow is on the higher end for a residential contractor, but a business with documented systems and recurring referral flow can justify a premium if the earnings hold up under scrutiny. The upside is real if the numbers survive diligence.

How to improve it

Reconcile and rebuild the financials immediately. The stated $249,709 revenue against $581,601 cash flow cannot both be right, so the first move is to pull three years of tax returns and bank statements and establish the true top line before touching operations.
Build a systematic storm-response and insurance-claim pipeline. Roofers who partner tightly with adjusters and market aggressively after hail and wind events capture outsized demand spikes. A dedicated claims coordinator can materially lift both volume and average ticket.
Add recurring revenue through maintenance and inspection programs. Offering annual roof and gutter inspection memberships turns one-time customers into a repeat base and smooths the seasonal lumpiness inherent in exterior work.
Formalize digital lead generation to complement referrals. A structured Google Local Services, paid search, and review-solicitation engine reduces dependence on word of mouth and gives the business a second growth channel it can scale on demand.
Expand the service mix into adjacent high-margin exteriors. Windows, insulation, and solar attachments leverage the same crews, trucks, and customer relationships, increasing revenue per job without proportionally increasing overhead.
Tighten crew productivity and job costing. Implementing per-job margin tracking and a crew scheduling system exposes underperforming jobs and reduces the material and labor leakage that quietly erodes contractor profitability.

Diligence notes

The revenue-to-cash-flow relationship is the single most important item. Cash flow of $581,601 on $249,709 of revenue is impossible, so demand tax returns, P&Ls, and bank deposits to determine the real revenue and the real owner earnings before any offer is considered.
Quantify how much of the work is insurance-driven versus retail. Insurance-funded roofing is more resilient but exposes the business to storm-cycle volatility, so understanding the split and the multi-year trend is essential to underwriting durability.
Assess key-person and crew risk. Verify whether the owner personally holds the licensing, sells the jobs, or manages the crews, and confirm whether experienced staff and subcontractors will stay through a transition, since crew retention makes or breaks a contractor handoff.
Review the backlog, warranty obligations, and any open claims or litigation. Roofing carries multi-year workmanship warranties and callback exposure, so quantify outstanding liabilities and confirm they do not represent a hidden cost that eats into the earnings.
Confirm years in business, licensing status, and bonding. The listing lists years in business as unknown, and for a licensed trade that history and the transferability of licenses and bonds directly affect both risk and the ability to operate on day one.

Source

Originally listed on BusinessBroker.net. View original listing →