Profitable Home Remodel Co., 29-Year Santa Barbara County Contractor

$2.0M

Revenue

$544K

SDE

2.3x

Multiple

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Full Editorial Writeup

This is a home remodeling contractor operating in Santa Barbara County, California, in business since 1997. The company generated $2.04 million in gross sales in 2025 with $544,106 in owner income verified by tax return, working out to a healthy 27% owner earnings margin on a project-based construction model. The business runs with 6 experienced staff and a lean 2,000 square foot leased footprint at $6,000 per month plus utilities.

The firm serves homeowners undertaking remodels in one of the wealthiest coastal markets in the country, where high home values and older housing stock support steady demand for renovation work. The 29-year operating history and reputation in a tight geographic market are the real assets here, alongside a staff the seller says is expected to stay. The owner is retiring and offering up to 6 months of training for a smooth handover.

What buyers should note is the revenue trajectory: sales fell from $2.48 million in 2023 to $1.91 million in 2024 before recovering modestly to $2.04 million in 2025. That volatility is typical of project-based remodeling, but it means the earnings base is less predictable than a subscription or route business, and the buyer is stepping into an owner-operated shop where the retiring owner has likely been central to sales and client relationships.

Why we like it

Earnings Quality is strong on paper: $544,106 of owner income on $2.04 million of revenue is a 27% margin, and the seller states it is verified by tax return. At a $1.25 million ask the 2.3x cash flow multiple is cheap for a business with this margin profile, though the buyer must confirm how much of that income depends on the departing owner.
Durability comes from 29 years of continuous operation in Santa Barbara County, one of the most affluent and supply-constrained housing markets in California. A long track record and local reputation are the moat in residential remodeling, and older high-value homes generate a steady pipeline of renovation work.
Market tailwinds favor the location: coastal California has expensive, aging housing stock and homeowners with the equity and income to fund large remodels. Even in slower cycles, wealthy owners in this market tend to keep spending on their primary residences.
Operator advantage is real for a buyer with sales or construction management experience. The seller offers up to 6 months of training and a team of 6 experienced staff expected to stay, so a capable operator could step in, protect the base, and push toward the $2.48 million revenue level the business hit as recently as 2023.

How to improve it

Diagnose the 2024 revenue dip from $2.48 million to $1.91 million within the first 90 days. Understand whether it was lost bids, fewer leads, capacity constraints, or the owner pulling back ahead of a sale, because the fix is different in each case and directly determines the sustainable earnings base.
Build a repeatable lead engine to reduce dependence on the owner's personal referral network. Invest in a modern website, Google Local Services ads, and reviews so the pipeline survives the founder's exit rather than walking out the door with him.
Formalize the sales and estimating process so the retiring owner's role can be transferred to a project manager or dedicated salesperson. In owner-operated remodelers the founder usually closes the jobs, and de-risking that seat is the single most important post-close initiative.
Layer in recurring or repeat revenue through a maintenance, warranty, or service-callback offering to past clients. A remodeler with 29 years of customers sitting on a valuable client list can add higher-margin service work that smooths out the lumpy project cycle.
Tighten job costing and gross margin tracking per project. Small contractors often leave margin on the table with weak change-order discipline and material markup, and a system to track cost-to-complete can add points to the bottom line.
Expand into adjacent high-ticket remodel categories (kitchen, bath, ADU construction) that this affluent market demands. California ADU legislation has created a durable renovation niche that an established local contractor is well positioned to capture.

Diligence notes

Quantify owner dependence directly. Determine how many of the current jobs the owner personally sold, estimated, or managed, and whether the customer relationships and referral sources transfer to a new owner, because this is the biggest risk to the $544,106 cash flow figure.
Reconcile the three-year revenue swing with tax returns and job logs. Confirm the 2025 $2.04 million and 2024 $1.91 million against filed returns, and understand whether the higher 2023 number is repeatable or a one-time surge.
Verify the $544,106 owner income and what it includes. Get a full add-back schedule and confirm the figure is true SDE after a market-rate replacement for the owner's labor, since an owner who is both salesperson and manager may require a costly hire to replace.
Confirm licensing, insurance, and workers comp status. California requires a CSLB contractor license, and you need to verify it can be transferred or that the buyer or a qualifying employee can hold it, plus review any past claims, liens, or warranty liabilities.
Review the lease and building situation. The owner owns the building but the sale is a leased arrangement at $6,000 per month, so confirm the lease terms, whether the retiring owner remains the landlord, and the renewal risk on that 2,000 square foot facility.
Assess staff retention beyond the seller's assurance. Interview the 6 employees where possible, understand key-person risk among the estimators and lead carpenters, and consider retention agreements to lock in the team the deal thesis depends on.

Source

Originally listed on BizBuySell. View original listing →