Site-Clearing & Land Preparation Contractor, 28-Year North Florida Operator

$3.5M

Revenue

$1.2M

SDE

3.4x

Multiple

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Full Editorial Writeup

This is a 28-year-old site-clearing and land preparation contractor operating in North Florida since 1998. The company does the dirty, unglamorous work that comes before anything gets built: clearing trees and brush, grading, and prepping raw land for development. It serves 20 to 30 customers a year with no single account above 10% of revenue, and wins new work through bid services backed by a high rate of repeat customers.

The economics are attractive on paper. On roughly $3.5M of revenue the business throws off $1.18M in cash flow, a 34% margin that is strong for heavy construction and signals real pricing discipline and equipment utilization. The sale conveys $1.9M of well-maintained equipment, a seasoned W2 crew with meaningful tenure, and a stated backlog, so a buyer inherits an operating machine rather than a project to rebuild.

The deal is packaged for a leveraged buyer: SBA prequalified at 10% down with generous seller financing and a seller willing to stay on. At a 3.39x cash flow multiple the price is reasonable for the category, though the buyer is really underwriting Florida development activity, which is cyclical and rate-sensitive.

Why we like it

Earnings quality is the headline. A 34% cash flow margin on $3.5M of revenue is well above typical heavy-construction comps, and the customer base is diversified across 20 to 30 accounts with none above 10%, which lowers concentration risk versus most contractors this size.
The moat is the crew and the equipment. A long-tenured W2 team in a skilled trade with $1.9M of owned, well-maintained equipment is hard to replicate quickly, and the 28-year reputation drives repeat bidding wins that a new entrant cannot buy.
Deal structure protects the downside. SBA prequalification at 10% down plus generous seller financing means the buyer risks less equity, and a seller willing to stay onboard de-risks the transfer of bid relationships and crew loyalty.
Florida land development remains a durable tailwind over the long run. Population and construction migration into North Florida support ongoing demand for site prep, and the scalable model with stated excess capacity gives an operator room to add crews and expand geography.

How to improve it

Build a real bid pipeline and estimating discipline. The business sources work through bid services, so within 90 days install CRM tracking on win rates, bid-to-close ratios, and margin by job type to identify which project profiles actually drive the 34% margin and lean into them.
Diversify revenue mix toward recurring or repeat contract work. Site clearing is inherently one-off, so pursue master service agreements with large developers, homebuilders, and municipalities to create predictable backlog rather than rebidding every project cold.
Push equipment utilization and reduce idle time. With $1.9M of equipment on the books, track hours and revenue per machine, add a second shift or seasonal rentals to smooth capacity, and consider selling or replacing underutilized units to free cash.
Formalize the succession of the key crew. Long tenure is an asset and a risk, so within the first year document processes, cross-train operators, and put retention incentives on the most critical foremen so the value does not walk out the door.
Expand service scope adjacently. Add grading, demolition, erosion control, or hauling to capture more wallet share per developer relationship, increasing revenue per customer without the cost of acquiring new accounts.
Tighten working capital and job costing. Heavy construction ties up cash in receivables and progress billings, so implement milestone billing, faster collections, and per-job P&L to protect the cash flow that justifies the price.

Diligence notes

Verify the cash flow number and its normalization. A 34% margin is high for site clearing, so confirm the $1.18M is true owner earnings after fair market management wages, equipment maintenance capex, and that no owner labor is being underpriced into the SDE.
Scrutinize equipment condition and remaining life. The $1.9M equipment value drives a large part of the price, so get an independent appraisal, review maintenance logs, and estimate near-term replacement capex since worn-out machines can wipe out reported cash flow.
Test the backlog and revenue durability. Confirm the stated strong backlog with signed contracts and start dates, and review three years of revenue by customer to validate the repeat-customer claim and the no-single-customer-over-10% concentration figure.
Assess cyclicality and rate sensitivity. This business is tied to Florida land development, so review how revenue and margin held through prior slowdowns and stress test the SBA debt service against a downturn in construction starts.
Confirm the seller transition terms and crew retention risk. Get specifics on how long the seller stays, what bid relationships transfer, and whether key operators are under any retention or non-compete, since crew departure is the single biggest post-close threat.

Source

Originally listed on BusinessBroker.net. View original listing →