Well Established Commercial Plumbing Company, 15-Year Middle Tennessee Contractor

$4.5M

Revenue

$850K

SDE

Subscribe Free

Read the full deal writeup

Get Free Access

Already a member? Sign in

Full Editorial Writeup

This is a commercial plumbing contractor operating in Williamson County, Tennessee, one of the fastest growing corridors in the Southeast. Founded in 2010, the business has spent more than a decade building relationships with general contractors and developers on new build commercial projects. Revenue runs $4.5M with reported cash flow of $850K, an 18.9% margin that is respectable for a project-based trades firm carrying a 20-person crew.

The focus is deliberately on new construction rather than emergency service repair. That means predictable scheduling and larger contracted jobs, but it also means the revenue is project-by-project and tied to the health of the local commercial building pipeline. The moat here is the roster of repeat GC and developer relationships plus a licensed, staffed crew in a market where skilled plumbing labor is scarce.

The seller owns the 6,000 SF facility, valued at $1.2M, but that real estate is explicitly not included in the asking price. FF&E of roughly $1M and modest inventory of $11K are included. The reason for sale is a relocation to be closer to family, and seller financing is available, which signals confidence and gives a buyer a structural cushion.

Why we like it

Earnings quality is solid for the trade, with $850K of cash flow on $4.5M of revenue and a 20-person crew already in place. The work-in-progress pipeline means revenue flows from day one rather than a buyer inheriting a cold pipeline. FF&E of roughly $1M is included, so the hard asset base supports operations without additional capex on day one.
The moat is the 15-year book of general contractor and developer relationships, which take years to earn and give the business repeat call-when-we-build credibility. Skilled, licensed plumbing labor is the true constraint in this trade, and inheriting a staffed 20-person crew is worth more than the equipment. New construction focus means larger, higher-margin contracted jobs versus reactive break-fix work.
Middle Tennessee is one of the strongest commercial construction markets in the country, with sustained population and business migration into the Nashville and Williamson County corridor. That structural demand tailwind directly feeds a new-build plumbing contractor. As long as cranes are up in the region, this crew has work.
Seller financing is on the table and the reason for sale is personal relocation, not a distressed exit or a declining business. That combination lets a buyer structure the deal with the seller carrying paper, aligning incentives through the transition. Plumbing is a licensed, essential trade with durable long-run demand.

How to improve it

Layer in a service and maintenance division to complement the new-build work. Recurring service contracts on the very buildings this crew plumbs would smooth the project-driven revenue and add higher-margin, repeat-billing income that raises the exit multiple.
Formalize the customer concentration picture and diversify the GC base within the first 90 days. If a handful of developers drive most revenue, actively bid work with new general contractors to reduce dependence on any single relationship that could walk with the departing owner.
Build a project-level job costing and margin dashboard. Many trades firms run on gut feel; instrumenting bid-to-actual margins by project lets a new owner kill unprofitable job types and double down on the highest-margin commercial work.
Invest in recruiting and apprenticeship to grow the crew, since labor is the binding constraint on revenue in this market. Every additional licensed plumber this business can field is directly convertible into more contracted backlog given the demand environment.
Negotiate a lease on the seller-owned building rather than letting the $1.2M facility become a separate deal complication. Locking a long-term lease at a market rate keeps operations stable, preserves cash for growth, and avoids inflating the transaction with real estate a buyer may not want to own.
Tighten collections and manage working capital on progress billing. New construction contracts often carry retention and slow-pay cycles, so improving billing cadence and retainage recovery can free meaningful cash without changing a single job.

Diligence notes

Verify the $850K cash flow and reconcile it to tax returns and bank statements, since project-based trades revenue can swing hard year to year. Ask for three years of financials and a monthly revenue trend to confirm the pipeline is stable and not front-loaded by one large job.
Examine customer concentration among general contractors and developers. Relationships cultivated by the owner over 15 years are the core asset, so confirm which are contractual, which are informal, and whether they transfer when the owner leaves for family reasons.
Confirm the status and value of work in progress and backlog. Get the current signed contracts, remaining contract value, expected completion timelines, and any retention held, because inherited WIP is a large part of what a buyer is paying for.
Review licensing, bonding, and the crew. Confirm the master plumber license situation (does it depend on the owner personally), that key licensed staff intend to stay, and that bonding capacity supports the current project scale.
Clarify the real estate arrangement, since the $1.2M building is owned but excluded from the asking price. Nail down lease terms, rent, and length before closing so a buyer is not exposed to a landlord who could raise rent or force a costly relocation.

Source

Originally listed on BizBuySell. View original listing →