A plumbing business is basically made by plumbers, most of plumbing owners invest in employees to offer the best service to their customers.
At the same time, plumbing businesses also have to invest in equipment, tools and up-to-date machinery if required. It’s not an easy business to run, for sure, but it can be very profitable, as there is a very large market to be explored in the United States.
But to make it even more profitable, plumbing owners have to value their business and learn how to sell it for the best price.
What is your Plumbing Business worth?
In order to know exactly what your plumbing business is worth, first you have to find out how is your finance situation. To do that, gather the last three to five years numbers and compile them into a bigger report, where you will also include information regarding other plumbing businesses in your surroundings.
For you to don’t get lost, take a look at the following metrics:
- What are the sales?
- What is the profit?
- What are the growth trends?
- What is driving new sales and is that sustainable?
- What channels do new customers come from and what is the breakdown of each channel?
- What is your market position?
- Is your Location favorable?
- How reliant is the business on the owner?
- What systems and processes are in place to run the business?
What makes a Plumbing Business worth more?
Before setting your asking price, you can’t rely on your business valuation if you don’t take into account the key factors that make your plumbing business worth even more. But which aspects are those? Check these out:
- Predictable key drivers of new sales
- Stable or growing traffic from diversified sources
- Established suppliers of inventory with backup suppliers in place
- Traffic stats
- High percentage of repeat visitors and repeat sales
- Clean legal history
- Brand with trademark, copyright or legal concerns
- Documented systems and processes
- Growth potential
What does the average Plumbing Business sell for?
Since 2005, when our research began, there have been only 54 plumbing business sales in the United States. For a very popular and necessary business model, the sales number was quite small, but that happens because most of plumbers work independently.
Despite that, it is a very, very profitable business, as you can see by looking at the average sales price, up to $732k and average multiple rate, at 2.30.
What is the most frequent deal size?
The most frequent deal size is more than a half smaller than average sales price: $300k. It means that it’s more likely you sell your business for $300k than for its average sales price.
Is the Plumbing Business market getting bigger?
It is too soon to ensure that, but 2015 was the best year for plumbing business in the United States by far. 2014 was also a very good year, but not as good as 2011 and 2012, for example.
For now, it’s possible to say that plumbing business is living a good moment and it might be a good idea for you to sell it right now. But remember: in order to take the best offer and sell your business for the best price possible, you must do your business proper valuation.
Are bigger businesses worth more?
Yes, with very few exceptions. The rule is: the bigger the business, the higher will be the profit you will get from the sale. Sometimes, however, it happens that a bigger plumbing business, valued at a higher price than the others, have a lower profit than a smaller business.
What states have the most Plumbing Business deals?
Are you wondering where the most deals were made throughout the country, or if your state has a hot market to sell fast? As you can see if you are located in California or Florida, you may get a lot more offers than if you are in Arizona or Ohio. But sometimes you can overcome the low number of deals with investors or competitors looking to enter a specific new area, and get lucky with an offer.
Why would you sell in the first place?
The reason to sell always varies from each person. Maybe you are looking for new challenges, businesses and opportunities, or you just want to enjoy your family and retire. Although it can seem tempting to get your hard worked cash, make sure that you are clear on the motives so you don’t regret afterwards.
How long will it take to sell your Plumbing Business?
If you have read all the necessary steps to understand your valuation, and think you have focused on all the topics that make your company worth more, it is maybe time to start the process. Selling your business is a long-term process, and doesn’t happen overnight. Usually companies sell in 12 months, but you can also see deals getting closed in 6 to 9 months depending on the opportunity.
What is the process of selling your business?
This step by step process will help you get less confused when you make sure you are ready and confident to let go of your business, and perform a nice and positive sell. Many entrepreneurs forget about a step, or just don’t have the right guidance to know all the stages necessary and get lost through the process. Don’t forget to go through all of these, and if you have any questions, comment at the end of the article or contact us for more help.
Who will buy your business?
If you are wondering about the buyers that can be interested in your Plumbing Business, don’t worry, there are many options and possibilities. From First Time entrepreneurs, to businessmen interested in new opportunities, the chances are that in the plumber industry it may likely be a person who already had a store in the field.
Plumbing businesses are mostly made of people, and most of plumbers in the United States work independently. However, it is a very profitable business, as average sales price is up to $700k and most frequent deal size is $300k.
If you want to start accelerating your buyout process, fill out our free valuation form and get your business valued today! Leave your comments on any doubts or feedback, we are glad to hear your thoughts.