Extremely Reputable Home Inspection Business – $87,663 Earning
Consistent 3 Year Average of $183,055 in Sales and 54% Profit Margin in 2021
Specifications
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Price: $240,000 |
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Revenue: $177,440 (3 Year Avg.) |
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Cash Flow: $87,663 (3 Year Avg.) |
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Location: San Francisco Bay Area |
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Service Area: San Francisco Bay Area |
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Profit Margin: 49% |
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Employees: 1 Full Time, 1 Part Time |
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Reason for Sale: The Seller is Retiring |
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Goodwill: 16 Year Reputation |
This well-established, often referred home inspection business has been serving Santa Clara County, Alameda County, and surrounding areas for 16 years. They are the “Go To” inspectors for single family homes, town houses, condos, mobile homes, and apartment buildings.
Demand continues to be strong for inspections, with almost every property being sold, there is a request from the seller, buyer, lender, or other interested party. Commercial and business inspections are a source of new clients that remain to be pursued and would increase sales. Two apartment building inspections have been completed already in 2022 towards capturing that segment of the business.
2021 sales included the following inspections, 106 single family dwellings, 65 condos, 17 town houses, and 323 mobile homes, for a total of 511 total inspections. Inspection services are required during the sale of a home, for approving work of contractors, providing evidence for insurance claims, HOA, community and local department of housing compliance; several revenue streams which support the notion that the growth potential for this business is very realistic and achievable.
Value Proposition
- 16 years of established reputation
- Exceptional customer reviews
- 49% average profit margin on $183,055 revenue
- Priced Below Market for Quick Sale – Retirement
- Unique, profitable business without inventory
- Realistic growth potential
- Niche market
- Easy to train additional or new inspectors
Revenue Breakdown
Financial Highlights
- Listing price $240,000
- Truck, equipment, and software included
- 3 year average revenue 183,055
- 3 year average cash flow $87,663
- 3 year average profit margin 49%
Cashflow Analysis
Asking Price
The asking price is determined using a cash flow methodology. Cash flow is the sum of net income from the business plus any non-cash expenses, non-recurring items and any seller’s personal expenses. A multi-factor multiplier is applied to the cash flow based on the condition of the business.
For this business, a three-year average cash flow is applied making the business price more favorable to the buyer. The multiplier applied in this case is 2.74x, below the market in favor of the buyer.
Funding Example
Purchase Price: $240,000
20% Buyer Down Payment
$48,000
Buyer’s Equity
80% Bank Loan
$192,000
10-Yearterm at a rate of 5.50% = Monthly loan payment of $2,083.70
- Cash Flow (SDE) 3-year average 87,663
- Annual Payment to Bank: $25,004.40
- Net Profit (After Expenses and loan payment): $62,658.60
* Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available.
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