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What are the 2-3 Most Common Hurdles When Selling a Restoration Business?

Q: What are the 2-3 most common hurdles when selling a restoration business?

JT says: Restoration businesses vary widely in size, services, accounting methods, cultures, owner involvement and more.  Considering this variety, the following typically gives buyers and lenders the most heartburn:

Inconsistent Sales:  Likely resulting from a large weather event, LL/CAT project, it creates uncertainty when determining an accurate Adjusted EBITDA/Cash Flow.

Improper Accounting:  Possibly ‘kitchen table’ accounting, or more complex issues- Timing of revenue recognition, WIP adjustments, overhead allocations, etc.  

Owner Involvement:  Owners of smaller companies (often husband/wife teams) wear many hats, replacing their knowledgebase, skillsets and responsibilities can be daunting.

The above issues do not automatically mean a business is not saleable.  Extra planning is simply needed for the best possible outcome.  

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