Home Remodels & Additions with over $1.1M in Sales in 2020
Year-over-year sales growth since 2017!
This home remodeling company in Lincoln has had year-over-year sales growth since 2017 and a 23% profit margin in 2020! This well-established business specializes in kitchen and bath remodels, additions, finish carpentry, and custom cabinetry design and installation. Serving Lincoln and surrounding communities for nearly 30 years, this highly skilled design staff offers an unmatched experience from beginning to end. Clients include remodeling homeowners looking for a tune-up or additions, and residential/commercial contractors looking for interior finishes in a newly built home. A solid team is already in place; an office manager handles all incoming phone calls and e-mails from new and existing clients, as well as quoting, invoicing, scheduling, and ordering. A project manager runs the jobs on site, and 6 experienced laborers make sure the work is top notch from start to finish.
Home remodeling and additions account for 50% of their revenue, 40% is finish carpentry, and 10% custom cabinetry. Assets include $78,000 worth of portable equipment, shop equipment, and hand tools used by three crews of laborers.
Growth opportunities are endless. Adding another project manager would allow the company to take on more jobs. The demand for home remodeling and additions has increased in recent months due to lower interest rates on home loans and construction loans. Priced at $640,000, a 10% down payment of $64,000 returns $182,355 in the first year after debt payments – a 285% return on investment.
- Residential/commercial contractors
- Remodeling homeowners
Average Sale Size/Range:
- Remodels/Additions: $80k-$130k
- Interior Finish: $8k-$12k
- Custom Cabinetry: $30k
Year Established: 1992
Location: Lincoln, Nebraska
Service Area: Lincoln and surrounding communities within 30-mile radius
Services: Home remodeling & additions, finish carpentry, custom cabinetry
Clients: Remodeling homeowners & residential/commercial contractors
Lease: 3,500 sq. ft.
Reason for Selling: Retirement planning
Personnel: 9: 1 owner, 1 office manager, 1 project manager, 6 laborers
Seller Training Period: 6 months - 1year
Growth Opportunities: Add another project manager to take on more remodels.
Current Owner’s Responsibilities: Works 30 hours/week; meeting with staff, initial meetings with clients and project manager, visiting job sites at various stages of the project for quality assurance
- List Price: $645,000
- 2020 Cash Flow: $264,884
*amounts may vary
Cash Flow Analysis
|Description of Financial Statement||P&L Statement|
Jan-Dec 2020 Cash
|Net Income Shown on Financial Statement||$130,877||$-44,776||$100,880||$2,975|
|Compensation to Owner||$28,750||$57,500||$14,000||$62,170|
|11% Tax on total W2 Salaries||$3,163||$6,325||$1,540||$6,839|
|Meals & Entertainment||$367||$1,161||$689||$698|
|Auto-Personal Use||$13,365||$22,439||$23,075||$11,612||100% Personal|
|Director's Fee||$0||$0||$28,000||$0||Paid to Owner|
|One-Time Building Expense||$100,327||$107,377||$0||$0|
|Rent Adjustment||$-13,000||$10,700||$10,700||$3,200||$13k/year onward going|
|Seller's Cash Flow = Total Addbacks + Net Income||$264,884||$162,876||$183,090||$93,437|
|Profit Margin||22.55 %||16.48 %||25.50 %||15.18 %|
- Remodeling Homeowners
- Residential/Commercial Contractors
- Kitchen/bath remodels
- Home additions
- Finish carpentry
- Custom cabinetry
- 1 owner
- 1 office manager
- 1 project manager
- 6 laborers
- Add another project manager to allow company to take on more remodels
Offer Price: $
% Buyer Cash Down at Closing: $
% Seller Carry Back via Promissory Note: $
year term at a rate of %
% of Purchase Price secured by Buyer and Seller
Total Bank Loan Need: $
% of Purchase Price
Desired Loan Type:
Desired Bank Terms: year term at a rate of %
Total Business Assets, Inventory, and A/R: $
Total Undercollateralized Loan: $
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Fixed Charge Coverage Ratio
The bank will require a minimum ratio of 1.5 to be lendable.
2020 Cash Flow
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Buyer's Net Operating Income (NOI)
The amount of money the Buyer will retain as profit.
2020 Cash Flow
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Buyer's Return on Investment (ROI)
The rate of return on the Buyer's down payment.
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