Then again, if you don’t do mergers and acquisitions for a living, looking for an HVAC business for sale can be confusing at first. There’s always a gap between how companies present themselves and their bottom line; not all of them are a great fit for your needs and budget. Then again, there are a few different ways to make the best buying decision, and the best option for you will depend on your circumstances.
We’ll start by breaking down where to find good HVAC businesses for sale and how to determine the ones that could become an excellent purchase, followed by crucial questions you should ask before signing the contract.
Questions you should ask yourself first
What kind of HVAC business are you looking to buy?
- HVAC service businesses
- HVAC equipment/part distributors or manufacturers
- Heating and ventilation tech companies
- Energy reduction analytic technologies
- HVAC commercial/residential companies
Why do you want to buy an HVAC business?
Are you a business looking to expand or an experienced tech looking to start his own gig? And maybe you’re just looking for an in-house supplier? If you have proven managerial experience, perhaps you can afford to have employees with no executive experience of their own. Maybe you can even afford to have a business in a different state (that you can manage with Workiz’s Franchise Management feature). On the other hand, if you’re just looking to have your own business without starting it from scratch, look for a company run by a manager who is also a business partner.
That being said, if the business you’re considering to be is more of an exclusive partner (a tech you’d like to use as a competitive advantage, for example), then you should also make sure your clients can make good use of what that potential partner has to offer. You don’t want to fancy yourself with a brand new purchase only to discover there is no demand or use for it. If you’re unsure about the industry you’re dealing with or the product you’re looking into, don’t hesitate to consult an expert.
What is your budget?
Whatever cash you have in store, when buying an HVAC business, you’ll need to factor in the price of the business plus the cost of living and working in the area where the company is located. If you’re looking at businesses in different states, remember that the cost of living and doing business can vary significantly from one state to another. And don’t forget the competition, as a strong competitor can make your success a brutal struggle even if the market looks promising.
What are your goals?
Be clear about what you want to achieve by purchasing an HVAC business. Are you looking for a company that will provide you with a steady income, or are you hoping to grow the business and sell it at a profit down the line? What are your long-term goals for the company? You can determine them using this business plan.
How can you track these goals?
Set yourself a deadline – say, one year after buying a business, to confirm whether you have or haven’t achieved that goal (in terms of income, value, or positioning). Having the goal and the deadline in mind should help you review the current state of the business you’re about to buy and determine whether that purchase should hit these goals by the following year or so.
Where to find HVAC businesses for sale?
Search online listings
Websites like BizBuySell, LoopNet, and BizQuest have extensive listings of businesses for sale in various industries, including HVAC. You can use the search filters on these websites to narrow down your options and find companies that fit your criteria.
Contact a broker specializing in HVAC businesses
Same as with real estate brokers, there are professionals out there whose entire specialty is to find businesses that are a good fit for your needs and budget in exchange for a fee.
Ask colleagues from the industry
As a service provider, you know how important it is to never underestimate the power of a word-to-mouth recommendation. Ask acquaintances from the industry whether they have heard of some profitable business for sale and how they know it’s profitable.
What to look for when buying an HVAC business?
The following are some critical factors to consider when evaluating an HVAC business for sale:
The financial health of the business
Be sure to review the financial statements of the business you’re considering purchasing by an accountant, a lawyer, or someone who knows their way around financial reports. This will give you a good idea of the company’s revenue, expenses, and profitability.
Employee experience and tenure
Be sure to ask about the employees of the company you’re considering purchasing. How long have they been with the company? What is their experience in the HVAC industry? Do they have the necessary licenses and certifications to do their job? Remember that every trained employee you don’t have at the moment will later cost you the time it takes to find, hire, and train one.
The quality of the HVAC equipment
Be sure to ask about the quality of the HVAC equipment that the company uses, including its vans, ducts, and tools. Are they well-maintained and up-to-date? Do they meet industry standards? Remember that every outdated and missing piece of equipment will later cost you in expensive purchases.
The reputation of the HVAC company
Be sure to ask about the reputation of the HVAC company. What do their customers say about them? Are they known for providing good quality service? Are they known for being fair and honest?
The size of the HVAC company
Be sure to ask how many employees this company has and what is their customer base like? Are they a small, local company or a large, national chain?
The price of the HVAC business
Finally, be sure to ask about the price of the HVAC business. Is it a fair price? Are there any hidden costs? What is the payment schedule? And most importantly, what is the average revenue you can expect per job – and could it possibly cover the costs?
By doing your research and asking the right questions, you can feel more confident that you’re getting a good deal on a quality business. The more mission-oriented you’ll be about buying an HVAC business, the better purchase you’re likely to make.
And as your business expands, you might as well look into a new option of staying on top of all operations. Workiz can help with many aspects of running a growing home service business – from managing techs and dispatchers across multiple locations to managing inventory and even tracking leads and revenue.
Workiz is built for HVAC businesses made to last, and thanks to its easy-to-use interface, all new employees should have no problem adjusting to it. Give Workiz a 7-day free trial to test it for yourself, or book a free demo to see the platform in action.