Should I Sell My Contracting Business Now?
- Tawni Nguyen
- Jul 26
- 3 min read
Q: I’ve been running my business through supply chain chaos, wage hikes, and permit delays. How do I even know if now is the right time to sell?
A: If you’re asking the question, it’s already on your mind. The truth is, most businesses don’t sell well when the owner is burnt out or "ready to sell." But if you’re even thinking about exiting in the next 2–5 years, the smartest move is to start prepping now—not when you’re over it.
Q: Is there actually buyer demand in 2025?
A: Yes. In Q2 alone, the Southwest saw strategic buyers scoop up essential service companies across lighting, signage, propane, and environmental trades—many of them off-market. One advisory firm reported 40+ active rollups and over 20 deals in pipeline.
Buyers are favoring:
Clean books
Recurring revenue
Operational discipline
(Source: KSM Q2 2025 M&A Report)
Q: What makes a contracting business valuable right now?
A: Buyers aren’t paying for your truck—they’re paying for what you’ve built. High-value indicators include:
Clear job costing & estimating systems
Maintenance/service contracts
A crew that operates without you
Project pipeline and backlog visibility
If the business only runs with you in the center, it’s not a business—it’s a job.
Q: How do I improve my valuation?
A: Start with your numbers:
Normalize EBITDA (remove one-offs and owner perks)
Track job-level profitability
Clean inventory and financial reports
As of Q3, M&A multiples for $1M–$3M EBITDA trades are 4.8x–6.3x (Source: GF Data).
Q: What market forces are affecting buyer behavior?
A: Plenty. Here are the big ones:
HVAC equipment costs up 7.1% YoY (AHRI)
64% of deals now include rollovers or earnouts (Pitchbook, June 2025)
Labor shortages continue to raise journeyman wages (BLS: $37.25/hr average)
Buyers want stability. That means clean books, strong teams, and predictable revenue.
Q: What should I do before I try to sell?
A: Build your team early:
CPA with M&A experience
Legal advisor to structure contracts
Strategic partner or industry-aligned advisor
Deals fall apart in due diligence. Don’t let sloppy docs kill a great offer.
Q: What are my exit options?
A: There’s more than one way to sell:
Full exit: Walk away after transition
Stay-on: Shift into a strategy role
Rollover equity: Sell majority, keep upside
In Q2, many owners chose partial exits (selling 60–80% and staying in as growth partners).
Q: What’s happening in the Las Vegas construction market?
A: A lot:
Material costs up 10% across plumbing and HVAC
Construction costs up 4.13% YoY (Rider Levett Bucknall)
Local labor shortages intensifying with 439K+ national shortfall (ABC Workforce Report)
Tariff volatility affecting electrical/plumbing bids
If you’ve got a stable crew, clean books, and local market presence—your business is likely on a buyer’s radar.
Q: What documents should I prepare before due diligence?
A:
Valid licenses
Insurance, OSHA/safety records
Subcontractor and payroll agreements
Backlog, WIP reports, and org chart
Buyers will dig deep. Be ready to prove what’s under the hood.
Q: What’s the timeline to plan a successful exit?
A:
Phase | What to Do | Why It Matters |
12–24 months | Clean books, reduce owner role | Boosts valuation and buyer trust |
6–12 months | Clarify goals, structure the deal | Aligns outcome with your long-term legacy |
0–6 months | Build your team, prep diligence | Prevents delays and deal-breakers |
Don’t treat your exit like a fire sale.
You don’t need to know all the answers—just ask the right questions early.
If you’re a contractor with $1M+ EBITDA and want to talk options, we’re here to help. No pressure. No brokers. Just the straight answers you deserve.
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