Examine biz mix when valuing HVAC companies

BVWireIssue #179-3
August 16, 2017

“Mix drives value," according to one expert's experience when selling and valuing HVAC contractors. Prices for these firms can range from under 10% of revenue to over 100% of revenue—it depends a great deal on the mix of business. For example, a higher percentage of business associated with residential “service work” drives value. The number of active residential service (maintenance) agreements holds value. A heavy dependence on new construction depletes value. Commercial service work helps value—if it’s ongoing and can be proven.

Outlook: Another expert talks about future trends: "The value of qualified HVAC companies (and trade companies in general) is on the rise, due to the lower number of people interested in becoming HVAC technicians/tradesmen. The average cost of this service will rise significantly over the next 10 years, making this industry prime for consolidations, mergers and buyouts.”

For more Information, see the newly released BVR special report, What It's Worth: Valuing HVAC Companies.

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