Experience acquiring a skilled trades business

by a professional

1 year ago

Hi all,

A client of mine is in late stage conversations to acquire a commercial electrical service business from a retiring owner.  There are tons of opportunities for growth and efficiencies (no sales, no marketing, minimal software, no performance metrics, etc), but he does not come from a skilled trades background. Has anyone without a skilled trades background acquired a similar business, and if so, would you mind sharing their insights on how it has turned out / how you closed the technical gap? For example, did you get licensed? Thanks in advance!

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investor from Columbia University

Good questions. I've worked on a number HVAC and construction deals. It's essential you have a licensing approach and there are several you can take. But you don't want to be held hostage over this in negotiation. Contract me for some ideas.

3 months ago | like reply | 0 likes

searcher from The University of North Carolina at Chapel Hill - Kenan-Flagler Business School

I acquired a specialty trade business, without prior knowledge and got trained but never compares to 20 years of experience. The key man risk issue is definitely a major concern because trades are high turnover industries, and there is a severe shortage of skilled labor in most sectors. So if your client does not want, or doesn't have the knowledge and experience necessary, to get licensed you have to include having at least 2 licensed employees in your model. Employees tend to ask for more money when they know you need them, having 2 reduces the risk there.

3 months ago | like reply | 1 like

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