Ever had a deal haunt you because you hesitated? Tell you about the $3.5M trucking company I missed out on—and the lessons it taught me.
I was recently looking at a trucking company that provides same-day courier services in Southern California.
The deal first came to market 8 months ago, and I passed on it. But something about it stayed with me. I revisited it a month ago, but by the time I got back, it was too late—it was already under contract.
Here’s the breakdown of the deal:
The Numbers
• Established: 1988(checks more that 8 years of being established)
• Listing Price: $3,500,000
• Services: Same-day courier, refrigerated transport, legal courier, medical delivery, cargo logistics.
• Team: 25+ employees, 10–15 contractors
• Fleet: 8 company-owned vehicles (16-foot refrigerated box truck + cargo vans).
• Revenue (2023): $3,076,858
• Cash Flow (SDE): $801,566
• EBITDA: $701,566
• Margins: Consistent profitability with discretionary earnings exceeding 25%.
Where I Hesitated
When I first saw this deal, I thought, “I know trucking, but do I understand the nuances of same-day delivery?” So, I did what I should’ve done earlier: called industry experts.
Here’s what they told me to look out for:
1. Customer Mix & Pricing Power:
• Are margins this high because of pricing power or poor cost representation?
2. Depreciation Mystery:
• No depreciation listed? That means the fleet might be old or they didn’t account for it properly.
3. Add-Backs:
• Every deal has them, but not all will pass the lender’s scrutiny.
4. Real Estate Situation:
• Does the business own or lease its location? Do pickup/delivery logistics depend on it in the long term?
5. Third-Party Driver Contracts:
• Are there set rates for pickups/deliveries, or is pricing negotiated per transaction?
6. Revenue Breakdown:
• What’s the split between on-demand, courier, and scheduled services? How much revenue is recurring?
-What is the cost per delivery
-How optimized are the routes?
7. Fleet & Expansion Readiness:
• Are capital investments needed soon? Can the fleet/staff support growth?
What I Offered
Based on my analysis and due diligence, I structured the following offer:
• Purchase Price: $2,000,000
• Structure:
• $1,800,000 upfront at closing (90%)
• $200,000 seller note (10%) at 6% interest, payable over 10 years with the first 2 years on full standby (no payments).
The offer was rejected—the business was already under contract.
The Lessons I Learned
1. Don’t Wait:
• If you’re interested, submit an offer early. Dig deeper after you’ve locked in exclusivity.
2. Ask Experts:
• Industry experts can quickly uncover risks and opportunities you might miss.
3. Be Ready to Walk Away:
• Even with a great deal, if the numbers don’t work, stick to your offer.
I missed this deal, but the experience sharpened my diligence process and taught me invaluable lessons.
Have you ever let a deal slip through your fingers? What did you learn from it? Drop your lessons in the comments! or Just Give some Advice!
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