Skip to content
All sample deals
Fictional sample dealIntermediate

Clearwater Pool Service

Recurring route-based services · Sun Belt metro, Southwest US

Route-based weekly pool cleaning and maintenance business with about 900 residential accounts on recurring monthly plans. Annual churn is under 8% and no account is more than 1% of revenue.

Ten route technicians, a route manager who handles scheduling and hiring, and a part-time office assistant. The owner focuses on equipment-repair upsells and sales. The broker calls it “the cleanest recurring-revenue business we’ve listed this year” and is asking 4.6x SDE.

  • 92% of revenue is recurring monthly service plans
  • Annual account churn under 8%
  • Route manager has been with the company 7 years
  • Fleet of 11 trucks, replaced on a rolling 6-year cycle
  • Owner is open to “some seller financing”
The numbers, as presented
From the broker’s package. Nothing here has been verified.
Asking price
$2,600,000
Revenue
$1,900,000
SDE (stated)
$560,000
Multiple
4.64x SDE
YearRevenueSDE (seller-reported)
Two years ago$1,680,000$490,000
Last year$1,800,000$530,000
Most recent year$1,900,000$560,000

Add-backs in the seller’s SDE

  • Owner salary and payroll taxes$120,000
  • Depreciation on the fleet$55,000

Assumptions for this exercise

SBA 7(a) loan at 10.5% over 10 years, with 10% of total project cost (price plus working capital and closing costs) as your equity injection. Working capital $40,000, closing costs $70,000. A market salary to run the business is $80,000 a year, and ongoing equipment spending is $50,000 a year.

Your evaluation
Answer all five, then see how an experienced buyer called it.
1. Would you pursue this deal?
2. What price range would you offer?

If you’d pass at the asking price, give the range you’d consider if the seller re-priced. “1.1M” or “950k” work too.

3. What are the top risks? (pick up to 3)
4. What would you ask the broker first? (pick up to 3)
5. Estimate the DSCR

At the asking price, on the seller’s stated SDE, using the assumptions above: cash flow after the market salary and equipment spending, divided by a year of loan payments. The SBA floor is 1.25x.

x

Every sample deal is fictional: the businesses, names, places and numbers are invented for practice, and any resemblance to a real business is coincidental. The simulator is educational, not advice. It isn’t legal, tax, financial, investment or lending advice, and real deals deserve review by a qualified attorney, accountant and lender.

We use analytics cookies to understand how visitors use numanknows. See our Privacy Policy for details.