Tips For Your First Home Service Acquisition! ✏️

Acquisition is the first step on the home service journey for many of our readers. That’s also easier said than done. If you’re beginning that process, I have actionable tips and self-reflection questions to consider along the way.

Time to talk about acquisitions.

Let’s do it.

• Buy or Build?
  • Know what you want.
• The Search Begins
  • Vendors, social media, and more
• Finances In Order
  • What are you buying? Be sure.
• The Story So Far
  • Know what that business is already doing.

Build versus Buy

The first question you’ll need to answer.

Ten times out of ten I’m going to buy over build. Why?

• Do it overnight: Why wait a year or more to get off the ground? Spend, and get going right away.
• Systems in place: Acquiring means that systems are already in place that won’t need to be built from the ground up. Hopefully. Ad spend, lead gen, personnel. Etc.
• Installed reputation: Ideally, one of the best reasons to buy is that customers, vendors already know that company/brand.

But be ready to ask yourself: Are you willing to take on the challenges that come with a ‘known’ quantity? More on that below.

But let’s say you have the rest figured out. Where does the search start?

It’s time to get digging.

The Great Acquisition Race

Part of getting the process going is finding a business that’s looking to sell.

Now, you could be particular about the search and create a profile of your dream business.

But dreams often aren’t real. Doing so runs the risk of creating expectations that no company can meet. Instead:

Talk local: Vendors, peers, and more are all good sources to start the search. Who is looking to unload? What’s out there? Where is there a gap?

Questions to Consider: Are they commercial or residential? Service or new construction? Where is your location? How do you want to approach the search? Are you using a company’s Google reviews as a metric for them being purchasable?

Questioning the Business

Perhaps the biggest part of how to acquire your first home service business is knowing what and who you’re getting into bed with.

Keep in mind the following:

Financial health: What is the revenue consistency, profitability, and liabilities?

Due diligence: Common practice is buying companies at 3x their earnings, then selling at 5x earnings.

What’s the noose: Will you be on the hook for any hanging swords? Find out.

The First 90 Days

Do some vision training. If you buy, what does the first three months look like?

Things to consider include:

• Technology in place
• Marketing/lead gen being used
• Conversion: Will you have to go from commercial to service?
• Scaling: Are you building to sell or building to expand? Figure it out.

All of these questions need answers before you ever buy. Good luck.