Selling a Plumbing Services Business

Most plumbing businesses sell based on a multiple of owner earnings, but the multiple moves with plumbing-specific risk. License continuity, dispatch performance, callback control, fleet condition, and a real membership base tend to push value up. Install-heavy shops can be worth more when estimating and change orders are tight. Start with Rejigg’s free valuation calculator to get an estimate using real transaction multiples and documented owner add-backs.

No. You don’t need a broker to sell your plumbing company. Brokers usually charge 5–10% of the sale price for outreach and process work you can run yourself with the right tools. Rejigg is built for broker-free sales with vetted buyers, digital NDAs, a secure data room, and offer tracking, and it’s free for sellers. Use this walkthrough to map the process: prepare to sell your business.

Most plumbing sales take a few months from listing to closing, and longer when license continuity, permit history, or messy books slow down lender review. Speed usually comes down to how fast you can show proof on the big plumbing questions, like the qualifier plan, callback trend, dispatch metrics, fleet list, and lead mix. Rejigg keeps NDAs, messaging, and your data room in one place so you don’t lose weeks to email back-and-forth.

Often, yes. SBA 7(a) loans are common in the trades, including plumbing, when the financials are clean and the business can run without the seller acting as the dispatcher, estimator, and lead tech. Lenders still focus on license continuity, key employee stability, and whether cash flow covers the payment. You can model payments and down payment scenarios with Rejigg’s SBA loan calculator before negotiating terms.

Have documents that answer plumbing diligence quickly: financial statements, tax returns, a fleet list, licenses by jurisdiction, insurance loss runs, membership details, and key supplier terms. Add operational proof buyers ask for, like a callback log, warranty policy, and dispatch or booking reports from your field service system. Rejigg’s built-in data room is designed for structured sharing. For a closing checklist, see due diligence and closing.

Common add-backs in plumbing are owner expenses that won’t continue for a buyer, like personal vehicle costs run through the business, one-time legal or consulting fees, and non-recurring equipment purchases. Many shops also need to normalize owner pay if the owner is working as the on-call plumber or service manager. Documentation is the whole game. If you can’t show the invoice and explain why it goes away, buyers and lenders usually won’t credit it.

Seller financing means you take part of the price over time as monthly payments instead of all cash at closing. In plumbing, it often shows up when a buyer’s loan maxes out, or when the lender wants the seller to keep skin in the game. You get a potentially higher price, but you take repayment risk and wait longer to get paid. Rejigg’s offer comparison dashboard helps you weigh seller financing terms against price, timeline, and contingencies using deal negotiation guidance.

An earnout is when part of the price is paid later only if the business hits agreed targets, usually revenue or profit. In plumbing, earnouts show up when the buyer thinks demand is tied to the seller’s relationships, a short-term marketing spike, or a backlog that might not hold. They can work when the targets are simple and reporting is clear. Rejigg helps you compare earnout terms across offers and keep definitions tight so disputes are less likely.

Working capital is the cash tied up in day-to-day operations, mainly accounts receivable, inventory, and bills you haven’t paid yet. In plumbing it shows up in truck stock, parts room inventory, open commercial invoices, and deposits on installs. Buyers often expect a normal amount of working capital to stay in the business at closing so payroll and suppliers keep getting paid. Clean receivables and inventory records matter because vague numbers usually lead to conservative assumptions.

Most buyers treat trucks and equipment as part of the overall purchase, then adjust when they see near-term replacement needs. A clean fleet list with year, mileage, ownership status, and maintenance history prevents last-minute renegotiations. Specialty tools like jetters and cameras matter because they impact job speed and your ability to sell higher-ticket work. When a buyer expects immediate fleet spend, they often lower the price or push for more seller financing to cover it.

Most small plumbing deals are asset sales, where the buyer purchases assets and takes on only selected liabilities. Buyers tend to prefer that structure because it limits exposure to older claims, past permit issues, and tax problems. Sellers sometimes prefer a stock sale for tax or simplicity reasons, but many buyers won’t accept it without extra protections. Bring your CPA and attorney in early because the tax difference can be real.

Licenses and permits don’t automatically transfer just because the company sells. The buyer needs a qualifying license holder and a plan for each jurisdiction you operate in, plus a clean handoff for permits already in motion. Some deals use a temporary bridge where the seller stays employed to qualify permits for a defined period. Buyers ask early because it determines whether the business can keep working on day one without pausing jobs.

Confidentiality comes from controlling who sees details and when. Use NDAs, share information in stages, and avoid emailing sensitive files around. Rejigg is built for this. Buyers are pre-vetted, they sign NDAs digitally before seeing sensitive information, and you can control data room access by buyer and by folder. That lets you run a real process without broadcasting the sale to your market.

Most buyers ask for a non-compete and non-solicit so the seller doesn’t open a new plumbing shop nearby or pull customers and technicians away. The exact terms vary by state, and enforcement varies too, so this is an attorney question in your local market. In plain English, the buyer is paying for your phone number reputation, customer relationships, and team stability. They want time to transition ownership without you re-entering the market.

Buyers value memberships when they are active, renewing, and supported operationally. They will look at churn, what’s included, billing method, and whether you can schedule the promised work without blowing up your calendar. If memberships are mostly discounts that create angry customers in peak season, they may not add much value. Bring a report showing active members, renewals, and revenue tied to members so it’s grounded in actual behavior.

Most buyers want the seller involved for a defined period to transfer relationships, steady the team, and cover licensing or permit continuity when needed. In plumbing, that often means introductions to commercial contacts, a planned handoff for escalations and refunds, and mentoring the person who will own qualifier responsibilities. The cleanest transitions are role-based with a calendar and deliverables. Rejigg’s transition planning guide helps you structure it.

In plumbing, LOIs often get tense around working capital targets, holdbacks tied to warranty risk, how commercial receivables are handled, and what happens if licensing takes longer than expected. You also want a clear list of what’s included with the fleet and specialty equipment. Look at the whole package, not just the headline price. Rejigg’s deal tracking and offer comparison helps you see terms side-by-side. Learn the basics here: negotiate a deal.

There’s no single perfect month, but timing changes how your numbers look and how much bandwidth your team has for diligence. Many owners aim to sell after a strong stretch so the last 12 months of earnings look solid, and before a period where on-call fatigue and weather-driven spikes make operations choppy. If you have a meaningful membership base, show renewal and scheduling patterns across the year so buyers don’t mistake seasonality for decline.