A towing business asked $500K, based on $180K of “cash flow.” But: ❌ Owner drove most shifts + handled dispatch❌ $30K in addbacks = gas, “personal use” truck, and non-itemized fuel cards❌ 78% of revenue from one police contract❌ No CapEx for trucks over 10 years old 📉 Real FCF: ~$34K📦 Revised value: ~$225K 📌 … Continue reading ⚠️ Red Flag Case Study: The $500K Breakdown

🚛 Towing companies often show strong revenue—but beware of hidden risks under the hood. Valuation watchpoints: Owner often drives and dispatches Revenue may be concentrated in one contract (e.g., police rotation) CapEx for trucks is often ignored Addbacks tied to fuel, vehicle depreciation, or cash collection 📌 Rule of thumb: If the truck fleet is … Continue reading 🧠 Valuation Insight: Trucks Break Down. So Can the Deal.

📄 New for SBA 7(a) lenders: Our Copy Shop & Service Center Valuation Checklist Includes: ✅ Owner labor vs. market replacement✅ Franchise royalty + fee structure normalization✅ Addback traps: vehicles, perks, vague “marketing”✅ Red flags: no lease transfer, staff turnover, or outdated equipment 📩 Click here to grab your copy.

A branded service center (franchise) asked $650K based on $125K in cash flow. But: ❌ Owner worked 50+ hours/week at the front desk❌ $22K addback = “owner vehicle” and “marketing”❌ Franchise + royalty fees not properly adjusted❌ No staff retention plan in place 📉 Normalized FCF = ~$38K📦 Revised valuation = ~$225K 📌 Overprinting SDE … Continue reading ⚠️ Red Flag Case Study: The $650K Overprint

📦 Copy shops and service centers (like UPS Stores) often look stable—but dig deeper. Common valuation issues: Owner often works the counter full-time Addbacks include personal vehicle or labor Heavy franchise fees and marketing contributions Limited pricing control due to brand/franchise rules 📌 Rule of thumb: Royalty doesn’t mean loyalty. If margins are tight and … Continue reading 🧠 Valuation Insight: Copy Shops / Business Service Centers / UPS Stores – Franchise Fees ≠ Free Cash Flow

📐 Ready to simplify engineering firm valuations? Grab our new checklist for SBA lenders. Covers: ✅ License transfer + staff dependency✅ Addback traps: vehicles, meals, and unbilled time✅ Revenue concentration + contract renewal risks✅ Red flags: no junior staff, long A/R cycles, no CRM 📩 Click here to grab your copy.

An engineering firm asked $1.1M on $285K of SDE. But: ❌ Seller was sole licensed engineer + client liaison❌ No staff, no succession, no junior PE❌ 58% of revenue from municipal contract renewed yearly❌ Addbacks included personal vehicle + vague ‘biz dev’ travel 📉 Normalized FCF: ~$105K📐 Real value closer to ~$760K 📌 Licensing, staffing, … Continue reading ⚠️ Red Flag Case Study: The $1.1M Pipe Dream

📐 Engineering firms can post healthy margins—but the expertise is often tied to one person. Valuation challenges: Owner is the licensed PE or lead on billable hours No junior staff or succession plan Project-based income with long billing cycles Revenue tied to personal relationships or referrals 📌 Rule of thumb: No license, no leverage. Without … Continue reading 🧠 Valuation Insight: Engineering Consulting Firms- When the Expertise Leaves, Does the Value?

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A restoration company asked $950K, citing $290K in cash flow. But: ❌ 41% of revenue from one hurricane season❌ Owner wrote all estimates & ran crews❌ $45K in addbacks = truck depreciation + uncle’s “bonus”❌ No contracts—just insurance referrals 📉 Normalized FCF = ~$88K💧 Revised value: ~$600K 📌 One big storm can’t justify a big … Continue reading ⚠️ Red Flag Case Study: The $950K Washout