Business For Sale:
Professional Sales and Fulfillment Company Representing Solar and other Energy/Money-Saving Products
Mostly a Residential Solar Sales Company Also Offering Solar Powered Attic Fans, Nest Products including Thermostats, and Insulation Sales and Installation with No Money Up Front Financing with Monthly Payments to be Less than their Current Electric/Gas bill.
This company is well established with a great reputation including a 4.8 stars Google Rating with 96 reviews and has an A+ BBB rating which is very valuable to a new owner who wants to grow this company. This is very valuable to a new owner = the heavy lifting is done to position this company for future growth. See links above for both Facebook and Google reviews.
They specialize in solar sales with financing and with the price including 3rd party installation which they set up and monitor until the job is completed. All projects result in the homeowner saving thousands by switching to solar, upgrading insulation, adding a solar-powered attic fan, and other energy-efficient products resulting in a payment that is less than the electric utility payment that the solar replaces. Solar is in demand, has tax credits (big benefit) for Customers, and will increase the value of their home. More government incentives might be coming soon also.
They are a Solar & Energy efficiency dealership which means they are responsible for the lead generation, follow up, setting appointments, running and selling appointments, customer service, and the main point of contact to the end of the project. They sell solar panels and also offer many energy-efficient products, which pay for themselves over time, products like insulation, Nest Thermostats, and solar-powered Attic Fans. Because Colorado has over 300 days of sunshine Solar is a no-brainer purchase all year long. They provide a program whereas they waive and cover all of the upfront costs for permitting and installation of the solar, insulation, and attic fan project. The program is zero(0) down for a homeowner, which allows them to pay the same or less than what they are currently paying with their utility company for energy, on top of making the home more comfortable and efficient with the upgrades. In return the homeowner is asked to provide an honest testimonial of their experience, a yard sign out front of their house, and provide referrals of homeowners they know in the area.
The new owner could add any number of energy-efficient products like solar-tube lighting which would increase their year-round work. There is an opportunity to provide roofing, windows, siding, doors, and home security automation services to their existing client base. This business would be easy to expand throughout the front range of Colorado with their reputation, website, and popular energy-efficient model and sales model.
Here is a very important consideration for how you value this business which is discussed in detail in the video interview in the data room of the sales package that will be sent to after submitting the NDA in the blue link above. One of the owners states: “On March 15th, 2020, the company was forced to shut down with the lockdowns going on in Denver, CO. In the early stages of the pandemic, 2 of our experienced Project Managers both had life circumstances come up that forced them to leave. The onboarding time frame for a new Project Manager is about 45 days on average. The PM must learn a foundation of our processes in sales, mindset, culture, and two different software programs. On May 7th, we reopened. After interviewing and hiring the last few months, we now have a new solid & motivated core of 6 sales reps. We have solid automated processes for hiring and interviews. We are excited to be back on track for more growth and increasing the size of our team from our core culture. Bottom line is that our model is based on 1099 salespeople who are paid when they make sales and when we were shut down, they had no pay checks coming in and had to leave. When were being impacted and eventually had to shut down for COVID, we still had worked on the books from previous sales so the month of March was normal but we were closed in April and literally had zero installations and zero in sales. May was a partial month and well below average and June was normal and July was below normal and should have been better than it was but the months of August and September were severely impacted because we have just completed training our new 6 person sales team in late September. We expect normal winter level sales of 4 to 7 solar packages a month until February of 2021 when sales should pick up again. The COVID impacted spring and summer peak months averaged only 3 ½ deals a month which would have been 11 or more without COVID.” This caused a huge difference in earnings and ultimately the sales price. Because they have no way of knowing exactly what would have happened without the COVID shutdown and loss of their sales force, they can’t say for sure what the impact was but they feel it was between 75K and 150K in lost earnings which would have increased their sales price by an extra 125K to 250K. It is the broker’s opinion that this business deserves an add-back of a minimum of 75K making the business worth closer to 1.1M than the current asking price of 975K.
The perfect time to buy this company is January because it will give the new owner time to learn the business, add products, and plan for 2021 before the peak season.
Location: The business is located in Denver, CO with a gross year-to-year annual renewal lease for 3,200 per month with 2,500 square feet of space set up as a modern fun location for meetings, events, including bonding type events with their subs.
Their team is made up of the 2 owners, 1 administrative employee, and 5 subcontractors who are responsible for generating leads and selling projects. The subcontractors are only paid for projects that are sold and receive 200/kw of the system size sold for projects that are from the company provided leads. The sub-contractors receive 400/kw of the system size sold for projects that they are responsible for generating the lead. The average system size is 5.6kw based on the history of our projects sold to date. So on average, the sub makes 1,120 on company-provided leads that are sold and 2,240 on self-generated leads that are sold.
New salespeople are easy to find and train based on their model because of the amount of money they can make for themselves and for the company. They have created and have automated systems & processes in place to book appointments directly to a managers calendar. The hiring systems have been created to vette personalities that would have a high likelihood of success in sales. The onboarding processes are fully automated with training videos and curriculum to take someone brand new at sales and provide them a foundation of skills to work with. Their sales teams are highly motivated by a gamified process that rewards hard work through a clear road map with incentives, rewards, and uncapped commissions. The sales contractors get paid commissions which is the most efficient way for a company to pay salespeople (they make what they are worth and are paid only when the business is paid), they have less than 5 hours of ongoing formal commitments per week to the company in sales meetings, reports, and training. Systems are in place to aid the salespeople in all processes from incoming phone calls, internet leads, outside sales, and to see the work through to a completed job. They earn a profit on the products markup, the financing, and also on the installation. This is a great model to grow much larger very inexpensively and to build equity for the new owner.
Their marketing consists of leveraging door to door sales and online lead generation. They provide tools and techniques for the door to door sales such as (flyers, software, sales pitches, sales techniques, etc). They nurture and contact the leads via text, email, and calls to ensure they are booking appointments at the highest rate possible. They have automated systems set up to generate booked appointments with homeowners that the sub-teams run.
Their Installation and fulfillment is achieved in three parts. Their solar-fulfillment is performed by a company that has over 10 years of experience in the Denver-metro area installing solar projects. They have built an incredible relationship and exclusive pricing by landing a partnership with the best solar installer in Colorado. Their fully dedicated in-house team is familiar with every city’s permitting process which has given them an edge in fulfilling projects faster than any other solar company in Denver. Their insulation fulfillment is completed at the end of the solar project installation once the panels have reached the roof. They have partnered with a small local commercial insulation company that is able to complete the insulation in just 1 day and is paid only after completion. They have also partnered with a sub-contractor who installs the thermostats.
The price of the business has been lowered from 1,175,000 to the new price of 975K and they will now carry 43% of the sales price and one of the owners will stay on for up to a year OR even consider keeping some ownership and work long term, both indications of their confidence in the future of this business. This is priced at only 1.6 times the trailing 12 months earnings which is an unbelievable deal for a business with their growth rate, online rating, expandability, and profit margin. Plus, they now anticipate greater incentives for solar and green products based on a renewable energy president replacing an oil and gas president.
Jeff Chapman Eisnaugle
Company Broker Group, LLC
Business Broker Colorado, LLC