So it's state by state in South Carolina. I'm a licensed flooring contractor, but for the Job size in North Carolina. And again, it's typically around job sizing that states require licensing.
Acquiring Minds
Buying a Platform with an SBA Loan
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In North Carolina you don't need a license. That's correct. So the scalability with B2B, the revenue diversification through commercial, multifamily or retail, the cash conversion cycle that retail operations can provide and yeah, the lack of capex that you would see in other construction industries all. And let me add a couple more.
Yeah, the fragmentation and the multiples all create a, a great environment for aggregators in the space. And we actually see that some of ADG is primarily a construction subcontractor that sold to Lowe's earlier in the year for over a billion dollars. And we see other firms that are aggregating, either mostly builder or mostly retail flooring contractors.
So it is happening in the space, but with the added benefit of lower multiples for all the reasons people don't like it.
And so is this a case of private equities? Definitely coming. It's already here in a little bit, but it's early innings and more will come. And by the way, every, you know, all my, all my guests say my industry is the next one. Exactly, exactly.
So on the high end, the best multiple you can sell these businesses for, north of 100 million in revenue is low double digits. That is typically not going to be interesting to a mega fund. But that being said, there are family offices that are aggregating and again, we've seen transactions at the high end of the market which confirms the thesis that there is opportunity to buy multiple of these.
I don't think that the market's too small, frankly for there to be a number of private equity players that would eventually drive up multiples. That being said, there is light activity. But back to my issue of finding stores that are big enough.
The market's too small at the mini scale level to really support the activity that you would want to see.
Too small. I don't think of flooring as small. I mean, not everything is smaller than H Vac and plumbing, but they're the exception, not the rule. So maybe put them aside.
But you know, it's got to be bigger than garage doors, for example, where you're seeing activity. I mean, I just feel like there's a flooring store or multiple in every single market across the land sort of thing. And you know, everybody's got floors.
Right. So to do market sizing, there's 10, 500 flooring retailers.
Yeah.
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