Sell a Construction Company in Fort Worth, TX

Why Construction Sales Take More Explaining

A shop that sells a service every day is fairly easy for a buyer to read. A construction company is harder, because the revenue comes in projects that start, run for months and finish on their own schedule.

That means last year's profit only tells part of the story. Buyers want to know what is already under contract, how well you price risk and whether the company can win work without its founder.

The Fort Worth area has kept builders busy for years. A buyer will still ask how your results would hold up if that pace cooled.

Job Costing Comes First

The single best thing you can do before a sale is make sure your job cost reports are right. Buyers compare what you bid, what you billed and what each job really cost.

When those numbers line up, a buyer trusts the rest of your financials. When they don't, every figure gets a second look, and the price often slips.

Many construction companies keep books on a percentage of completion basis. A buyer may bring in an accountant for a quality of earnings review to test it, so clean work in progress schedules save time and arguments.

What a Buyer Will Ask to See

• Backlog by job, with contract value, cost to date and expected margin
• Three years of finished jobs, bid margin against final margin
• Retainage receivable and payable
• Bonding history and current capacity
• Equipment list with age, hours and loan balances
• Open claims, warranty items and any liens
• Your top customers and repeat work from each

Bonding and Personal Guarantees

For a bonded contractor, the surety relationship is one of the hardest pieces to move. Most bonding programs lean on the owner's personal indemnity and the company's balance sheet.

A buyer has to replace your guarantee with their own, and the surety has to agree. Bring your bonding agent into the plan early so this does not surface the week before closing.

Relationships That Win Work

In many construction firms, the owner is the reason developers and general contractors keep calling. That is great for business and tough for a sale.

Start handing those relationships to your project managers and estimators now. Have them lead meetings and sign proposals. A buyer pays more for a company where several people bring in work.

No State License, but Plenty of Local Rules

Texas does not issue a statewide general contractor license. Cities handle permits and registration, and trade work like electrical, plumbing and HVAC is licensed on its own.

If your company holds trade licenses through employees, list who holds each one. A buyer will want to know those people are staying.

Who Tends to Buy

Buyers for construction firms are often other contractors who want a new market, a new trade or more crews. Some are larger regional firms moving into Tarrant County.

Key employees sometimes buy too, often with help from a seller note. Each buyer type values backlog and bonding a little differently, which is why a broker brings more than one to the table.

Taxes and Closing

Texas buyers often ask the Comptroller for a Certificate of No Tax Due before closing, because they can be held liable for a seller's unpaid state taxes. Start that request early.

Construction deals also tend to use earnouts or seller notes tied to finishing the backlog. Good exit planning gives you time to shape those terms instead of reacting to them.

Getting Started

Learn what your construction company might be worth with the free valuation form, or call (817) 555-0142. The conversation stays between us.

Run a specialty trade? See how buyers look at an electrical contracting company.