Is a roofing company that depends on storm work riskier to buy?
It can be, because storm work arrives in bursts and depends on weather the company cannot control. Ask how the owner fills the quiet stretches, how much of the work comes through insurance claims, and whether steady customers exist beyond the storms.
Look at the pattern of work over several years. Storm-driven income tends to spike and then fall away, so a single strong year may not say much. Ask the seller to separate repair jobs after severe weather from regular replacements and maintenance. Your accountant can help you read the statements with that split in mind.
Then ask how the company wins storm work. Does it rely on door-knocking, referrals, insurance adjusters or relationships with property managers? Each channel behaves differently. Also ask how the crews are kept busy and paid in slow periods, and how the company handles a sudden rush without cutting corners on quality or safety.
Finally, think about your own cash. A business with uneven income needs a cushion, and a lender will want to understand the swings. Consider whether you could manage a long quiet spell. Some buyers see storm work as a bonus on top of a steady base; others see it as a reason to be careful. Know which you are. Ask what the owner did the last time several quiet months in a row arrived. The real response says more about resilience than any forecast could. Ask for a few customer references from outside the storm channel, since steady neighbourhood clients soften the swings considerably.
Key takeaways
- Separate storm repairs from regular replacements across several years.
- Ask how the company fills the quiet stretches.
- Make sure you hold enough cash to ride out a slow spell.
Related reading
14 pages on the same subject, grouped by topic.
Buying
- Expert answerWhat if a roofing company’s work comes mostly from one builder?
- Expert answerHow do I read a restoration company’s earnings when storm work swings from year to year?
- Expert answerHow do I tell if a janitorial company’s profit depends on the owner’s own work?
- Expert answerHow do I tell if a fitness studio depends on the owner teaching classes?
- Expert answerHow do I tell if a photography business depends on the owner behind the camera?
- Expert answerWhat if the courier company I’m buying depends on one big carrier contract?
- Expert answerWhat if the trucking company I’m buying depends on one dispatcher?
Selling
- Expert answerWhy is a longer earn-out period riskier?
- Expert answerCan I sell my business if it depends entirely on me?
- Expert answerHow do I sell a café that depends on my own barista skills?
- Expert answerHow do I sell a cleaning company that depends on one big client?
- Expert answerHow do I show that my home organizing business does not depend on my personal taste?
- Expert answerHow do I show buyers that storm cleanup is not my only source of tree work?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Business Development Bank of CanadaGovernmentWhat is Cash Flow
Deavo is an advertising and listings platform, not a brokerage, law firm or valuation firm. This page is general information, not legal, tax, accounting or valuation advice, and rules differ by province. Confirm anything you rely on with a qualified professional before you act on it.