What should I check before buying a grease trap cleaning business?
Check whether restaurant service agreements transfer, how dense the routes are, how many accounts the owner holds personally, the condition of the vacuum trucks and tanks, where the collected waste goes and on what terms, and who drives. Leave permits and licences to your lawyer and the regulator.
A grease trap pumping business looks simple: trucks visit kitchens on a schedule and haul away what the traps collect. Check the routes, the paperwork and the disposal arrangements behind them. A buyer should ask for the records that show how the business runs, and should expect some answers to take time.
Service agreements and the accounts
Ask for every customer agreement and the pickup schedule behind it. Find out which agreements are written, which run on habit, and whether each can be assigned to a buyer or needs the customer’s consent. Look at concentration: a few large restaurant groups carry a different risk from many small independents. Ask how long the typical account has stayed, and why any left.
Trucks, tanks and the route
Vacuum trucks and tanks are the heart of the equipment list. Ask for maintenance records, inspection history and any past breakdowns, and have a mechanic who knows heavy trucks look at them. Check route density too. Tight routes mean less driving between stops, while scattered stops cost more time. A ride-along with a driver will teach you more than a spreadsheet.
Where the waste goes
Ask where collected waste is taken, who accepts it, and on what terms. A disposal arrangement that depends on one facility or one personal relationship deserves a closer look. Whether the business holds the permissions it needs, and whether they carry over to a buyer, is a question for your lawyer and the regulator, not something to assume. The environmental checks answer is a useful companion.
People and the owner
Ask who drives, who answers the phone and who knows the customers. If the owner is also a driver and the main contact, plan how that gap will be filled. Ask to meet key staff with the seller’s permission, and ask what each would need to stay. For a similar trade, see what to check before buying a kitchen hood cleaning business.
Related reading
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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 CanadaGovernmentEquipment valuation: How to do it
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