What should I check before buying a traffic control company?
Check the roster of flaggers and how many would stay after the sale, then the signs, cones, arrow boards and trucks. Look at who the customers are and whether work comes through standing agreements or one-off jobs, how dispatch runs, and what the insurance and incident history shows.
Crews arrive at dawn, set out cones and signs, and keep a lane safe until the job ends. A buyer should understand who the crews are, what the equipment looks like, and where the steady work comes from. Training and road-authority requirements are for your lawyer to confirm, not for this page to state.
Know the crew before you count the gear
Ask for the roster of flaggers and supervisors, how long each has worked there, and how many are full-time as opposed to called in. Ask who would stay if the owner left. Find out how certifications are tracked and who renews them. A company that depends on a handful of supervisors is a different purchase from one with a deep bench.
Inspect signs, boards and trucks
List the signs, cones, barriers, arrow boards and truck-mounted attenuators, and look at their condition. Ask how they are stored, repaired and replaced, and whether any are leased or financed. Ask for maintenance records on the trucks. Worn or missing gear becomes a cost you would carry as the new owner.
Understand who hires them and how
Ask about the customer mix: utilities, municipalities, paving and pipeline contractors. Find out whether the work comes through master service agreements or one-off jobs, and whether those agreements can be reassigned. Ask how seasonal the calendar is, how on-call and after-hours requests are handled, and how dispatch decides who goes where. Compare this with how you would check an equipment rental business.
Review insurance and incident history
Ask for the insurance policies, the claims history and any incident reports, including near misses and damage to vehicles or gear. Ask what changed afterwards. Your insurance broker can say whether coverage carries over to a new owner, and your accountant can read the books for unpaid amounts the seller has not mentioned.
Related reading
10 pages on the same subject, grouped by topic.
Due diligence
Legal
Buying
- Expert answerWhat if the courier company I’m buying depends on one big carrier contract?
- Expert answerWhat should I check before buying a crane rental company?
- Expert answerWhat happens if I buy a business that is behind on rent or taxes?
- Expert answerCan a licence be transferred to a numbered company instead of me personally?
- Expert answerShould I buy an existing masonry business or start one?
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 CanadaGovernmentMajor pitfalls to avoid when negotiating a purchase agreement
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.