Electrical Valuation Template

The Revenue Quality Analysis sheet requires honest categorization of how your revenue was generated, not just what category it falls into. Go through your trailing twelve-month job list and sort each revenue source into the four buckets: recurring commercial maintenance with signed agreements, residential service relationships from repeat customers who call you specifically, project work won through competitive bidding, and new construction work that depends on GC relationships. If you have commercial maintenance agreements, document them in detail — copies of agreements, annual billing amounts, renewal terms, and which staff the commercial client interacts with — because this documentation directly increases the defensible value of that revenue category. Calculate your customer concentration percentages honestly: if a single commercial client, property management group, or GC represents more than 15% of your trailing revenue, flag it in the sheet and prepare to explain the relationship's continuity and contractual basis. Document your backlog by category — signed commercial contracts not started, residential work accepted and scheduled, and the renewal value of maintenance agreements for the next twelve months.

Beyond the license question, the specific variables that drive electrical contractor multiples up or down are well understood by industry brokers and experienced buyers. Revenue quality is the primary lever: commercial maintenance agreements and service contracts with documented renewal terms command a premium over project-bid revenue because they provide a buyer with a visible, recurring income stream that doesn't require winning new bids. Owner dependency in estimating and key client relationships is the second major factor — if the owner is the primary estimator, the person who builds relationships with commercial facility managers and property management contacts, and the face of the business for the top accounts, a buyer is acquiring revenue that may be partially relationship-dependent on the seller rather than on the business itself. Customer and GC concentration is a third factor buyers consistently act on: a single commercial client or general contractor representing more than 15–20% of revenue is flagged as concentration risk, and buyers either require seller-employment periods, earnouts tied to account retention, or a direct price reduction to account for the revenue that might not transfer. The journeyman-to-apprentice ratio indicates scalability — a business with several journeymen capable of running their own jobs and training apprentices beneath them is operationally more scalable than one where all meaningful work flows through the owner or a single lead journeyman.