How to Value an HVAC Business: Multiples and Add Backs

Most HVAC companies are valued on a multiple of earnings. For smaller, owner-operated shops that’s usually seller’s discretionary earnings (SDE). For larger ones it’s adjusted EBITDA. The multiple depends on size, how much revenue repeats, how much the business depends on you, and whether a buyer can verify your numbers.

Owners tend to focus on the multiple. Buyers focus on the earnings underneath it. They’re grading four things: can they verify the EBITDA, can they trust the reporting, is there recurring revenue, and will the company keep running without the owner. Those are the same four things a broker looks at before deciding whether to list you.

Here’s why the multiple and the earnings both matter:

• $500K of EBITDA at 5x = $2.5M of enterprise value
• $500K of EBITDA at 8x = $4.0M of enterprise value
• $1.0M of EBITDA at 5x = $5.0M of enterprise value
• $1.0M of EBITDA at 8x = $8.0M of enterprise value

Same type of business, very different outcomes. (These multiples are for illustration. Published averages by size are in the table further down.)

I’ve spent enough time inside contractor books to say this plainly. Buyers pay for what the books can prove. The ten value drivers below all push on the same four things: verified EBITDA, operational independence, recurring revenue, and data integrity.

How much is my HVAC business worth?

Start with three numbers: your trailing twelve months of earnings, the add backs you can document, and a realistic multiple for your size.

If you’re under roughly $2M to $3M in revenue, use SDE. That’s net income plus your salary, benefits, interest, depreciation and one-time costs. Above that, use adjusted EBITDA, and assume a buyer will have to pay someone a market wage to do your job.

Then apply a range, not a single multiple. In the example below, a company with $760,000 of adjusted EBITDA is worth about $3.8M at 5x and about $5.3M at 7x. Where you land in that range comes down to what’s in the rest of this article.

If you want a quick estimate, the free calculators from ServiceTitan and Housecall Pro will give you a number. They don’t test whether your add backs will hold up or whether your labor is coded correctly. That’s where most of the gap between the asking price and the sale price comes from.

How to value a heating and air conditioning business

Start with earnings, not revenue. Two companies can both do $6M and be worth very different amounts, and the top line won’t tell you which is which.

The method is not complicated. Take the trailing twelve months of earnings, normalize them so they reflect what the business actually produces, then apply a multiple. Everything hard about valuation lives in those two middle steps.

SDE or EBITDA: which number buyers use

Which earnings number depends on your size. Below roughly $2M to $3M in revenue, buyers usually work from SDE, which treats your pay as a benefit of ownership rather than a cost. Above that they move to EBITDA and assume they’ll have to pay somebody a market wage to do what you do.

Which EBITDA add backs survive

Normalizing is where the argument happens. EBITDA add backs are the adjustments that put back expenses the business won’t carry under new ownership. Above-market owner compensation. A personal vehicle. Family on payroll who don’t work there. A one-time legal settlement.

The test a buyer applies is simple. Every add back has to be documented, non-recurring, and unrelated to running the business. One you can’t support doesn’t get discounted, it gets removed. And a long list signals the books were kept for tax rather than for operating, which costs you on the multiple even where each item is legitimate.

If you run an S corp, this can go the other way

Plenty of owners take a modest W-2 salary, say $80,000 in a $3 million to $10 million shop, and pull the rest out in distributions. That can make sense for how you’re taxed. It also means there’s nothing to add back, because distributions never hit the P&L as an expense in the first place.

And if that $80,000 salary sits below what a buyer would have to pay a general manager, the adjustment runs against you. They subtract the difference, because somebody has to be paid to do the job you were doing for less. A low owner salary doesn’t make the business more profitable. It just moves where the cost shows up. I cover how to set that number in what HVAC owners pay themselves.

What that looks like on one set of books

A $6M HVAC company reporting $420,000 in net income:

At 5x that business is worth about $3.8M. At 7x it’s about $5.3M. Same company, same year, same adjusted earnings, and a $1.5M difference.

The same arithmetic applies to plumbing, electrical and roofing. HVAC comes up most often because maintenance agreements and equipment mix give a buyer more to grade.

That gap is what this article is about. The multiple isn’t negotiated at the closing table. It’s decided long before that by whether your books close monthly, whether margins are visible by department, whether the agreement base holds up, and whether the business runs when you’re not in it.

HVAC business valuation multiples by size

Published multiples are averages from deals that closed. Use them as a starting point, not a price.

First Page Sage’s 2025 report on private HVAC sales (Q3 2022 to Q1 2025) shows residential all-purpose HVAC companies at:

Source: First Page Sage, HVAC EBITDA & Valuation Multiples – 2025 Report, February 2025. Commercial companies come in lower than residential in every size band in the same report.

Two things to keep in mind. These are averages of companies that sold. The same report says about 52% of HVAC companies that go to market don’t sell, mostly because of owner dependence and customer attrition. And size moves the multiple as much as anything, so a company with $700K of EBITDA shouldn’t expect the multiple of one with $7M.

Roofing usually trades lower than HVAC because the work is more cyclical and less of it repeats. Plumbing and electrical are valued the same way as HVAC, and recurring revenue, management depth and documentation matter more than the trade.

Run the numbers on your own business

You don’t need a calculator for a first pass. Pull last year’s P&L and do this:

1. Start with net income.
2. Add back interest, depreciation and amortization. That’s EBITDA.
3. Add back owner pay above what you’d pay a general manager, plus personal expenses and one-time costs you can document.
4. If your salary is below market for the role, subtract the difference.
5. Multiply the result by a low and a high multiple for your size.

The table above is that process on a $6M company. Most owners find step 3 shorter than they expected, and step 4 is the one they hadn’t thought about.

What lowers the multiple

A few things consistently pull the number down:

• New construction. Buyers see it as tied to the economy, so earnings from new construction get valued lower than service and replacement work.
• Owner dependence. If you sell the replacement jobs, approve the pricing and hold the key relationships, buyers price in the risk that revenue or margin slips after you leave.
• Books you have to explain. Cash basis, no monthly close, labor in overhead, personal spending. Each one gives the buyer a reason to cut EBITDA before applying any multiple.
• A thin field team. A one- or two-tech shop can pay the owner well and still be hard to sell.

Who buys HVAC companies, and how that changes the price

Buyers generally fall into three groups:

• Individual buyers, often using SBA financing. They’re usually looking at smaller companies and price off SDE. Licensing is worth raising early with your lender, because who holds the licence after closing can affect how the deal is structured.
• Strategic buyers, meaning another HVAC, plumbing or electrical company expanding into your market.
• Private equity, which buys a majority stake, often has you keep a share, and plans to sell again in a few years.

Each one looks at your numbers differently, and the right advisor depends on which group fits your size. I cover that in how to pick an HVAC business broker.

10 things that move your HVAC valuation

1. Get the books on accrual and close them every month

Cash basis books are fine for surviving. They’re weak for selling.

Buyers price deals off accrual earnings because accrual shows what happened in the business, not just what cleared the bank. If your reporting only makes sense after a long explanation from you, the buyer’s diligence team will rebuild it anyway, and you probably won’t like their version as much as yours.

A consistent close matters just as much as the accounting basis. A business that can hand over clean monthly financials for the last two years looks managed. A business that produces numbers when the tax return is due looks owner-dependent, even if revenue is solid.

Use QuickBooks Online if that’s your accounting hub, and run the close on a fixed schedule. Most of the finance stack has moved to the cloud, which makes integration with field systems easier and diligence less painful.

A practical monthly close usually includes:

• Bank and card reconciliations: Match every operating account before issuing financials.
• AR and AP review: Make sure invoices, vendor bills and aging reports reflect reality.
• Payroll liabilities: Tie payroll tax and benefit balances back to source records.
• Balance sheet cleanup: Don’t let old deposits, suspense entries or stale assets sit there for months.

If you can’t close monthly, you can’t defend EBITDA.

If the historical cleanup is ugly, don’t let that stop you. Start running accrual correctly going forward, then build the habit. This cash flow forecasting template for contractors helps connect your month-end numbers to actual cash decisions.

2. Put labor in the right place and learn your margins by department

Misclassified labor can make a weak contractor look healthy.

Buyers test that fast. They don’t spend much time debating your valuation formula if the gross margin is built on labor sitting in the wrong place. They start with a simpler question: does reported EBITDA still hold up after direct labor, payroll taxes, benefits, callbacks and field support are assigned where they belong?

If the answer is no, the multiple usually drops before the conversation gets very far.

A buyer-grade P&L shows how each department earns money. For an HVAC company that usually means service, maintenance agreements, install or replacement, and project work if you do it. If install is covering weak service pricing, or maintenance is producing leads but little margin of its own, a departmental view shows it.

Each department carries a different risk. Service revenue tends to be steadier. Replacement can be very profitable, but only if labor efficiency, discounting and callbacks are controlled. Project work can add revenue while dragging cash and management attention. A blended company-wide margin hides those differences, and a buyer reads that as less visibility, not more strength.

The fix is operational:

• Put technician wages tied to revenue work into cost of goods sold.
• Load payroll taxes, benefits, commissions and other labor burden with that labor.
• Separate service dispatch labor from install coordination if they support different revenue streams.
• Review gross profit by department every week, especially install and replacement.
• Tie field hours back to accounting so your field system and general ledger tell the same story.

Here’s the arithmetic buyers care about. If service revenue is $400,000 and direct labor plus burden is really $180,000, gross profit is $220,000, or 55%. If you left $40,000 of that labor in overhead, gross profit appears to be $260,000, or 65%. That doesn’t just overstate one margin line. It distorts pricing decisions, hides underperformance, and inflates EBITDA until diligence moves the cost back.

I’ve seen owners learn more from a 90-day departmental margin review than from a year of top-line reporting. One department can look busy, keep trucks moving, and still produce weak gross profit because labor mix, overtime and discounting are off. Once that shows up by department, the next move is usually clear: raise price, change staffing, or stop doing low-margin work. For the reporting structure, see HVAC accounting systems and reporting. If you’re on ServiceTitan, getting accurate job costing out of ServiceTitan covers the setup.

3. Stop running personal spending through the business

Yes, add backs exist. No, that doesn’t make messy spending harmless.

Every personal expense you run through the company creates one more argument in diligence. The buyer’s side asks whether it’s non-operating, whether it goes away after closing, and whether you’ve treated similar costs consistently. If the answer gets fuzzy, they cut it.

This is why clean books beat explained books. Buyers aren’t naive. They’re skeptical for a living.

Family phone plans, personal auto use, travel that mixes business and family, and payroll for loosely defined family roles all make a buyer work harder to trust the number. The damage isn’t just the expense itself. It’s the signal that the books may need to be rebuilt.

Buyers don’t pay more for your explanations. They pay more when there are fewer reasons to question the EBITDA.

Go line by line through bank feeds, credit cards and payroll. Remove the personal items early, not right before a sale. When the cleanup shows up over time, the business reads as a company rather than a personal operating account.

4. Raise your prices

Underpricing can cost you more value than a weak multiple.

Buyers test pricing by asking whether your margins are real, repeatable and visible in the records, or propped up by owner effort and underbilled work. If the pricebook is stale, EBITDA looks weaker, service gross margin is harder to trust, and every department is harder to diligence.

Buyers don’t pay more just because rates went up. They pay more when higher pricing shows up as verified gross profit, clean close-rate data and steady demand.

A practical example. If your diagnostic or dispatch fee has been $49 for two years while wages, fuel and callback risk have climbed, that fee is probably subsidizing every service call. Raising it to $79 or $89 does two things a buyer cares about. It improves contribution margin up front, and it shows your team can hold rate in the field without losing bookings. The same logic applies inside the pricebook. If a capacitor replacement has been sitting at $210 and your fully loaded labor plus materials now support $285, leaving the old number in place doesn’t make you competitive. It makes your EBITDA less transferable. More on this in how to price HVAC jobs.

How you roll out the increase matters as much as the increase:

• Review the pricebook after labor, material or vendor changes, not once a year out of habit.
• Separate standard, after-hours and emergency pricing so fast-response capacity shows up in margin.
• Track sold hours, average ticket and close rate by call type after changes.
• Require discount codes or manager approval so margin erosion is visible.

I’ve seen owners raise prices, then give the increase back through untracked discounts and inconsistent quoting. Buyers catch that quickly. They compare invoice detail, booking patterns, tech performance and gross margin by department. If pricing discipline holds, EBITDA quality improves with it. If it’s sloppy, a higher rate sheet doesn’t help the multiple.

5. Get overhead back to a healthy percentage

Buyers will forgive lean infrastructure. They won’t forgive overhead that hides weak controls, low manager accountability or bad data.

High overhead isn’t just a margin problem. It’s a diligence problem. If SG&A keeps rising but service capacity, close rates and department margins don’t improve with it, a buyer starts asking how much of EBITDA is real and how much disappears after cleanup.

A simple test works well. Pull three years of overhead by month and line item. Sort each expense into one of three buckets: revenue support, control and compliance, or clutter. Revenue support includes dispatch, call handling, selling tools, and management roles that clearly improve booking, conversion or technician output. Control and compliance covers accounting, payroll, licensing, insurance and safety. Clutter is everything you kept paying for after the reason for it was gone.

That usually turns up the same trouble spots.

Software is a common one. A company may have field service software, a separate CRM, a marketing dashboard, route optimization, payroll add-ons, financing tools and reporting subscriptions, with overlapping functions and no single source of truth. Buyers notice because duplicate systems create reconciliation problems and make revenue, labor and membership reporting harder to trust.

Facilities are another. A bigger shop, extra warehouse space or a second office can be worth the cost if it supports route density, inventory control or hiring. If it exists because the business grew fast and never reworked the footprint, it reads as fixed cost with no clear return.

Back-office staffing needs the same scrutiny. I’ve seen companies add admins to patch process gaps that should have been fixed with cleaner workflows, better field invoicing or a tighter close. Cutting people blindly isn’t the answer. Buyers want to see that each role is tied to collections, scheduling, reporting accuracy, customer retention or margin.

For benchmarks, see HVAC business profit margins and cost structure. The question to ask of every overhead line is whether it helps the company produce and protect gross profit, or just sits below the line.

Lower overhead raises EBITDA, but the bigger benefit is confidence. Clean overhead tells a buyer the business can grow without adding waste, the reporting is credible, and post-close cost cuts aren’t the only reason the deal works.

6. Make yourself unnecessary

Owner dependence cuts value fast.

A buyer isn’t trying to admire how hard you work. They’re testing whether EBITDA still holds if you stop answering every service question, approving every estimate and fixing every dispatch problem. If too much of the business sits in your head, your earnings look less transferable.

That shows up in diligence quickly. Buyers ask who sells replacement work, who owns the key account relationships, who can approve pricing exceptions, who handles technician issues, and which licenses the company relies on day to day. Weak answers lower confidence in the multiple. Revenue may stay, but margin often slips during the transition if you were the one holding pricing, production standards and collections together.

A practical test: leave for two weeks without staying glued to your phone. Track what needs your approval, what gets delayed and what gets done wrong. That’s your punch list. Josh Kelly makes the same argument from the operating side in why trades businesses stall around $10M: the wall most hit around $8 to $10 million is a middle management problem, not a sales one. I break down the stages in the $3M to $15M scaling breakdown.

The fixes are usually operational:

• Put one person in charge of field operations and give that role clear authority.
• Move customer relationships from your cell phone to the CRM, office and account management process.
• Set written approval limits for discounts, callbacks, purchases and payroll exceptions.
• Make sure someone besides you can read the dashboard, review jobs and explain last month’s results.

Buyers pay more for businesses that can be handed off cleanly. A company can still have a visible owner and be valuable. The difference is whether it runs on management systems or on you stepping in.

7. Build the maintenance agreement base

A large maintenance base does more than smooth revenue. It gives buyers a way to test whether future EBITDA is real and repeatable beyond the last twelve months.

Agreements create scheduled visits, renewal history and a documented pipeline for repairs and replacements. A buyer can review contract counts, renewal rates, average revenue per agreement, completed visits, open obligations and replacement conversion by cohort. That’s far more persuasive than a growth story built on one-time demand.

Buyers consistently pay more for companies with recurring revenue, strong retention and a service base that creates repeat work. Agreement customers are easier to underwrite. A buyer can see the installed base, estimate renewal risk, and tie service activity to later repair and replacement revenue.

That confidence disappears fast if the data is sloppy. Inflated agreement counts, inactive members left in the system, prepaid contracts with unclear deferred revenue, or missing visit history all create diligence work and raise questions about EBITDA.

Manage the agreement base the way a buyer will test it:

• Sell agreements on every eligible call: Make it part of the service process, not a side pitch.
• Track active agreements by month: Watch starts, cancels, renewals and expired plans separately.
• Measure revenue by agreement cohort: Show what first-year members do versus long-tenured members.
• Tie agreements to replacement outcomes: Equipment age, service history and replacement conversion should be easy to pull.
• Record deferred revenue and owed visits clearly: Buyers want to know what cash is earned versus what service still has to be delivered.

One clean roster with credible reporting does more for buyer confidence than a bigger list full of bad records.

The trade-off is short-term margin. Discounted tune-ups, admin time and fulfillment obligations can pressure current profits if pricing is weak. The fix isn’t to stop selling agreements. It’s to price them correctly, track the labor burden, and show that the agreement base produces profitable repair and replacement work over time.

8. Lock in your technicians

A buyer won’t pay a strong multiple for EBITDA that depends on a field team they don’t believe will stay.

Technician retention isn’t an HR side issue. It affects capacity, callbacks, close rates and revenue continuity the day ownership changes. If two companies show similar earnings, the one with a stable bench of licensed techs, lead installers and field supervisors is the safer buy.

The question is simple: can the business keep producing without a reset in the trucks?

A lot of owners answer that with tenure stories and personal loyalty. Buyers want proof: signed employment terms for key people, clean payroll classification, documented pay plans, and a visible pipeline for recruiting and training. If your best technicians stay because of you personally, that’s dependence. If they stay because the company offers clear pay, room to advance and organized management, that’s transferable.

Start with the people who would hurt the business if they left in the first 90 days after close. Usually that’s licensed technicians, top producers, install leads and field managers. For that group, tighten four things before a sale process starts:

• Written agreements for key roles: Compensation, duties, restrictive covenants where enforceable, and what happens at separation.
• Correct worker classification: Misclassified 1099 field labor can turn into a diligence problem fast.
• Pay plans that hold up: Buyers will compare base pay, commission structure, spiffs and overtime against retention risk and margin.
• Targeted stay incentives: For a few people, a retention bonus tied to time and performance through the transition can protect revenue better than a broad raise.

Paying above market or adding retention bonuses can compress EBITDA in the short term. Losing two top technicians during a sale process usually does more damage. Revenue slips, gross margin gets harder to predict, and the buyer adjusts the multiple for execution risk.

A stable field team also makes your numbers more believable: cleaner labor efficiency, fewer emergency subs, better schedule density, and less swing in monthly results.

9. Document processes and standard operating procedures

Buyers don’t pay higher multiples for tribal knowledge. They pay for a company that keeps producing EBITDA when the owner is out of the building.

That’s what SOPs show. In diligence, documented process answers four questions fast. How does work get sold? How does it get scheduled and completed? How do you protect margin when jobs go sideways? Who owns each step if the owner steps back?

A weak process library shows up in specific ways. Dispatchers make exceptions from memory. Techs discount without approval. Install crews close out jobs differently. Payroll, job costing and callbacks stop matching what operations says happened. A buyer sees that and starts questioning whether reported margins are repeatable.

Start with the handoffs that affect cash, labor efficiency and customer experience: call intake, dispatch priority, how techs present options, approval limits on discounts or change orders, install-to-service coordination, collections, callbacks, and month-end support from operations to accounting.

I’d rather see ten procedures people actually use than a hundred-page manual nobody opens.

The format matters less than evidence that it’s used. A practical SOP package usually includes short field checklists, a clear owner for each process, dated revisions, and training records showing new hires were taught the same way. Screen recordings often work better than binders for CSR workflows. Photos and checklists often work better than long write-ups for warehouse, truck stock and jobsite closeout.

One test: if a buyer asks, “What happens when a tech is running late, the customer is upset, and the job needs parts approval?” your team should be able to point to the process, not call you.

Documented process also tightens the numbers. Consistent closeout steps speed up invoicing. Standard approval rules protect average ticket and gross margin. Clear callback procedures make rework visible instead of burying the labor in another job.

Don’t try to document everything at once. Pick the repeatable decisions that still bottleneck around you and build from there.

10. Invest in technology and integrations

Bad system data can cut value faster than outdated software.

Buyers don’t pay more because you use a popular field platform. They pay more when the numbers survive diligence. That means closed jobs in the field system match invoices in accounting, payroll hours tie to jobs, deposits clear correctly, and deferred revenue from maintenance agreements is posted the same way every month.

Technology either shortens diligence or extends it. If a buyer pulls a sample of jobs and finds mismatched statuses, missing labor, or revenue booked before the work was done, confidence drops, and the multiple usually follows.

The practical test: take one completed call or install and trace it through the full chain. Dispatch, technician notes, quoted work, approved invoice, payment, payroll, parts and financial statements. If the trail breaks in the middle, your systems aren’t integrated in a way a buyer can trust.

A few fixes carry the most weight:

• Map the handoffs between field activity and accounting, then remove duplicate entry.
• Reconcile open and closed jobs to invoices every month.
• Tie payroll hours and labor burden back to the right department and job type.
• Review maintenance agreement billing, deferrals and cancellations in one monthly schedule.
• Limit manual journal entries from operations systems unless someone can explain and support them.

More automation saves admin time, but it can also spread bad setup across every invoice and every close. I’d rather see a simpler setup with clean reconciliations than five connected apps nobody fully owns.

ServiceTitan with QuickBooks can work well. So can other combinations. What matters isn’t the brand. It’s whether your systems produce consistent revenue, margin and cash numbers without cleanup every time a lender or buyer asks.

10-point comparison

Build the number buyers can trust

Strip away the noise and HVAC business valuation comes down to how much the buyer trusts your earnings.

Ryan Williams has seen this from the buyer’s side. Why EBITDA disappears after you buy a trade business is worth hearing before you build your own number. And some owners skip the outside buyer entirely. Dillon Caraway on becoming your own private equity covers that side.

Smaller owner-operated companies trade on SDE. Larger ones move to EBITDA. Either way, the question is the same: what earnings can the buyer verify, how transferable are they, and how much risk sits behind them?

I’d split the work into quick wins and longer projects.

Start with the fixes that change diligence fastest. Get the books on accrual. Close monthly on a fixed schedule. Put labor in the right place. Reconcile the field system to accounting. Take personal spending out of the business. None of that guarantees a higher multiple, and nobody can promise one. What it does is protect your EBITDA from getting cut apart in a quality of earnings review.

Then work on the longer-lead items over the next 12 to 24 months. Raise prices with discipline. Trim overhead that doesn’t support production. Grow the maintenance agreement base. Keep key technicians. Make the business less dependent on you. Document how the company runs. These raise earnings and support a better multiple, because the buyer sees a more durable company.

Clean books don’t create value out of nothing. They keep existing value from being deleted. Recurring revenue gives a buyer a future they can underwrite. SOPs reduce key-person risk. Connecting ServiceTitan and QuickBooks matters because conflicting systems make buyers doubt the number.

If you’re planning to sell in the next few years, don’t wait for the broker conversation to start this work. By then the cleanup is rushed. When you’re ready for that step, read how to pick an HVAC business broker and selling an HVAC business.

This is the work I do with clients: QuickBooks Online cleanup, ServiceTitan integration, job costing, weekly gross profit tracking and cash flow. If you want to talk through where your numbers stand, get in touch.

HVAC business valuation FAQ

How much is an HVAC business worth?

Usually a multiple of SDE or adjusted EBITDA. The multiple depends on size, recurring revenue, owner involvement and how well the books hold up in diligence. Two companies with the same revenue can be worth very different amounts.

What is the EBITDA multiple for an HVAC company?

It varies by size and type. First Page Sage’s 2025 report puts residential all-purpose HVAC at 6.3x for $500K–$1M of EBITDA and 9.2x for $1M–$5M. Treat that as a reference point, not a price for your company.

Is SDE or EBITDA used to value an HVAC business?

Smaller owner-operated companies are usually valued on SDE, which includes the owner’s pay. Larger ones are valued on EBITDA, after paying a market wage for management.

Are HVAC business valuation calculators accurate?

They’re useful for a rough range. They don’t check whether your add backs are documented, whether labor is coded correctly, or whether the business runs without you. That’s where most of the difference comes from.

What increases the value of an HVAC business the most?

Clean accrual books, verified EBITDA, recurring revenue from maintenance agreements, strong department margins, low owner dependence and a stable technician team.

What hurts an HVAC business valuation?

Messy financials, personal expenses in the business, labor coded to the wrong place, stale pricing, little process documentation, and too much reliance on the owner for day-to-day decisions.

Does a plumbing, electrical or roofing business get valued the same way?

Yes, the method is the same. Roofing tends to trade lower because more of the work is one-time and cyclical.

Should I switch from cash basis to accrual before selling?

In most cases, yes. Buyers and lenders want accrual reporting because it shows true earnings, liabilities and monthly performance.

How long does it take to sell an HVAC business?

Joe Bergin of Commonwealth M&A describes the active sale as an incremental full-time job over roughly six to nine months. Getting the books ready takes longer than that, which is why I’d start 12 to 24 months before you plan to sell.

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