Has anyone acquired or seriously looked at cabinet shops?

May 17, 2023

by a searcher from Cornell University in Gilbert, AZ, USA

I see quite a few cabinet shop listings - some quite large - and the multiples have been relatively low. Curious if anyone has acquired or seriously looked at these businesses and what the challenges or opportunities are?

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Reply by a lender
from University of Central Florida in Tampa, FL, USA

I funded a custom cabinet maker/installer for one of my clients. He's doing great, granted, he has been in the industry for 30 years and has direct contacts in his geographical territory. The multiples tend to be lower on these because of the inherent risk of...not selling enough cabinets on a go forward basis. Simply put, a lot of owners in this space have the correct relationships to continue revenue trends. If you go down this path, I'd suggest structuring the deal to keep the seller on board. Should help mitigate the only major concern here.

Reply by a searcher
in Minnesota, USA

Looked one one heavily a few years ago; the age of the equipment and the personnel on staff were huge factors in me passing. I liked the model and the opportunities that could have been leveraged to grow (marketing, B2B parterning) but it was too difficult to mitigate the risk.

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