By Kris Moe
Real-World Lessons from the Solar, Roofing, and HVAC Industries
Selling your business is one of the most important financial decisions you’ll ever make. For specialty trade businesses like solar installation companies, roofing contractors, or HVAC firms, the sale process brings its own unique challenges. Whether you’re selling to retire, pivot, or capitalize on the current market conditions, avoiding these five common mistakes can be the difference between a smooth, profitable exit — or a frustrating, drawn-out process.
1. Inadequate Preparation
Case Study: Flooring Contractor with Outdated Systems
After 15 years in business, a flooring company was ready to sell. They had solid cash flow, great customer reviews, and strong demand. But their accounting was a patchwork of spreadsheets and accounting from an outdated system with inconsistencies across years making it hard for the buyers to get a clear picture of their financials
What Went Wrong:
Buyers balked when they saw disorganized financials and zero documentation of workflows. What should have been a $8 million deal fell apart in diligence.
How to Avoid It:
Start preparing 12–24 months in advance. Clean up your books, organize SOPs, and create documentation around sales, field operations, and customer service. I’ll always encourage my business sellers to spend some money and get a sell-side QOE (quality of earnings) or a pre-sale accounting review to find any surprises and fix those before sharing with prospective buyers.
2. Overestimating Business Value
Case Study: HVAC Owner Chasing Unicorn Offers
A solar company owner with $20M in revenue and $1.5M in profit priced the business at $15M based on “industry hype” and stories of huge multiples in private equity deals. Despite some interest, no serious buyer engaged after seeing the financials didn’t justify the price.
What Went Wrong:
The owner ignored comps or my advice on a reasonable valuation and didn’t adjust expectations. The company ended up sitting on the market for over a year and while his business is doing fine, he won’t sell at what the market is willing to pay.
Now there are some ways around this gap and many construction deals will work out with an Earn-Out. An earn-out is a deal structure where part of the purchase price is paid after the sale — but only if the business hits certain financial goals (like revenue or profit) after closing. It helps bridge the gap between what the seller thinks the business is worth and what the buyer is willing to pay upfront.
How to Avoid It:
Get a proper valuation from an experienced M&A advisor or business broker familiar with your niche. Valuation should reflect actual cash flow (often SDE or adjusted EBITDA), current market multiples, and business-specific factors like customer concentration, growth potential, and recurring revenue (e.g., maintenance contracts).
3. Letting Word Get Out Too Soon
Case Study: Roofer’s Sale Goes Public
A regional roofing business in California began quietly marketing to buyers — but word spread when the owner hinted at selling to a supplier. Within weeks, employees began job hunting, and a key foreman left for a competitor. Customers became hesitant about new contracts.
What Went Wrong:
There were no confidentiality agreements in place, and too many people knew the business was for sale. The internal disruption caused revenue to dip and gave the eventual buyer leverage to lower the price.
How to Avoid It:
Keep the sale confidential. Use blind profiles when marketing. Have every potential buyer sign an NDA before disclosing anything. Don’t tell employees, suppliers, or customers until the deal is closed or nearly finalized, unless absolutely necessary.
4. Trying to Sell Without Professional Help
Case Study: DIY Disaster for a Plumbing & HVAC Combo Business
An owner tried selling his $2.5M revenue plumbing company without an advisor. He found a buyer through an email, negotiated the deal himself, and signed a letter of intent with no exclusivity or timeline. Rookie mistake. After months of back-and-forth and no buyer funding, the deal collapsed. He later discovered the buyer had no capital and had walked away from two other similar deals.
What Went Wrong:
The seller didn’t vet the buyer or structure the deal with proper legal or financial guidance. He wasted time and missed other suitors. One buyer syndrome gives the seller no leverage and buyer will quite often wear down the seller with pricing discounts as time goes on. If there is another buyer or two in the picture this usually keeps a deal moving and keeps the buyer from playing games.
How to Avoid It:
Use professionals. An experienced M&A advisor will bring you vetted buyers, structure the deal properly, and negotiate terms to protect your interests. They also know what’s “market” — so you’re not flying blind.
5. Failing to Pre-Qualify Buyers
Case Study: The Unfunded Solar Investor
A solar installation company got an offer from a group claiming to be backed by private equity. The offer looked strong — full asking price with a quick close. But after four months, it became clear the group didn’t have financing lined up. The company had turned away another buyer during this time and saw backlog shrink due to uncertainty.
What Went Wrong:
No one asked for proof of funds or references. The buyer wasn’t properly vetted.
How to Avoid It:
Don’t move forward with any buyer without checking:
- Do they have access to capital?
- Have they closed similar deals?
- Do they understand your business model?
- Do they have experience in your business?
Ask for background information and funding sources early in the conversation.
Final Thoughts
The sale of a business — especially in skilled trades like solar, HVAC, or roofing — can be a life-changing opportunity when done right. But it’s a process that rewards preparation, realism, and the right team around you. Avoid these common mistakes, and you’ll not only get the price your business deserves — you’ll walk away proud of the legacy you built.