Facilities Maintenance Business Valuations
Independent valuations for multi-trade facilities maintenance providers across Australia.
Green Standard values multi-trade facilities maintenance businesses that look after buildings for property managers, retailers, councils, schools and commercial owners. Two providers with the same revenue can be worth very different amounts, because revenue that passes through to subcontractors and margin that the business earns itself are not the same thing.
A provider with long head contracts, a planned preventive maintenance program, a reliable subcontractor network and a help desk that runs without its founder is a different asset from one that relies on a single national account, wins most of its work through reactive call-outs and carries the cost of slow-paying clients on its own balance sheet.
We examine the contracts, the work mix, the margin on subcontracted trades, the service levels and the working capital, then form a view on the earnings a new owner could reasonably expect to keep.
How much is a facilities maintenance business worth?
A facilities maintenance business is worth the margin it earns on managing building work, not the revenue that passes through to subcontractors, and it is usually valued as its working capital and tangible assets plus goodwill. Goodwill depends on whether the head contracts, systems and key relationships would continue under a new owner. The worked example below shows the steps with illustrative figures.
Facilities Maintenance businesses we value
What affects the value of a facilities maintenance business?
These are the questions we work through when we value a facilities maintenance business. The business often owns few trade assets itself, so value rests on its contracts, its systems and the margin it earns on work done by others.
Contracts and customers
Head contract terms and rebid risk
Head contracts with property managers, retailers, councils and schools usually run for a fixed term and are retendered. We read the term remaining, extension options, termination for convenience rights and any change of control clause, and look at how the business has fared in earlier rebids.
KPIs and abatement regimes
Many contracts set response and completion targets and let the customer reduce payment or apply penalties when they are missed. We look at the performance history, the abatements actually applied, and whether current margins allow for the penalties a buyer might expect.
Concentration on national accounts
Where one national retailer or property group provides a large share of work, a change in their procurement, a store closure program or a panel review can move earnings sharply. We measure concentration by account and by site over several years, and how much of it sits under contract rather than on informal work orders.
Planned preventive and reactive mix
Planned preventive maintenance repeats on a schedule and is easier to forecast, while reactive work follows breakdowns and weather and often earns a different margin. We separate the two where the records allow, because a buyer will price each stream differently.
Quoted works and projects
Minor works, refurbishments and make-good jobs above the maintenance base are lumpier and often competitively quoted. We look at how much revenue they represent, how they are won, and whether they recur or came from a one-off program.
Subcontractors and service delivery
Subcontractor network
Many multi-trade providers deliver much of the work through plumbers, electricians, refrigeration technicians, locksmiths and other trades they do not employ. We look at how long each relationship has run, whether subcontractors are on written terms, and how much of the network the owner holds in their head rather than in a system.
Margin on subcontracted trades
The provider usually earns a margin on top of what it pays the subcontractor, and that margin depends on the rates agreed in the head contract. We calculate margin by trade and by client, and test whether subcontractors would keep working at the same rates for a new owner.
Service levels and after-hours capability
Contracts set response times for emergencies and priority faults, and meeting them takes a staffed help desk, an on-call roster and subcontractors who answer at night. We check how after-hours cover is provided, what it costs and who carries it.
Subcontractor compliance
The licences, insurances, inductions and safety records of subcontractors are the provider’s responsibility to the customer. We look at how they are checked and recorded, since a lapse can put a contract at risk.
Directly employed technicians
Some providers employ their own technicians for core trades or planned maintenance rounds. We look at licences, tenure and utilisation, and whether employed labour earns more or less margin than the subcontracted equivalent.
Systems, cash and the owner
Work order and CAFM systems
A work order or computer aided facility management platform holds the asset registers, job history, response times and invoicing that show how the business performs. Good systems make it easier to run without its founder and give a valuer evidence that is otherwise hard to get.
Client portals and reporting
Large customers often require quoting, work orders and invoicing through their own portals, with set rules for each. We look at how much administration this takes and whether the business can meet it without the owner.
Working capital
The provider pays subcontractors and suppliers while large clients may pay on extended terms, so growth ties up cash. We look at debtor and creditor days, unbilled work and any funding in place, because a buyer must fund that working capital as well.
Gross or net revenue presentation
Whether subcontractor costs sit in cost of sales or are netted off revenue changes the revenue figure and the margin percentage without changing profit. We restate on a consistent basis so that businesses and years can be compared.
Reliance on the owner for key relationships
In many providers the owner holds the relationships with the property group, the national account manager and the best subcontractors. We ask who else knows them, and whether the help desk and account managers could carry the work for a quarter without the owner.
How a buyer reads a facilities maintenance business
Buyers of facilities maintenance businesses include larger facilities services groups adding a region or a client sector, trade businesses adding multi-trade capability, and managers buying into ownership. They want to know how much of the margin comes from contracts and systems that will stay, and how much from the owner’s relationships.
Providers with a spread of clients, planned maintenance revenue, documented subcontractor terms and strong systems tend to attract the widest interest. A business that depends on one national account, carries heavy abatements or relies on its founder to hold the key relationships is usually priced more cautiously, even when its recent profit is strong.
Because a provider typically owns little more than vehicles, systems and its client contracts, value rests on whether those contracts and the people who run them will continue. A valuation works through the same questions, independently and with the reasoning written down.
Adjustments we often make in facilities maintenance businesses
Reported profit is restated to what the business earns on a commercial footing before any method is applied. Every adjustment is listed in the report.
Owner wages
Replacing drawings, or a salary set for tax reasons, with a market cost for the account management, quoting and oversight the owner actually does.
Related-party subcontractors
Work passed to a trade business owned by the owner or their family at rates above or below those an arm’s length subcontractor would charge.
One-off projects and programs
A store works rollout for a retailer, a school holiday program or a single large refurbishment that would not recur at the same level.
Storm and event work
Make-safe and repair work after a major storm or flood that lifted one year’s revenue above a normal level.
Abatements and disputes
Unusual KPI abatements, or the settlement of a dispute with a client, separated from the normal cost of delivering the contract.
Client insolvency and bad debts
Losses from a client or retailer entering administration, treated separately from ordinary credit losses.
Revenue presentation
Restating gross and net presentation of subcontractor costs so that revenue and margin are comparable across years.
Supplier and merchant rebates
Rebates on materials and parts that may not continue, or may not be available to a new owner on the same terms.
Information we typically review
You upload documents through the secure client portal after the engagement is confirmed. We send a list specific to your business; nothing needs to be gathered before the intake.
The financial pack
- Profit and loss statements, usually the last three years and the current year to date
- Balance sheets for the same periods
- Tax returns where relevant
- Payroll summary and employee information
- Vehicle, plant and equipment schedules
- Major customer information
- Recurring contracts and service agreements
- Revenue breakdown by service line
- Owner remuneration and drawings
- Unusual or non-recurring income and expenses
For a facilities maintenance business, also
- Head contracts, schedules of rates and panel agreements, with term, extension options and termination clauses
- Revenue and gross margin by client and by work type: planned maintenance, reactive and quoted works
- Revenue by national account, region and site for the last three years
- KPI and service level reports for the last two years, with any abatements, penalties or notices
- Subcontractor list with annual spend by trade, margin by trade and written terms
- Subcontractor compliance records: licences, insurances and inductions
- Work order or CAFM system extracts: job volumes, response times, first-time fix and repeat visit rates
- Planned preventive maintenance schedules and site asset registers
- Debtor and creditor ageing by client with agreed payment terms, and unbilled work at balance date
- After-hours roster and help desk arrangements, including any outsourced call handling
- Tender history and current pipeline, including panel registrations and renewal dates
What a facilities maintenance business valuation costs
Fixed fees, confirmed in writing before work begins. The standard fee applies to most established facilities maintenance businesses.
Independent Business Valuation
$1,995+ GST
For established trade and field-service businesses requiring an independent valuation.
- Review of financial information
- Normalisation of earnings
- Valuation methodology selected for the business and purpose
- Industry and business risk assessment
- Consideration of plant, vehicles and equipment
- Owner dependency assessment
- Goodwill analysis
- Valuation range and conclusion
- Professionally prepared valuation report
- Draft provided before finalisation
Accountant and Adviser Partner
$1,495+ GST
For accountants and professional advisers who refer valuation matters regularly.
- Streamlined client onboarding
- Adviser kept informed with client authority
- Independent report addressed to the client
- Secure document portal for the client
- Repeat-client workflow
- Partner pricing on every referred matter
Complex Valuations
From$2,995+ GST
For matters with more moving parts. Quoted as a fixed fee in writing before work begins.
- Multiple entities or divisions
- Significant plant and equipment
- Unusual ownership structures
- Partnership and shareholder disputes
- Complex normalisations
- Significant customer concentration
- Historical valuation dates
Fees are fixed and confirmed in writing before work begins.
Facilities Maintenance valuations: common questions
How much is a facilities maintenance business worth?
A facilities maintenance business is generally worth what its maintainable earnings support after a market wage is paid for the owner’s own work, adjusted for how secure its contracts and key relationships are. Longer contracts, planned maintenance revenue and a spread of clients support a higher value; reliance on one national account or on the owner reduces it. Our guide on recurring maintenance contracts and business value explains how contract revenue is weighed.
Is the money I pass to subcontractors counted as my revenue?
That depends on how the accounts present it, and we look through the presentation to the margin. Whether subcontractor invoices sit in revenue and cost of sales or are netted off, profit is the same, but the revenue and margin percentages are not. We restate on a consistent basis, because a buyer pays for the margin the business earns on that work, not for the pass-through amount.
Most of our work comes from one national account. Can the business still be valued?
Yes. Concentration on a national account is common in facilities maintenance and does not prevent a valuation. The report will look at the contract term, rebid history, how the account is serviced, the abatement record and what earnings would be if the account were reduced or lost. Our guide on customer concentration and business value explains how this is weighed.
Do KPI abatements affect the value of the business?
Yes, because they are a direct cost of missing service levels and a sign of how securely a contract is held. We look at the abatements applied over the last two or three years, the reasons, and whether the business’s systems and after-hours cover are good enough to avoid them in future. Repeated abatements on a major contract usually raise the risk applied to its earnings.
Related industries and guides
Valuing a facilities maintenance business? Start with a short intake.
An Independent Business Valuation is $1,995 + GST, with a draft before the report is finalised. Typical turnaround is 3 to 7 business days once all required information has been received.