While everyone’s chasing unicorns,winners are chasing plumbers and roofers.
Buying a home services business isn’t rocket science......it’s actually harder. Because rockets don’t complain, call in sick, or get poached by your competitor down the street.
I’ve been analyzing home service segments. Flooring, Roofing, HVAC, Plumbing, Electrical, Landscaping, to decide where to place my next bet. It’s not just about chasing shiny profit margins or flashy market growth stats. You’ve got to consider recurring revenue streams, market fragmentation (roll-ups anyone?), labor availability (because robots aren’t installing roofs.....yet), and even how recession-proof each sector is.
The numbers point strongly toward HVAC and Roofing as solid investment choices. Both offer high margins, healthy average project sizes ($5K-$20K), and excellent opportunities to consolidate fragmented markets. HVAC, especially, checks the recurring revenue box thanks to annual maintenance contracts, while Roofing boasts higher ticket values and insurance-driven demand.
Plumbing and Electrical are reliable.....good, safe bets.....but labor shortages and intense competition might drain your patience (and wallet). Landscaping and Flooring? Attractive entry points, yes, but susceptible to economic downturns and limiting scale potential due to AOV.
I’m leaning HVAC and Roofing, but I’m all ears. If it was your capital on the line, where would you put your chips?