If you’re running a successful HVAC business, you might be searching for the most efficient path to more revenue. If you’re already in the industry, acquisition is a proven way to expand your business. You’ll gain economies of scale through administrative and marketing consolidation. You may have technology such as customer relationship management systems (CRMs) that will make it easier to be proactive in meeting customer needs. You already know what it takes to succeed, and can take that experience into another company and get fast results.

Here are three signs that acquisition is the right move for you.

Your timeline for selling the company or retiring is a minimum of 3 – 5 years out.

If you’re planning on selling in less than three years, acquiring another company may not be the right option for you. You’ll need at least a few years to make a return on your investment (think branding, marketing, training, and all the other things that go into blending a new company into your own).

But if you have family in the business and the plan is for the next generation to take over, acquisition is probably the best decision you could make. There will be more business and more opportunities for everyone in the company, including technicians who might be ready to step up. If you have a great GM or lead tech in place, there’s not much room for your staff to advance. Rather than risk losing them, you can find a place for them to prove themselves in the new company. You’ll also benefit from acquiring talented staff from the other company.

You’re buying a company to grow, rather than to fix problems.

I always strongly advise owners to make sure their business is profitable and operating efficiently before they consider expansion. If your own operation has problems, acquiring another company will simply double them. Fix your management structure, problem staff, pricing structure, and costs before you venture into an acquisition. You may be taking on numerous issues in the new company, so ensure you remain focused on your current one.

You’re acquiring a company that has plenty of potential and low-hanging fruit that you can work with.

You’ll already achieve more profitability by adding customers, since you already have infrastructure like accounting, scheduling, and marketing in place. Adding upgraded technology, a solid sales plan, and maintenance agreements might not drain your resources but yield quick results.

If you stay local, you may also be buying out the competition, which gives you an enormous advantage, both while running the company and when it comes time to sell. Larger companies with large market share are easier to sell, attracting more buyers and better offers.

Becoming a larger company means you’ll be able to take better care of your staff. You may be able to provide benefits or a profit-sharing plan that you couldn’t afford before. And you can probably get better pricing and terms from your vendors.

And here’s some very good news: You may be able to make an acquisition with very little out-of-pocket cost. If you’re looking at SBA funding, you’ll find that owning a successful company in the industry makes you very attractive to lenders. And because you’ve increased sales while your salary and any economies of scale you’ve realized have come off the bottom line, the business is much more profitable from day one. You might be able to get the cost of the full acquisition financed for ten years with almost no personal investment.

That math makes acquisition a smart option for rapid growth. To view current HVAC and plumbing companies for sale, click here.