Franchised Auto Paint & Collision Center, Orange County CA

$4.1M

Revenue

$552K

SDE

3.3x

Multiple

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Full Editorial Writeup

This is an established collision and auto paint operation running under a recognized franchise brand in one of Southern California's busiest automotive corridors. The shop generated roughly $4.1M in revenue and $552K in SDE on a diversified book of retail, insurance, and fleet/commercial work, which is exactly the kind of mix that smooths out demand when consumers get cautious. The single facility is 10,350 square feet, purpose-built for high-volume body work, with a truck-sized drive-through paint booth, frame machine, dual compressors, and solar panels that cut operating costs. Note the title says 4-location but the disclosed detail (one facility, 8 employees, one lease) reads as a single site; that discrepancy is worth resolving early.

The business is genuinely manager-run. A general manager and full production crew are already in place, and estimating, production, and customer service processes are documented and transferable. That makes it viable either for a hands-off owner treating it as a cash-flowing asset or for an existing automotive group folding it into a larger platform. The long lease (through 2046) and a decade-plus of local brand equity give the operation a defensible position in a market the listing claims has few comparable independents.

The caveat that keeps this from being a slam dunk is timing. 2024 did $4.346M revenue but only $380K EBITDA, the industry softened in 2025, and the seller is leaning on a 2026 forecast that is "already tracking ahead." A buyer needs to underwrite to trailing performance, not a hoped-for rebound, and understand why cash flow and EBITDA diverge so widely in the numbers presented.

Why we like it

Earnings quality is anchored by a diversified revenue mix across retail, insurance, and fleet, with high average tickets and low receivables. Collision and paint work is need-based repair, not discretionary spend, so demand holds up when the economy softens. At $552K SDE on $4.1M revenue, margins are respectable for a body shop.
The moat is real and local: a franchise brand, over a decade of operating history, a purpose-built high-volume facility, and few comparable independents in a dense Southern California corridor. Insurance direct-repair relationships and fleet accounts are sticky and hard for a new entrant to replicate quickly. The 2046 lease locks in a prime location for the long term.
This is already manager-run with a GM and a full production crew, so the business survives the transition and fits a passive owner or a bolt-on acquirer. Documented estimating, production, and CS systems reduce key-person risk on day one. That is rare in a trades-heavy category where the owner is usually the constraint.
Operator upside is concrete: the facility reportedly has excess capacity, and fleet, commercial, and insurance channels are described as not fully tapped. A buyer with an existing automotive group can layer in volume without adding fixed overhead. Solar panels and a fixed favorable rent structure protect the cost base.

How to improve it

Reconcile the 4-location claim against the single-facility detail in the listing within the first week of diligence, because it materially changes the deal thesis and price. If it truly is one site, negotiate the multiple down toward a single-location comp. If there are four, verify leases, staffing, and financials for each.
Push hard on insurance direct-repair program enrollment in the first 90 days, since insurance-fed volume is the highest-frequency, lowest-acquisition-cost work in collision. Audit which carriers the shop is approved for and target adding one or two more DRP relationships. This is the fastest path to fill the excess booth capacity.
Build out the fleet and commercial book that the listing flags as underdeveloped. Sign municipal, rental, and last-mile delivery fleets to standing-account arrangements with negotiated rates and priority scheduling. Fleet revenue is recurring and smooths the retail seasonality.
Tighten cycle time and throughput metrics with the existing GM, targeting keys-to-keys reduction and higher touch-time per tech. Faster turns increase both car volume and insurer scorecard ratings, which drives more DRP referrals. Small throughput gains flow almost entirely to the bottom line given fixed overhead.
Reconcile the SDE-versus-EBITDA gap ($552K SDE vs $448K, then $380K for 2024) and rebuild a clean owner-adjusted earnings figure. Standardize monthly financial reporting and a KPI dashboard so the passive-owner model actually works. You cannot manage a manager-run asset without instrumentation.
Formalize the local marketing engine the seller references rather than relying on brand walk-ins. Layer in Google Local Service Ads, review generation, and referral partnerships with dealers and body-adjacent trades. Cheap demand generation fills capacity that already exists.
Evaluate raising labor and paint-and-materials rates to current SoCal market, since 2024 EBITDA compression suggests pricing may lag cost inflation. Even a modest rate increase on need-based repair work rarely loses volume. Pair it with a supplement-capture process to recover money left on estimates.

Diligence notes

Resolve the location count immediately. The headline says 4-location platform, but disclosed details show one 10,350 sq ft facility, 8 employees, one lease, and one paint booth. This is the single most important fact to verify, because the price and multiple only make sense if you know exactly what you are buying.
Reconcile the conflicting earnings figures: $552K cash flow, $448K EBITDA, and a stated 2024 result of $4.346M revenue with only $380K EBITDA. Get three years of tax returns and P&Ls, and understand the industry-wide 2025 softness before trusting the optimistic 2026 forecast. Underwrite to trailing actuals, not projections.
Confirm the franchise terms in full: royalty and marketing fees, transfer approval, remaining term, renewal rights, and any required capital reinvestment. Franchise obligations can meaningfully reduce the true owner earnings shown as SDE. Verify the franchisor will approve your buyer profile and structure.
Scrutinize the insurance direct-repair relationships and customer concentration. Identify how much revenue depends on a single carrier or a handful of fleet accounts, and whether those relationships transfer with the sale or are personal to the seller. DRP status can be revoked and is not guaranteed to carry over.
Verify the lease economics and terms: $13,371/month through 2046 is long and favorable, but confirm escalation clauses, assignability, and any landlord relationship to the seller. A below-market or above-market rent changes both valuation and go-forward cash flow. Long tenure only helps if the terms hold.
Assess the GM and production crew retention risk given a retirement sale and a manager-run model. Interview the GM, review compensation and any non-competes, and understand whether the crew stays post-close. In a passive-owner thesis, losing the GM is the deal's biggest single point of failure.

Source

Originally listed on BizBuySell. View original listing →