⚡ TL;DR:

The CIM lists the top customer at 18% of revenue. Looks manageable at LOI. The QoE comes back six weeks later with the cut the CIM didn't show: that same customer is 30% of gross profit. The SDE still ties out. The multiple does not.

Where the real concentration hides. revenue cut versus gross profit cut. is the diligence step most buyers skip.

Inside: the threshold ladder lenders actually use (10%, 20%, 30%), the four SBA-compatible structures that work when earnouts don't (purchase price reduction at closing, forgivable seller note tied to retention, retention-based performance escrow, consulting agreement with transition milestones), and the rep-based indemnity escrow that quietly does the most work in the purchase agreement.

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Cook County, Illinois manufacturer with over a century of operation in commercial plumbing fittings, hospital fixtures, and toilet partition hardware. Three production divisions running CNC turning, boring, and engineered tooling out of an Illinois facility. Five employees (3 FT, 2 PT), wages $22–$40/hr with a 401k in place. Owner is the active CEO; spouse handles QuickBooks (replaceable with a part-time bookkeeper). Real estate is available separately at $1.06M.

Why this deal stands out: 100 years of operating history in a niche metals-manufacturing book is the kind of moat new entrants do not replicate. The 39.8% SDE margin signals pricing power on engineered-spec products. commercial plumbing fittings sold into hospital systems and partition-hardware OEMs are bought on reliability, not lowest bid. Seller financing available adds structural flexibility on price, and the $172K inventory included means no day-one working-capital outlay.

💡 EBIT Take: The transition risk is the active-CEO model, not the business itself. Diligence priorities: (1) customer concentration on the top 3 hospital systems and OEM accounts. exactly the gross-profit-vs-revenue cut covered in this week's deep-dive, (2) which named buyers at customer orgs are anchored to the seller, (3) machinist tenure (5 employees is small enough that one departure is structural), and (4) whether the $1.06M real estate buy makes the deal cleaner via SBA 504 financing. Best fit: a buyer with manufacturing or industrial sales background.

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Los Angeles County home health care treatment center listed by AI Business Brokers of America. The facility generates roughly $3 million in annual revenue with EBITDA of $781K. a 26% EBITDA margin. Furniture, fixtures, and inventory are included in the asking price.

Why this deal stands out: A 3.2x EBITDA multiple on a healthcare facility with 26% margins clears SBA 7(a) financing math comfortably. DSCR 2.22x and cash flow after debt of $429K give the buyer real breathing room on integration spend in year one. Home health is structurally tailwind-positive in LA County: aging population plus payer pressure to keep patients out of inpatient settings.

💡 EBIT Take: The disclosure on this listing is thinner than ideal. EBITDA appears in the body description but the stat box shows cash flow as undisclosed. Diligence priorities: (1) payer mix and Medicare/Medicaid reimbursement exposure, (2) caregiver licensing and state CCL/CDPH compliance, (3) referral pipeline structure (hospitals, discharge planners, physician offices) and how concentrated those referrals are. the customer-concentration framework in this week's article applies here as much as it does to manufacturing, and (4) any pending state survey or audit findings. Best fit: a healthcare operator or a clinical-services-savvy SBA buyer.

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Southern California freight brokerage listed at $4M asking with $1.2M in cash flow on $6M of sales. NDA and proof of funds required for the broker book and customer roster. Listed Apr 27, 2026 on DealStream.

Why this deal stands out: Freight brokerages sit on top of the customer-concentration bell curve. the typical book has a long tail of small shippers and a fat top with a handful of national accounts. A 2.12x DSCR plus $635K cash flow after debt gives the buyer enough cushion to weather one or two top-shipper losses without breaking the loan covenant. This is exactly the profile the customer concentration framework was built for.

💡 EBIT Take: Run the gross-profit-by-customer cut before LOI. not just revenue. Brokerages typically show low margin on their largest accounts (those customers negotiate hardest) and high margin on the long tail. If the top 3 shippers carry 60%+ of gross profit, this is a 30% concentration deal in disguise. Other diligence priorities: (1) carrier liability and bond status, (2) factoring relationships and cash-conversion-cycle pressure, (3) MC/MX authority transfer and FMCSA compliance under change of ownership, and (4) the disclosure constraint. NDA-only data means the broker is gating the customer book until late in diligence, which is the right time to renegotiate price if concentration surfaces.

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Lee County, Florida marine contracting company specializing in seawalls, docks, boat lifts, and shoreline improvements for residential and light-commercial waterfront clients. Turnkey operation includes a fully equipped barge plus essential marine construction equipment, with approximately $550K in work-in-progress providing immediate revenue pipeline. Strong local reputation with repeat customers and referral-based growth.

Why this deal stands out: Marine contracting in Florida sits in a niche where licensed operators with their own barge are the moat. boat lift and dock work cannot be subbed out cheaply, and waterfront permitting expertise compounds with reps. A 1.49x SDE multiple plus a 4.75x DSCR is the kind of deal where the financing math works at multiple price points, even before negotiating off the seller's asking price. Listed as "May Qualify For Visa," which signals motivated seller flexibility.

💡 EBIT Take: The seller is asking $600K down on a $700K deal. that's an unusual structure that essentially asks for cash, not standard SBA. The DSCR works at standard 10% SBA terms ($70K down, $630K loan), so this is a price-and-structure negotiation. Diligence priorities: (1) FL marine contractor licensing transferability and any disciplinary history, (2) the $550K WIP. contracted vs. estimated, (3) barge condition and recent inspection, (4) waterfront permitting relationships with Lee County and FDEP, (5) seasonality of FL marine work post-hurricane season. Best fit: an operator with marine, construction, or waterfront-permitting background.

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An 80-year-old distribution business in Camden County, New Jersey with consistent profits and a stable, loyal customer base. SBA pre-approved for a qualified buyer with $183K down and projected first-year cash flow after debt of $229K, with the real estate also included in the deal. Bank financing package includes a $150K line of credit for working capital. Listed by Benjamin Ross Group.

Why this deal stands out: 80 years of consistent profits in distribution implies the kind of supplier relationships and customer routes that take decades to rebuild. SBA pre-qualification means the financing is essentially de-risked. $183K of buyer cash plus a structured loan package the lender has already vetted. Real estate inclusion converts the deal into an SBA 504 candidate as well, which can lower the blended cost of capital. Camden County is a logistics-friendly NJ submarket with NYC and Philly distribution access.

💡 EBIT Take: Eighty-year businesses sell because the seller is retiring or dying, and the diligence question is always: how much of the goodwill is people, and how much is process. Diligence priorities: (1) employee retention plan and key driver/route owner agreements, (2) top customer tenure and concentration cut on gross profit (the exact framework in this week's article), (3) supplier MFN and exclusive-distributor agreements that may have change-of-control clauses, (4) real estate appraisal vs. the deal price, (5) industry. distribution of what. driving LTV and SKU velocity. Best fit: a buyer with logistics, distribution, or warehouse operations background.

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Salt Lake County, Utah specialty concrete chipping company providing on-site concrete cutting and chipping services to commercial and industrial clients. Founded 1998. 28 years of operation. Six employees, $475K of FF&E and $20K inventory included. Owner is retiring after building a referral-driven niche-services book.

Why this deal stands out: A 48.5% SDE margin in specialty industrial services is the kind of unit economics that signals the operator owns a niche where price competition is muted. 28 years of pure-referral growth means no marketing-spend dependency for a new owner to maintain. At 2.02x SDE the multiple is unusually low, and the 3.47x DSCR gives the buyer real room to absorb working-capital and equipment surprises in year one. $475K of FF&E included means roughly 43% of the asking price is hard assets.

💡 EBIT Take: The seller is asking $900K down on $1.1M. read that as "I want a cash buyer," not as the SBA structure that actually clears at standard 10% down. The DSCR works at standard SBA terms (calculations above use 10% down). Diligence priorities: (1) commercial and industrial customer concentration on the top 3 to 5 accounts (this week's article applies), (2) equipment age and remaining useful life on the $475K FF&E, (3) crew tenure on the 6-employee operation, (4) operator licensing and any required Utah-specific certifications, (5) the seller's preferred down payment as a price-negotiation lever. Best fit: an operator with construction services, industrial trades, or specialty contractor background.

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💡 EBIT take: Smart short cut to see if the deal pencils. The 3.75x SBA-debt rule of thumb plus a 30% target equity return turns a list of asking prices into a hurdle rate. The deals that clear it are the ones worth diligence; the ones that don't tell you how much price reduction to negotiate to get it done.

Disclaimer: This guide is for educational purposes only and does not constitute legal, financial, tax, or investment advice. Business acquisitions involve significant risks, and outcomes can vary widely based on individual circumstances. Always consult with qualified professionals including attorneys, CPAs, and financial advisors before making acquisition decisions. The EBIT Community does not guarantee the accuracy of information provided or the success of any acquisition strategy. Past performance and examples do not guarantee future results.