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Electrical contracting business Sale-Prep Checklist

Licenses, documents and fixes buyers look for when you sell a electrical contracting business

Know your number

[ ] Recast earnings to SDE (and adjusted EBITDA if above about $1M of earnings)
[ ] Run the electrical contracting business valuation calculator and save the brief
[ ] Estimate after-tax proceeds under asset vs stock sale

Licenses and transfer issues for electrical contractors

Done	Issue	What to know
[ ]	State contractor license	Usually tied to the entity and a qualifying individual. In California a license cannot be transferred to a new entity; a new owner or entity applies for its own license, posts new bonds and shows workers' comp coverage.
[ ]	Qualifier / master license holder	If you are the qualifier (RMO/RME, master plumber or electrician), the license qualification leaves when you do. The buyer needs a qualified person in place before closing, or you agree to stay on for a transition.
[ ]	Bonding	Surety bonds are underwritten on the owner and the company. A buyer must carry the bonding program to keep bonded backlog.

Documents buyers will ask for

[ ] 3 years of financials and WIP schedules
[ ] Backlog by customer with margins
[ ] Service vs project revenue
[ ] Master and journeyman license roster
[ ] Bonding capacity and surety letter
[ ] Union agreements, if any

Fix what buyers discount

[ ] Owner dependence: document processes, delegate selling and scheduling, cut your hours in the work
[ ] Customer concentration: no single customer above about 15% of revenue
[ ] Recurring revenue: convert one-off customers to agreements or plans
[ ] Clean books: separate personal expenses, reconcile monthly, keep 3 years of tax returns ready

Deal structure notes

Individual buyers use SBA loans and seller notes; platforms pay cash plus rollover; backlog-heavy contractors may see earn-outs tied to job completion.

Timeline

Plan for 6-10 months on a Main Street sale; commercial contractors with backlog and bonding reviews can take longer.

Rules vary by state; confirm licensing and transfer requirements with counsel. General information, not legal or tax advice.

Free template from TradeExit Guide. Edit freely for your business.