Kitchen and bath remodeling company in Linden, Michigan
A food science and chemistry graduate turned construction marketing specialist and lifelong entrepreneur, now the owner of an 80-year-old family-owned kitchen and bath remodeling company.
Background, challenges, and motivation
This is the first business I’ve ever bought, but not the first I’ve owned. I’ve always had something going, even small businesses on the side while raising my kids. About 12 to 15 years ago, I owned and grew my own business and was the “chief everything officer.” I was doing everything myself, and it was too much at the time, so I took a 9 to 5 job, which I actually really enjoyed. When I started thinking about owning a business again, I knew I didn’t want to start from the ground up. I wanted to start in the middle, after that initial phase was already done. That’s how I found The Exit School.
Background on the Business
What business did you acquire?
Linden Kitchen and Bath, a kitchen, bath, and home remodeling business in Linden, Michigan, about seven minutes from Gunilla’s home.
When did the acquisition take place?
May 8.
Condition of the business at purchase
About $3.4 million in annual revenue with roughly $475,000 in owner earnings. The previous owner was only working about 10 hours a week in the business. There was a strong, lean team in place of four designers and salespeople, all paid on commission. The business had done very little marketing, with most jobs coming from referrals and business relationships. Pricing was below industry standard, and the books were run on paper with written ledgers and printed invoices.
What attracted you to this business?
It was close to home, which was part of her buy box. It had a team in place and was already bringing in revenue. Because the previous owner was only working about 10 hours a week, Gunilla knew stepping in could only add to it. Marketing was the business’s weak spot, and with her marketing background, it was a natural fit.
The Transformation
Business plan for the next year
Put the Profit First financial plan in place, launch a marketing plan, bring pricing in line with competitors and industry standard, and keep building trust with the team. The longer term plan is to pay off the business and buy out the investors within five years. Gunilla doesn’t plan to exit. Her son is interested in becoming a designer and may tentatively be the next owner, carrying on the business’s 80-year legacy as a family-owned company serving the community.
Top priorities in the first 90 days
Getting to know the business and building relationships with employees, since she wasn’t able to meet them before the purchase. Setting up a marketing plan in partnership with The Exit School. Reviewing finances with the finance team to make sure money is being spent where it makes sense and cutting unnecessary costs.
First operational changes
Moving off paper ledgers and printed invoices. Gunilla intentionally kept changes minimal at first, since the sale was a surprise to the team.
Staffing or team structure
The team stayed in place. Gunilla added a weekly team meeting to review projects, check in, and share updates. The team is excited about having a voice, owning their work, and contributing ideas for growth.
Marketing or customer acquisition
Building and launching a full marketing plan with The Exit School, moving beyond the business’s reliance on referrals and relationships. Gunilla is also more actively involved with customers than the previous owner, reaching out proactively with updates rather than only stepping in when problems come up.
Systems, tools, processes, and financial management
Moving to digital bookkeeping, implementing Profit First, and planning price increases to reach industry standard.
Results
Revenue at acquisition
About $3.4 million, with roughly $475,000 in owner earnings.
Revenue now
Too early to report. Gunilla projects that pricing changes alone, with nothing else changing, could bring revenue to about $4.5 million.
Financing
The seller’s asking price was $3.4 million plus $800,000 for the building. Gunilla was approved for an SBA loan, but five different SBA loan officers said they would not finance at that price. That gave her leverage to go back to the owner, who ultimately agreed to a $1.3 million purchase price and to seller finance 70% of the deal at 6%, amortized over 15 years with a balloon payment after five years. The 30% down payment came from investors, raised with The Exit School’s help through WeFunder, along with funds from Gunilla’s retirement plan.
Team morale or retention
The team is excited to work with her, eager to share ideas, and motivated by the growth potential since they’re paid on commission.
Customer satisfaction
Too early to compare. Many current customers started after the transition, and Gunilla is taking a more proactive role in customer communication than the previous owner.
The Role of Exit School
How Exit School supported you
“We would not have done this deal without The Exit School.” They were there to bounce ideas off, answer whether something was normal, and guide the process. The negotiation training was especially helpful, and Gunilla says she never would have thought to ask about seller financing without it. The Exit School also helped her find investors for the down payment, and she partnered with them post-purchase for support through the first 90 days.
Most valuable part
The support and the knowledge base, which saved her hours of research. Most of all, the emotional support. “I can tell you all the numbers, we saved on this and saved time. But the emotional part I can’t quantify, and that’s probably been the most valuable to me.”
Specific tools or systems
Negotiation training, investor fundraising support, and guidance on using her retirement funds toward the down payment.
Personal Reflections
Most rewarding part
Money is already coming in, unlike starting a business and waiting to get out of the red. Before, she ran everything alone. Now she has a great team of designers and The Exit School behind her. “That is a dream come true, really. I’m excited to go to work every day.”
Challenges and how you overcame them
Gunilla’s family went through a personal tragedy during the process. She says that without The Exit School’s support, she would have walked away and revisited it later. “They cared about us as individuals, not just our business.” The other challenge was mental. She started out looking at businesses under $500,000, and Amy asked why she wasn’t looking at businesses that would automatically replace her income. That conversation opened her up to the possibility of buying a business this size. “I know I wouldn’t have. I would have been like, that’s too much.”
Advice for new operators
“Work with The Exit School. But also be grateful. There are a lot of changes, and being grateful keeps my mind in a good place. Don’t limit yourself. All things are possible.”
