How to Value a Janitorial Supply Company in 2025

How to Value a Janitorial Supply Company in 2025

If you’re considering selling your janitorial supply business, determining its value is the first step. This guide will walk you through the key aspects of valuing a janitorial supply company in 2025, combining expert insights and current market trends to help you understand what your business is worth.

Why is Valuation Important?

Understanding the value of your janitorial supply business is essential for several reasons:

• The Janitorial Supply Sector is experiencing a rapid consolidation as large, national players and regional companies acquire smaller competitors to increase their geographic markets and overall market share. To understand more about this trend, read our article What’s Driving Acquisitions in the Jan-San Sector in 2025.
• Setting a realistic sale price: A proper valuation helps you set a realistic asking price, attracting serious buyers and avoiding wasted time. The number one reason companies don’t sell is that sellers have unrealistic expectations of value. So getting this right from the start is essential.
• Negotiating effectively: Knowing your company’s value empowers you to negotiate favorable terms.
• Making informed decisions: Valuation provides a clear picture of your company’s financial health and potential, guiding your decisions throughout the sale process.

Janitorial Supply Market Overview

The janitorial supply market forms an integral component of the broader facilities management sector, with a global market size valued at USD 31.15 Billion in 2023 and projected to reach USD 40.26 Billion by 2031, exhibiting a Compound Annual Growth Rate (CAGR) of 2.9% during the forecast period of 2024-2031.

In the United States specifically:

• The U.S. Facility Services market was sized at $267.8 billion in 2024 and is projected to grow steadily, reaching $370.7 billion by 2029.
• The U.S. Janitorial Services market alone had a size of $80.4 billion in 2024 and is forecast to increase to $92.3 billion by 2029.
• The Cleaning & Maintenance Supplies Distributors in the US generated approximately $9.9 billion in revenue in 2024, although this segment has experienced a decline at a CAGR of 2.4% over the past five years.
• The Janitorial Equipment Supply Wholesaling in the US reported revenue of $29.3 billion in 2024, with a modest growth of 0.5% CAGR over the previous five years.

Factors That Affect the Sale Price

The ultimate sale price of your janitorial supply company depends on a variety of factors:

• Financial Performance: Strong financial metrics including consistent revenue growth, healthy profit margins (EBITDA and net income), and stable cash flows significantly impact valuation.
• Customer Base: A diversified customer portfolio with low concentration reduces risk and increases value. High customer retention rates and long-term contracts indicate stability and predictable future revenue streams.
• Operational Efficiency: How efficiently your company manages its operations directly impacts profitability and attractiveness. Streamlined supply chain management, effective inventory control, and technology adoption for enhanced productivity all contribute to a higher valuation.
• Market Position and Competitive Landscape: Your company’s standing within the janitorial supply market, including market share, brand recognition, and geographical reach, influences its valuation.
• Management Team and Employee Stability: The experience, expertise, and stability of your management team are critical factors. Low employee turnover and a skilled workforce are positive indicators of a well-run business.
• Risk Profile: Overall risk factors associated with your business significantly impact valuation. These can include customer concentration, reliance on key personnel, financial instability, and potential regulatory challenges.
• Growth Potential: A business with clear growth potential, such as an expanding customer base or entry into emerging market segments, is more valuable.
• Product Mix and Specialization: Companies offering specialized or proprietary products often command higher valuations than those selling only commodity items.

Janitorial Supply Company Valuation Methods

Here are several methods you can use to determine the value of your janitorial supply company:

• Market Approach: This involves analyzing past market transactions of similar janitorial supply companies to establish a valuation basis. However, accessing transaction data for privately owned companies can be challenging.
• Cost-based Valuation: This approach calculates the cost of creating a similar company from the ground up, including tangible and intangible assets.
• Asset Approach: This method determines the net value of a business’s assets minus its liabilities. It’s crucial to use the market value of your equipment and inventory, and factor in goodwill or intangible value.
• EBITDA Multiples: This common approach applies an industry multiple to your company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization).

Understanding EBITDA Multiples for Janitorial Supply Companies

EBITDA is a key metric for valuing janitorial supply companies. Here’s how to calculate it:

EBITDA = Net income + Interest + Taxes + Depreciation + Amortization

For privately owned janitorial supply companies, we often use Adjusted EBITDA:

Adjusted EBITDA = Net income + Interest + Taxes + Depreciation + Amortization + Owner Addbacks

Owner addbacks might include owner’s salary above market rate, personal expenses run through the business, one-time expenses, and other discretionary expenses that a new owner might not incur.

To determine your company’s value using EBITDA, you’ll calculate:

Your janitorial supply company’s value = Adjusted EBITDA × EBITDA Multiple

Current EBITDA Multiples for Janitorial Supply Companies in 2025

The valuation multiples for janitorial supply companies vary based on several factors, including company size, profitability, market position, and risk profile. Based on recent transactions and market data, here are the approximate EBITDA multiples:

EBITDA Multiples for Privately Owned Janitorial Supply Companies, Q1 2025

It is important to note that these multiples are current as of Q1 2025 and are subject to change based on market conditions.

Data from previous years indicated a mean EBITDA multiple of 8.3x and a median of 8.2x for M&A deals in the Janitorial Industry, while publicly-traded comps had higher mean and median multiples of 11.0x and 10.7x, respectively.

Revenue Multiples for Privately Owned Janitorial Supply Companies, Q1 2025

Data from previous years showed that the mean revenue multiple for Janitorial Industry M&A deals was 0.6x, with a median of 0.5x, while publicly-traded comps showed a mean of 1.4x and a median of 1.0x.

Other Factors Affecting the Value of a Janitorial Supply Company

Several other factors can influence the valuation of your janitorial supply company:

• Customer Type: Companies serving commercial, industrial, or healthcare sectors may be valued differently based on the stability and growth potential of these end markets.
• Recurring Revenue: Businesses with subscription-based models or long-term service contracts typically receive higher valuations due to predictable revenue streams.
• Technological Integration: Companies that have invested in e-commerce platforms, inventory management systems, or other technological solutions often command premium valuations.
• Brand Strength and Reputation: A strong brand with high recognition and positive reputation can significantly enhance company value.
• Geographical Footprint: Companies with a broader geographical presence may be more attractive to buyers looking to expand their market reach.
• Sustainable/Green Product Offerings: Companies focusing on environmentally friendly products may attract premium valuations due to growing market demand for sustainable solutions.

Trends in Janitorial Supply M&A in 2025

Several trends are shaping the M&A landscape for janitorial supply companies in 2025:

• Continued Consolidation: The industry is experiencing significant ongoing M&A activity, with private equity firms playing a prominent role. Companies like Imperial Dade (an Advent portfolio company) and BradyIFS + Envoy Solutions have been particularly active in acquisitions.
• Buy-and-Build Strategies: Private equity firms are implementing “buy-and-build” strategies, acquiring platform companies and then adding on smaller, synergistic businesses to build scale, expand geographic reach, and deepen service capabilities.
• Focus on Technology and E-commerce: Buyers are increasingly valuing companies with strong digital capabilities and efficient operational systems.
• Emphasis on Sustainable Solutions: Companies offering eco-friendly and sustainable cleaning products are attracting premium valuations due to growing market demand.
• Strategic Buyers Seeking Synergies: Larger existing companies are participating in M&A to achieve economies of scale, expand market presence, or gain access to new technologies and customer segments.

The Value of Expert Guidance

Selling a janitorial supply company is a time-intensive and complex undertaking. Engaging an M&A advisor with experience in the janitorial supply sector can significantly increase your chances of a successful sale at the best possible price. An M&A advisor with experience in the janitorial supply sector can:

• Help you accurately value your business
• Prepare necessary offering documents and financial models
• Market your company effectively to financial and strategic buyers
• Negotiate favorable terms
• Manage the due diligence process
• Ensure a smooth closing and transition

By understanding the key valuation methods, market trends, and preparation steps, you can confidently navigate the sale process and achieve the best possible outcome for your janitorial supply business.

About the Author and Jackim Woods & Co.

Rich Jackim is an investment banker, entrepreneur, and former mergers and acquisitions attorney.

For the last 25 years, Rich has been providing boutique investment banking services to middle-market companies in a wide range of industries, including the janitorial supply sector.

Rich also founded a successful training and certification company called the Exit Planning Institute, which he sold to a private equity group in 2012.

Rich is also the author of the critically acclaimed book, The $10 Trillion Dollar Opportunity: Designing Successful Exit Strategies for Middle Market Businesses.

Jackim Woods & Co offers skilled mergers and acquisitions advisory services to privately owned janitorial supply companies in both sell-side and buy-side transactions. Jackim Woods & Co has arranged over 100 successful transactions, ranging from less than one million to more than eighty million dollars in value.

If you own a janitorial supply company and are interested in exploring your options, I would welcome an opportunity to speak with you.

Feel free to contact me at 224-513-5142 or rjackim@jackimwoods.com.