Will You Make This Expansion Mistake?

Hello home service operators,

Thinking of expanding? Yea? Me too. As exciting as it can be, there’s a lot of groundwork to lay and many high-level decisions to make.

Below, I unveil my thoughts on the hidden cost of “cheap” markets, but first:

• AI is changing the sales game in the home service space

• Unlock the lead source thousands of home service businesses use

• Learn how to protect profits, keep your techs booked, and grow in a down market

• There’s a better way to predict monthly revenue increases (hint: it’s a data feedback loop)

• If you’re considering an SBA loan, check out the MySBA Learning platform for entrepreneurs

• I'm joining forces with Chris Hoffmann this week for a live training on protecting your bottom line, keeping your techs booked, and more

Short on Leads? It Can Kill Your Business

As a home service business operator, there’s one thing you CAN’T be short on: leads.

I spend a lot of time thinking about fresh ways to generate leads, but I also lean on Service Scalers to keep the engine running at all times.

Here’s the type of results they drive.

Fear of running out of leads is not a good feeling. Rather than take on this monumental task yourself, it may be time to outsource it to an agency like Service Scalers.

Contact Service Scalers for 1-month free with any 12-month contract...good for any service. A quick conversation could clear up your biggest fear as a business owner.

The Hidden Risk of “Cheap” Markets

There’s a mistake in acquisitions that almost no one talks about. It looks smart at first glance: buy cheap HVAC companies in small towns where no one else is competing.

The deals are inexpensive. The market is wide open. And on paper, you can “own the town” overnight.

But here’s the catch: those markets rarely get bigger than $5–6 million in revenue. The population just isn’t there.

You think you’re buying opportunity. What you’re really buying is a ceiling.

Why Easy Markets Aren’t Always Worth It

Cheap markets tempt operators because they feel controllable. No competitors breathing down your neck. No crazy bidding wars with private equity. Just you and a handful of customers.

But here’s something to chew on:

• Population is destiny. No matter how well you run, a town of 20,000 caps out quickly.

• Labor is scarce. Finding the right operators in rural markets is harder than selling work.

• Exit options shrink. PE doesn’t want $5M businesses “in the middle of nowhere.” They want scale, density, and demographics.

The irony is this: what looks easiest up front often turns into the hardest business to grow.

The Trap Operators Fall Into

I’ve seen this play out more than once. On the surface, small markets feel like a shortcut. The deals are cheaper. The path to dominance is shorter. And the market is yours to lose.

But that’s the illusion.

I’ve looked at HVAC companies for sale in towns of maybe 20,000 people. They might be doing $5–6 million in revenue, and they’re the biggest player in town. But here’s the problem: that’s also the ceiling. You can’t grow much beyond it because the population won’t support it.

That’s the trap. You think you’re buying scale, but what you’re really buying is a cap.

I’ve also watched operators underestimate the labor problem in these markets. In theory, you can market more cheaply in a small town — leads aren’t hard to come by. But then comes the harder part: finding and keeping good people. In tiny markets, labor is scarce. You need a strong operator willing to run a limited business in a limited market, and those people are almost impossible to find.

Private equity won’t touch these deals for the same reason. They know there’s no exit path. You’re not going to build a $20M business out of a town that maxes out at $5M. You’re not going to attract institutional buyers when the demographics don’t work.

So when I see a “cheap” deal in a tertiary city, the first thing I ask myself is: if it’s so easy to win here, why hasn’t anyone else done it? And most of the time, the answer is simple. The market isn’t good. It’s already maxed out. And that’s why the deal looks attractive on the surface.

That’s the trap operators fall into. They chase the easy win and end up stuck with a business that can’t grow, can’t attract talent, and can’t be sold for more than they paid for it.

The Better Question

The next time a broker hands you a “can’t-miss” $2M HVAC business in a tertiary city, don’t start with price. Don’t start with EBITDA.

Start with the only question that matters:

“Is this market worth owning?”

Because cheap deals aren’t always good deals. And the wrong market will cap your growth before you’ve even started.

The Smarter Way to Staff Your Call Center

Hiring CSRs doesn’t have to be difficult…but many home service companies find that it is.

Rather than continue to struggle, it’s time give Quick Staffers a closer look.

Here’s what they bring to the table:

CSRs who actually know what they’re doing
Trained in CRM tools, scripts, SOPs, and how to talk to customers like pros—not robots.

Payroll relief that doesn’t sacrifice quality
Rates start at just $2,000–$2,500/month, so you can reinvest the difference into growth.

Longer retention, better performance
Fewer headaches. More consistency. And no revolving door of reps.

Scales with you
Need to add another rep? No problem. Quick Staffers grows with your demand.

Want another reason to use Quick Staffers?

Right now, you’ll get $500 off your first placement. Click the button below to grab your discount and finally get the CSR help you need.

I’m not saying you should never acquire a home service business in a small market. However, you need to take extreme caution. It may not be the grand slam that it appears to be.

👊 John

Disclosure: Some of the content and links in this newsletter are sponsored or affiliate links, which means we may receive payment or earn a commission if you click through or purchase. However, all opinions expressed are entirely my own.

Want More Owned and Operated?

📻 Listen to Owned and Operated on YouTube, Spotify, and Apple 

📰 Subscribe to the JackQuisitions newsletter here

🤝 Get your brand in front of 40,000+ home service business owners here