Sewer Smoke Testing Service
Municipalities pay contractors to find illegal sewer connections — you pump the smoke
Bottom line
Strong cash-flow candidate with manageable operations.
Sewer smoke testing is how municipalities, utilities, and industrial facilities locate illegal connections, infiltration points, and structural defects in underground sewer systems without excavation. The operator pumps non-toxic smoke into a sewer main segment; smoke emerging from unexpected locations — roof vents, yard drains, basement floor drains, storm grates — identifies defective connections or damaged pipe. EPA combined sewer overflow (CSO) regulations and CMOM (Capacity, Management, Operation and Maintenance) programs require utilities to maintain and document their sewer infrastructure, creating a mandated recurring revenue stream. A two-person crew with a smoke blower unit can test 1,500–3,000 linear feet of sewer per day at $0.25–$0.65/LF on municipal contracts.
Avg Revenue
$450K
Profit Margin
45%
Acquisition Multiple
2.5x - 4.5x
Startup Cost
$25K - $75K
How It Works
The operator bids on municipal sewer assessment contracts, typically issued by public works departments and wastewater utilities. Work is scheduled in segments, with prior notice sent to residents in the test area. A smoke blower unit injects harmless white smoke into the sewer main via an access manhole; the crew walks the right-of-way and documents every observation (smoke from roof vent = correct; smoke from yard = defect; smoke from storm drain = illicit connection). Reports are delivered digitally with GPS coordinates and photographs. Operators often expand into CCTV camera inspection, flow monitoring, and manhole assessment to increase per-contract revenue and lock in multi-year utility relationships.
Revenue Range
BizBite underwriting snapshot
Watch / verify
Sewer Smoke Testing Service has enough high-level data for a first look, but BizBite has not assigned a category-specific operating model yet. Treat the score as preliminary.
Category-level fit before lender-specific diligence.
Weak source data caps the final score.
Why it may work
- +Attractive 45% estimated margin profile
- +SBA dataset shows 119 recent comparable loans
Be careful
- !Source link status has not been verified yet
- !No last-checked date yet
- !No category operating model yet
- !No category model yet
Real Acquisitions in This Category
SBA 7(a) change-of-ownership loans · NAICS 541990 · All Other Professional, Scientific, and Technical Services
Deal Size Distribution
Deal Flow Over Time
Financing Profile
Recent Comparable Deals
| Closed | State | Loan | Implied deal |
|---|---|---|---|
| Mar 2026 | IN | $844K | $992K |
| Mar 2026 | CA | $524K | $617K |
| Mar 2026 | FL | $2.4M | $2.8M |
| Mar 2026 | AZ | $714K | $840K |
| Feb 2026 | FL | $150K | $177K |
| Feb 2026 | FL | $1.3M | $1.5M |
| Jan 2026 | UT | $154K | $181K |
| Jan 2026 | UT | $15K | $18K |
| Jan 2026 | FL | $580K | $682K |
| Jan 2026 | CA | $980K | $1.2M |
Source: SBA 7(a) FOIA dataset, filtered to acquisitions (loans where business age is "Change of Ownership"). Implied deal size assumes an 85% loan-to-purchase ratio, a common SBA change-of-ownership structure. Charge-off rate shown only when 10+ loans have resolved (paid in full or charged off). Interest rates reflect last 24 months only. Actual deal values vary with equity injections, seller financing, and working capital terms.
Pros
- +EPA-mandated compliance work makes this a non-discretionary budget item for utilities, not a discretionary project
- +Low equipment cost relative to contract value — a commercial smoke blower costs $4K–$12K and enables $200K+/year in contracts
- +Government contracts provide predictable multi-year revenue with clear renewal cycles
- +Expansion into CCTV inspection and flow monitoring multiplies revenue from the same client base
Cons
- -Municipal procurement is slow — 6–18 month sales cycles with formal bid processes and incumbent relationships to displace
- -Work requires proximity to project sites; hard to scale nationally without multiple regional crews
- -Public-facing work requires advance resident notification and occasional complaint management
Best For
Operators who understand municipal procurement and want a compliance-driven service business with government contract stability
Operating Costs
At $450K revenue: labor for field crew runs 30–35%, vehicle and equipment adds 10–12%, smoke fluid and supplies adds 3–5%, and bonding/insurance/overhead adds 8–10%. Net margins of 42–50% are achievable for owner-operators running a single crew. Second crew compresses margins to 30–38% until fully utilized.
SBA Financing Estimator
Adjust the deal — see if it cash flows after debt service
Estimates only. Excludes owner compensation, capex, working capital draws, and taxes. Margin assumes average occupancy and volume. Actual SBA terms vary by lender and borrower profile.
Where to Buy
Search for sewer inspection and utility services business listings
Industry association for pipeline assessment and sewer service contractors
Acquisition Score
Scores margin (30), entry multiple (25), SBA market depth (20), category risk (15), and deal momentum (10). Higher = better acquisition candidate.
Quick Facts
- Category
- service
- Difficulty
- 3/5
- Buy price
- $1.1M–$2.0M
Buyer's Toolkit
Essential tools to get started
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Largest business-for-sale marketplace in the US
SBA loans and business acquisition financing — get funded fast
ROBS financing — use retirement funds to buy a business tax-free
Bookkeeping for small business owners — hands-off financials
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