What Type of Business Should I Buy in Australia? The Industry Selection Scorecard
Choosing what type of business to buy in Australia is one of the most consequential decisions you'll make — and most buyers get it wrong by starting with what they know rather than what actually makes a good acquisition target. A business that's familiar isn't necessarily a business that's buyable, profitable, or transferable.
The right industry for you depends on a handful of factors that have nothing to do with what you're passionate about (sorry, not a self-help guide). They have to do with recurring revenue, owner dependency risk, how well the business runs without the original owner, and whether the skills required are ones you can hire for rather than provide yourself.
This scorecard helps you think through those factors systematically before you start looking at listings. The full framework below covers 10 of the most commonly transacted blue-collar industries in Australia, scored across 7 criteria, with guidance on how to weight the scores against your own situation.
For context: most of the industries covered here are the ones I see transacting in the $300K–$2M range — which is where the majority of Australian buyers in the $100K–$500K equity range are playing. This maps directly to Module 2 of the Playbook, where we go deeper on exactly what makes a business worth buying.
Why most buyers choose the wrong industry
The number one mistake I see is buyers defaulting to an industry they've worked in, on the assumption that familiarity equals safety. It doesn't. A plumber buying a plumbing business because "I know the industry" often ends up buying themselves a job — because the business is structured around someone doing the work, and that someone is now them.
The better question isn't "what do I know?" — it's "what can I manage?" You want to buy a business where the owner is a coordinator, not a tradesperson. Ideally, you want recurring revenue (contracts, service agreements, maintenance schedules) and a team that doesn't depend on any single person to function.
A broker told me last month about a buyer who'd spent 20 years in commercial HVAC and was dead-set on buying an HVAC business. He walked away from a cleaning business with $180K EBITDA and a management team because he "didn't know cleaning." Twelve months later he's still looking. The cleaning business sold in three weeks.
The 7 criteria that actually matter
Before you get to the scored table, here's what each criterion means and why it's on the scorecard:
1. Recurring revenue potential — Does the industry naturally produce repeat customers, maintenance contracts, or service agreements? Higher is better for stability and for resale value.
2. Owner dependency risk — How easy is it for the business to run without a highly-skilled owner involved in daily operations? Lower dependency is better.
3. Licensing complexity — How hard is it to transfer or hold the required licences as a buyer who may not be a tradesperson? High complexity creates transition risk.
4. Capital intensity — How much does the business need to spend on equipment and vehicles? Higher capital intensity means more of your purchase price goes to hard assets, which can be good or bad depending on your financing structure.
5. Competition intensity — How crowded is the industry in most Australian metro markets? Higher competition makes it harder to hold margins and price at acquisition.
6. AI/automation potential — How much of the business's admin, quoting, scheduling, and follow-up can be systematised with current AI tools? This is a meaningful value-creation lever for buyers willing to use it.
7. Skill transferability — How quickly can a non-tradesperson owner get up to speed on what the business actually does, well enough to manage it? This matters more than most buyers think.
You can combine these criteria into a weighted score based on your own priorities. The full framework (below) includes a scoring table for 10 industries, plus a personal weighting worksheet to help you identify which criteria matter most given your background, risk tolerance, and timeline.
For more on assessing owner dependency specifically, the Owner Dependency Scorecard is a companion resource that drills into a single business rather than comparing across industries. And if you want to see how the numbers stack up once you've picked an industry, the industry multiples cheat sheet gives you the EBITDA multiple ranges you're likely to pay.
More detail on what makes a business worth buying — including recurring revenue, market position, and growth vs. stability trade-offs — is in the guide how to find a profitable small business to buy in Australia. And for a broader view of the best type of business to buy in Australia, that article covers the strategic picture before you get into the scoring detail here.
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