How much does a Commercial Ice Distribution cost to buy?

A typical Commercial Ice Distribution sells for 1.8x to 3x annual revenue. With average revenue of $650K, expect to pay $1.2M to $1.9M.

How much does it cost to start a Commercial Ice Distribution?

Startup costs range from $55K to $250K depending on location, equipment, and scale.

Route

/100 score

Strong

Commercial Ice Distribution

Q: What are the profit margins for a Commercial Ice Distribution?

The average profit margin for a Commercial Ice Distribution is around 24%. At $650K revenue: ice product cost or manufacturing 40–45%, refrigerated truck fuel and maintenance 12–15%, driver labor 15–18%, cold storage 3–5%. Owner-operator nets 22–30%.

Convenience stores, stadiums, and seafood markets all need ice delivered before sunrise. Nobody thinks about who does that.

Commercial ice distribution companies manufacture or purchase bagged and block ice in bulk and deliver it on route schedules to convenience stores, grocery chains, liquor stores, restaurants, seafood markets, fishing marinas, stadiums, and food service accounts. The business model is identical to a bread or beverage distribution route — fixed stops, recurring weekly deliveries, per-bag or per-ton pricing. Larger operators run their own ice manufacturing plants (tube or flake ice equipment); smaller operators buy from ice co-ops or wholesalers and focus exclusively on the distribution route. The product is non-discretionary, shelf-stable (in cold storage), and demand is weather-sensitive in a favorable way: hot summers spike volume 30–60% above baseline. A 2-truck operation with 80–120 accounts generates $350K–$700K with 20–28% net margins. Entry into a market typically happens through acquisition of an existing route book — ice distribution is a relationship business and cold-call customer acquisition is slow.

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Avg Revenue

$650K

Profit Margin

24%

Acquisition Multiple

1.8x - 3x

Startup Cost

$55K - $250K

Difficulty

3/5

How It Works

The operator loads a refrigerated truck at an ice plant or warehouse before 4–6 AM and delivers pre-set quantities to each stop. Convenience stores and grocery chains typically take 10–50 bags per delivery, 3–7 times per week, depending on volume and storage capacity. Billing is net-30 for commercial accounts and COD or weekly invoice for smaller stops. Manufacturing operators produce ice using industrial tube or flake ice machines (200–1,000 lb/day per unit) and store it in blast-freeze rooms before bagging. Routes are built around geographic density — tight routes of 20–40 stops within a 50-mile radius maximize truck utilization. Larger players serve regional grocery chains on contract; smaller operators dominate local convenience, marina, and food service accounts. Hot weather is a tailwind: summer demand routinely exceeds truck capacity, creating pricing power.

Revenue Range

Low End

$280K

Typical

$650K

High End

$2.2M

Pros

+Extremely predictable weekly demand — stores always need ice restocked, creating a reliable route schedule
+Hot weather spikes revenue 30–60% with zero additional marketing effort
+Low customer acquisition cost — accounts renew automatically when service is reliable
+Route density compounds margins: adding a new stop on an existing route costs near-zero marginal labor

Cons

-Refrigerated truck capital and maintenance is a significant operating cost
-Early morning start times (3–6 AM delivery windows) make owner-operator work physically demanding
-Commodity pricing pressure from large national suppliers like Reddy Ice creates margin compression in dense markets

Best For

Operators with logistics or distribution experience who want a route business with physical barriers to entry, recurring demand, and weather-driven revenue upside

Operating Costs

At $650K revenue: ice product cost or manufacturing 40–45%, refrigerated truck fuel and maintenance 12–15%, driver labor 15–18%, cold storage 3–5%. Owner-operator nets 22–30%.

SBA Financing Estimator

Adjust the deal — see if it cash flows after debt service

$-1747/mo

after debt service

Deal price — $1.4M

Range: $850K (1.8×) to $2.6M (3×+)

Down payment — 15% ($215K)

SBA minimum equity injection is 10% for change-of-ownership

Interest rate — 8.00%

Current prime-based SBA rates: 7.5–10.5%

Loan term — 10 years (120 mo)

Standard SBA 7(a): 10 years for business acquisition

Down payment

$215K

15% equity injection

Loan amount

$1.2M

85% SBA-financed

Monthly payment

$15K/mo

$554K total interest

Monthly profit

$13K/mo

at 24% margin

Monthly cash flow after debt service

$-1747/mo

Margin does not cover debt service at these terms. Lower the deal price, increase the down payment, or extend the loan term.

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.