How to Find, Buy and Turn Around a Fixer-Upper BusinessHere's what you need to know if you plan on rehabbing an existing business.

After pocketing $500,000 at age 25 from several ventures, including St. Party's Day, the event-marketing brand he created and licensed, Bill Hennessey decided to buy "a sleepy brick-and-mortar business" in an industry that wasn't crowded with other business-school grads. That way, the Toronto 'trep believed, he'd have less competition.

In 2012 Hennessey began snatching up Canadian companies that manufacture industrial cleaning products, purchasing four for roughly $2.5 million in all and consolidating them into one uniform brand, Qwatro RoyalPak. He says most of the companies were stagnant, mismanaged or both. One was on the verge of bankruptcy. Another had no digital records to speak of—the previous owner maintained all data by hand. But all had one thing in common: a strong, loyal customer base.