The Preacher
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- 3,401
who here has bought or sold a biz that was an O/O???
what formula did you use???
what formula did you use???
How would you value the sell of your O/O business
- Thread starter The Preacher
- Start date
KevinD
Member
In my opinion a O/O would be the business so, I could not value it much over value of equipment.
bob vawter
Grassy Knoller
It would depend on several factors....one if the Owner would go out wit the buyer for a specified amount of time...
and two, how loyal the customer base was to the company!
and two, how loyal the customer base was to the company!
Jim Martin
Supportive Member
equipment value is easy..................
but it may be worth more to the owner then its true value
The client list .. you have to be careful with you may end up buying air before it is over with. This is a lot easier if both the seller and the buyer have the same pricing structure and cleaning habits.....
When buying a client list ..buy each client individually..
when the sellers client calls you go out and do the cleaning.......the seller gets a certain percentage of that cleaning and from that point on the client is yours.........Once the client is yours.....if they like/don't like you........call you back or don't call you back......it is your problem not the sellers.he/she lost all ties to that client......
the percentage should be based on the amount of the job.
if it is just a minimum call out then it would be a lower percentage then if it were a huge job.......If it is a new client then I would give a small referral fee for the first year......
but it may be worth more to the owner then its true value
The client list .. you have to be careful with you may end up buying air before it is over with. This is a lot easier if both the seller and the buyer have the same pricing structure and cleaning habits.....
When buying a client list ..buy each client individually..
when the sellers client calls you go out and do the cleaning.......the seller gets a certain percentage of that cleaning and from that point on the client is yours.........Once the client is yours.....if they like/don't like you........call you back or don't call you back......it is your problem not the sellers.he/she lost all ties to that client......
the percentage should be based on the amount of the job.
if it is just a minimum call out then it would be a lower percentage then if it were a huge job.......If it is a new client then I would give a small referral fee for the first year......
Steve in Omaha
Member
Could be a big short cut to the top if you know what you are doing, or are a very fast learner. Getting the door opened at the top could be more that worth 4 years of present day university training.
As an owner operator your business is worth what your equipment is worth and very little more.
This is why it is so silly to NOT build your business into a turn key type of business that REALLY has some value.
I know of MORE than a few guys that sold their o/o businesses and were stunned to find out they were not worth nearly what they thought.
The client list is of little value. When an owner operator is doing the work they are hiring YOU. When you sell that business now they are dealing with someone completely different.
There is no guarantee the clients will stick with you.
Of course is the company has existing contracts with commercial accounts and the new owner can get those contracts transferred to his name then that client list is more valuable.
Otherwise, ad up the value of your equipment and that is about what you can get...unless you run into someone really stupid.
DevilDog
This is why it is so silly to NOT build your business into a turn key type of business that REALLY has some value.
I know of MORE than a few guys that sold their o/o businesses and were stunned to find out they were not worth nearly what they thought.
The client list is of little value. When an owner operator is doing the work they are hiring YOU. When you sell that business now they are dealing with someone completely different.
There is no guarantee the clients will stick with you.
Of course is the company has existing contracts with commercial accounts and the new owner can get those contracts transferred to his name then that client list is more valuable.
Otherwise, ad up the value of your equipment and that is about what you can get...unless you run into someone really stupid.
DevilDog
KevinL
Supportive Member
except to point out to Todd the post above his on the right way to show value for your o/o business and get it sold. Great post. To bad Todd doesn't hear what others say.
Mikey P
Administrator
Let say I were to make an offer a charismatic, well spoken, hard working, honest and dare I say it, white guy, who already owns a CC biz, the chance to buy my client list.
After a month or less of training and introductions to key referral sources and bigger clients, what would a list worth over 300 a year go for?
No WD, only a hand full of after hours crap. he himself would have to be present on about 1/4th of the jobs to keep em happy. The rest could be chimped.
After a month or less of training and introductions to key referral sources and bigger clients, what would a list worth over 300 a year go for?
No WD, only a hand full of after hours crap. he himself would have to be present on about 1/4th of the jobs to keep em happy. The rest could be chimped.
Steve Toburen
Supportive Member
- Joined
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- Steve Toburen
Mike,
If you look at page 36 in my Special Report "Cleaning Up: Building Personal Wealth in the Cleaning Industry" you will see a sheet titled "An Initial Business Valuation Worksheet". Fill in the blanks (read the preceding chapter on how to arrive at the numbers first) and presto- you at least have a starting point. (This work sheet works for both o/o firms and multi-truck companies.)
I think I have e-mailed you this Report before, Mike, but if not just drop me a line at stoburen@homefrontsuccess.com and I'll e-mail you the Report. (Offer good for anybody and include your mailing address if you want the free companion DVD.)
Say hi to Paula for me and tell her I want to know how her SFS Action Plan is coming! (Looking at how much time you spend here I already know what has happened to your Action Plan!)
Steve Toburen CR
Director of Training
Jon-Don's Strategies for Success
PS For those of you that want a little more personal attention the valuing of your business is one of the topics I will cover at our "Secrets to Building Your Business to Retire Wealthy" conference January 11 and 12 in Houston TX. Here is the link- http://www.bnpevents.com/ICS/SBYB/
A longstanding and profitable O/O does have value. How much? It is all based on the numbers which can be calculated using the IBV worksheet. Or we can all keep bickering over a theoretical price on a theoretical business ... (This kind of reminds me of how Sioux and I will drift into a major fight while we are out walking over how we would remodel a house that we are passing by that we will never own!)
If you look at page 36 in my Special Report "Cleaning Up: Building Personal Wealth in the Cleaning Industry" you will see a sheet titled "An Initial Business Valuation Worksheet". Fill in the blanks (read the preceding chapter on how to arrive at the numbers first) and presto- you at least have a starting point. (This work sheet works for both o/o firms and multi-truck companies.)
I think I have e-mailed you this Report before, Mike, but if not just drop me a line at stoburen@homefrontsuccess.com and I'll e-mail you the Report. (Offer good for anybody and include your mailing address if you want the free companion DVD.)
Say hi to Paula for me and tell her I want to know how her SFS Action Plan is coming! (Looking at how much time you spend here I already know what has happened to your Action Plan!)
Steve Toburen CR
Director of Training
Jon-Don's Strategies for Success
PS For those of you that want a little more personal attention the valuing of your business is one of the topics I will cover at our "Secrets to Building Your Business to Retire Wealthy" conference January 11 and 12 in Houston TX. Here is the link- http://www.bnpevents.com/ICS/SBYB/
A longstanding and profitable O/O does have value. How much? It is all based on the numbers which can be calculated using the IBV worksheet. Or we can all keep bickering over a theoretical price on a theoretical business ... (This kind of reminds me of how Sioux and I will drift into a major fight while we are out walking over how we would remodel a house that we are passing by that we will never own!)
