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Old 08-20-2012, 07:18 PM
Raymond S. Raymond S. is offline
LawnSite Senior Member
Join Date: Jun 2006
Location: Michigan
Posts: 962
I would expect 10%. Higher percentage for fewer accounts, lower percentage for more accounts. How many accounts does he have? We bought around 150 fert/squirt accounts, lost about 20 immediately when we sent out the prepays and merger letter but picked up about 15 or so in the next few weeks from existing website and "presence." This business had a strong presence in a specific part of town and good traffic on website, so there was more value than just what was on the books at time of purchase.
Don't overthink the process. Do your homework but remember this. You can lose more money avoiding losses. There are always intangible assets of a company to consider, such as "opportunity." Opportunity cost is different for everyone. If this deal would be the one to take you to the next level then you have to be willing to maybe spend a little more if that's what it takes. Only you can decide what's affordable for your company and if these type of accounts are where you want to be in the future.
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