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  #1  
Old 08-18-2014, 07:20 PM
ajreeves ajreeves is offline
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Join Date: Oct 2013
Posts: 31
How do I determine the value of my lawncare business?

Hey guys
I could use a little help with this.... Here's the situation.
A friend and long time subcontractor has made me an offer to buy into my company.

My numbers:
In biz 7yrs
Last yr Revenue 200k, net operating profit of 95k
This year projected revenue 390k projected net operating profit- 187k.
Equipment value - 180k
Loans- 56k

His numbers:
In biz 4 yrs
Last yr rev 100k, net operating 50k
This yr proj rev 150k, net operating 75k
Equipment value 120k
Loans 63k

Any advice on how I would determine what his buy in cost should be? We both offer similar services but he does not plow and I do.
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  #2  
Old 08-18-2014, 07:20 PM
ajreeves ajreeves is offline
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We offer everything from mowing to hardscapes, no pesticides and no irrigation.
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Old 08-18-2014, 07:27 PM
whiffyspark whiffyspark is online now
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Location: Chesapeake beach
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Too small to have a partner.
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Old 08-18-2014, 07:32 PM
ajreeves ajreeves is offline
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Care to elaborate?
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Old 08-18-2014, 09:41 PM
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Snyder's Lawn Inc Snyder's Lawn Inc is offline
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Location: Kirksville Mo
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If you making those number why would you want a partner to deal with
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  #6  
Old 08-18-2014, 09:55 PM
ajreeves ajreeves is offline
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Quote:
Originally Posted by Snyder's Lawn Inc View Post
If you making those number why would you want a partner to deal with
To increase my time with family, the ability to go out of town and have someone who has a vested interest in keeping the business running smooth. But most of all I think that it raises the ceiling on how big my business can be. I was hoping to open other parts of the business like a fert/ pesticide division. Which I would need a few specialized courses.
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Old 08-18-2014, 11:17 PM
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Snyder's Lawn Inc Snyder's Lawn Inc is offline
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Location: Kirksville Mo
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Quote:
Originally Posted by ajreeves View Post
To increase my time with family, the ability to go out of town and have someone who has a vested interest in keeping the business running smooth. But most of all I think that it raises the ceiling on how big my business can be. I was hoping to open other parts of the business like a fert/ pesticide division. Which I would need a few specialized courses.
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How many employees you have now

Family time is nice
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  #8  
Old 08-18-2014, 09:44 PM
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Efficiency Efficiency is offline
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Join Date: Apr 2011
Location: zone 6
Posts: 1,077
Quote:
Originally Posted by ajreeves View Post
Hey guys
I could use a little help with this.... Here's the situation.
A friend and long time subcontractor has made me an offer to buy into my company.

My numbers:
In biz 7yrs
Last yr Revenue 200k, net operating profit of 95k
This year projected revenue 390k projected net operating profit- 187k.
Equipment value - 180k
Loans- 56k

His numbers:
In biz 4 yrs
Last yr rev 100k, net operating 50k
This yr proj rev 150k, net operating 75k
Equipment value 120k
Loans 63k

Any advice on how I would determine what his buy in cost should be? We both offer similar services but he does not plow and I do.
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heck, id buy in if your profit numbers were legit
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  #9  
Old 08-18-2014, 11:24 PM
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TPendagast TPendagast is offline
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Location: Wasilla, AK
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Quote:
Originally Posted by Efficiency View Post
heck, id buy in if your profit numbers were legit
This is what I was thinking… is that "net" before owners salary?

Im somehow doubting the correctness of the ratio of numbers.
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  #10  
Old 08-18-2014, 11:29 PM
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TPendagast TPendagast is offline
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Join Date: May 2008
Location: Wasilla, AK
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I do not think "partners" in anyway dictate, or open doors to size.

In many cases they add a variable that can limit them.

I would strongly advise against any partnership.

Key people, and good salaries and possibly motivation through profit sharing create a situation where you can get more family time, and learn to give long time employees more reign to help grow.

However, if an employee misuses or abuses that trust, they can be stopped/replaced.
Not so easy when a partner does what you don't want them to.
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