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  #31  
Old 08-24-2014, 07:52 PM
ajreeves ajreeves is offline
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Originally Posted by LawnsharkMB View Post
I don't understand what he would be paying you for?

If you are looking to expand and make more money by taking on this guy's accounts under your business name, shouldn't you be buying out his equipment and basically hiring him to work for you?
He'd be paying me bc I have a larger business and by merging his revenue and profit would increase
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  #32  
Old 08-24-2014, 10:44 PM
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Efficiency Efficiency is offline
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Originally Posted by ajreeves View Post
and by merging his revenue and profit would increase
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For his to increase, yours would have to decrease. Why would you sell equity in your business? If you a hell bent on doing this, take him on as a minority partner so that he has no say in decisions. It won't go well for either of you but at least you can still call the shots.
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  #33  
Old 08-24-2014, 11:22 PM
ajreeves ajreeves is offline
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Originally Posted by Efficiency View Post
For his to increase, yours would have to decrease. Why would you sell equity in your business? If you a hell bent on doing this, take him on as a minority partner so that he has no say in decisions. It won't go well for either of you but at least you can still call the shots.
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I really appreciate your insight. And I do understand your point. For some reason I am still tempted but leaning towards passing on the offer. Thanks to all who took the time to respond.
However, my original question remains unanswered, how do you value a lawn care biz? Is there a certain formula or method to determining that figure?
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  #34  
Old 08-24-2014, 11:23 PM
ajreeves ajreeves is offline
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Originally Posted by CNYScapes View Post
Does he really have $100k cash to give you? I would be shocked if he did.

I tried the partner thing many years ago. Forget about making decision on your own anymore.

Heres an example of decisions you will not be able to make on your own anymore-

Hey "Bob", what do you think about buying a new zero turn to replace this old one? Bob Says- Why not run the old one until it dies?

What do you do then? Compromising SUCKS!
He'd pay the 100k over two yrs more than likely.
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  #35  
Old 08-24-2014, 11:40 PM
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wbw wbw is online now
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Originally Posted by ajreeves View Post
I really appreciate your insight. And I do understand your point. For some reason I am still tempted but leaning towards passing on the offer. Thanks to all who took the time to respond.
However, my original question remains unanswered, how do you value a lawn care biz? Is there a certain formula or method to determining that figure?
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Typical small business is worth 2- 2 1/2 times benefit to owner.
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  #36  
Old 08-25-2014, 08:47 AM
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McFarland_Lawn_Care McFarland_Lawn_Care is offline
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Typical small business is worth 2- 2 1/2 times benefit to owner.
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PLUS business current net worth.

Last edited by McFarland_Lawn_Care; 08-25-2014 at 08:53 AM.
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  #37  
Old 08-25-2014, 05:49 PM
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PROCUT1 PROCUT1 is offline
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The first thing you need to do is have a real accounting done of your numbers.

Unless you found a way to charge 4 to 5 times what everyone else does for the same service or job, there is no way that your numbers posted are even remotely accurate.

Dont interpret this as I'm accusing you of BS. I'm not.
I just think that you're not versed on the accounting terms.
Your friends neither.

Understand what youre saying is.....If you went to work this year, paid all of your bills, all of your payroll, all of your material, all of your expenses.....At the end of the year you would have half of your total invoices in the bank.
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  #38  
Old 08-25-2014, 06:56 PM
ajreeves ajreeves is offline
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Originally Posted by PROCUT1 View Post
The first thing you need to do is have a real accounting done of your numbers.

Unless you found a way to charge 4 to 5 times what everyone else does for the same service or job, there is no way that your numbers posted are even remotely accurate.

Dont interpret this as I'm accusing you of BS. I'm not.
I just think that you're not versed on the accounting terms.
Your friends neither.

Understand what youre saying is.....If you went to work this year, paid all of your bills, all of your payroll, all of your material, all of your expenses.....At the end of the year you would have half of your total invoices in the bank.
Well I understand the skepticism but first trimester my biz profited 80k, 2nd Tri I profited roughly 60k and I am projecting the third quarter just under 50k. Now one thing to understand is that around 30k of this is pure profit from subcontracting work where I have no expenses. Also, this does not include any salary for myself and lastly I try to carry very few loans. I understand what you are saying though, I am sure I am off somehow or somewhere with my formula but the first two trimesters are fact. I do think that my revenue might be a but higher than I originally projected though. I do try to charge a premium for my services but def not 4-5 times higher. We do a lot of higher margin work(hardscapes).
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  #39  
Old 08-27-2014, 03:38 PM
GaryBK GaryBK is offline
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Originally Posted by McFarland_Lawn_Care View Post
PLUS business current net worth.
Does that include goodwill?
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  #40  
Old 08-27-2014, 03:41 PM
GaryBK GaryBK is offline
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Originally Posted by ajreeves View Post
Well I understand the skepticism but first trimester my biz profited 80k, 2nd Tri I profited roughly 60k and I am projecting the third quarter just under 50k. Now one thing to understand is that around 30k of this is pure profit from subcontracting work where I have no expenses. Also, this does not include any salary for myself and lastly I try to carry very few loans. I understand what you are saying though, I am sure I am off somehow or somewhere with my formula but the first two trimesters are fact. I do think that my revenue might be a but higher than I originally projected though. I do try to charge a premium for my services but def not 4-5 times higher. We do a lot of higher margin work(hardscapes).
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Why are you accounting on trimesters? Most of us use quarterly and monthly reports. (when we are not crazy busy and get behind. Lol)
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