Ballparking to find out what lawn Carecompany is worth

Discussion in 'Pesticide & Herbicide Application' started by grandview (2006), Apr 21, 2008.

  1. grandview (2006)

    grandview (2006) LawnSite Gold Member
    Posts: 3,466

    I may have an an opportunely to buy out the lawn care portion of the company I used to work for.The only equipment is a truck,last I heard there was about 700 accounts. I know different parts of the country have different pricing ,just trying to get a feel for what one account is worth.Company has been in business 25 yrs.
     
  2. RigglePLC

    RigglePLC LawnSite Fanatic
    Posts: 11,774

    Well-depends--rule of thumb is about 75 percent of annual sales.

    Or---about 4 times annual profit.

    I either case, add in the value of equipment separately.

    How are you going to finance the purchase? Can you pay 2000 a month for 4 years?
     
  3. garydale

    garydale LawnSite Senior Member
    Posts: 813

    The 75% rule is about right.
    Be sure non- compete is addressed, retention percentage is set and cancelations.
    Get agreement on the seller helping with the transition. ie: letters of introduction etc.
     
  4. grandview (2006)

    grandview (2006) LawnSite Gold Member
    Posts: 3,466

    Your just talking about 1 yr of profit correct ? Spread out over 4 yrs.
     
  5. humble1

    humble1 LawnSite Silver Member
    from MA
    Posts: 2,495

    80-100% around here, depends on how good they are.
     
  6. americanlawn

    americanlawn LawnSite Fanatic
    from midwest
    Posts: 5,842

    We we offered well over 90% of annual income years ago. No trucks, equipment, real estate.......just customer base. It all depends on how well the purchase benefits you in the long run.
     
  7. greenbaylawns

    greenbaylawns LawnSite Senior Member
    Posts: 563

  8. grandview (2006)

    grandview (2006) LawnSite Gold Member
    Posts: 3,466

  9. Tscape

    Tscape LawnSite Bronze Member
    Posts: 1,372

    Start at 100% around here. Before the economy started going backwards it was 125-150%. Who knows, now maybe 75% is good.
     

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