How do you price or appraise your business?

Discussion in 'Lawn Mowing' started by lantz, Mar 29, 2002.

  1. lantz

    lantz LawnSite Member
    Posts: 17

    How do you put a number on your business? What are the biggest factors that attribute to the appraisal and how are they measured? Anyone out there that has bought other lawn care services?
  2. tpl

    tpl LawnSite Member
    Posts: 67

    I never bought or took over anyones lawns or services. But, I had one purchased from me. Tru-Green Chemlawn/Tru-Green Plantscapes bought my entire business from me for 52 cents on the dollar for all yearly revenue I had coming in. Needless to say, I started a new business and I am not allowed to spray any of my lawns i.e. I can't put up any competition to Tru-Green.
  3. totallpm

    totallpm LawnSite Member
    from Utah
    Posts: 50

    Sold my fertilizing to a company for 50% of yearly revenue.

    Goodwill is hard to price, they are just names on a piece of paper. I believe the business is based upon relationships and that can be difficult to transfer to someone else.

    If your just starting doen't hurt to buy a small guy out to get started. Just remember there are no gaurantees.

    Build by doing quality work.

    Kevin Total Landscaping
  4. Ground Master

    Ground Master LawnSite Senior Member
    Posts: 505

    for a small mowing business:

    equipment- buy at value, i.e. price that each piece can be sold for
    customers- pay a percentage of sales for a year, i.e 10% to 20%
  5. Krimick

    Krimick LawnSite Member
    Posts: 86

    I've never bought a lawncare business before, but it's not something I would recommend.

    4 years ago, my boss sold his lawncare business for around 45k. The new guy was expanding his previous business and already had staff, so I was left without a job...s.o.l as the say

    So I had to start my own company, within 30 days I had taken back all residentials that I was cutting with my former boss, within 90 days I had taken back the contracts on all but 2 of the commercial properties we were taking care of.

    What I'm saying is be aware of your market, is your competition gonna swoop in and start picking up business before you can establish yourself.....contracts aren't worth the paper they're written on. They all have 30 day out clauses!

    If I were to sell my business, I would ask fair market value on all my equipment plus one months gross or about 10% of the previous years gross business.

    just my opinion.....
  6. bubble boy

    bubble boy LawnSite Bronze Member
    Posts: 1,020

    hey krimick where are you located?

    if its in toronto, i'm curious: what are the names of those companies...

    i guess a non compete clause didnt include you, does anyone know if you can include a company's employees in a non compete? i don't see why not, so i think it would be critical to include it.
  7. Krimick

    Krimick LawnSite Member
    Posts: 86

    I'm way north of T.O, although a few years back my cousin operated a landscaping company down there, not sure what the name of his company was though.

    I don't think you can include a companies employees in a non compete clause. Atleast not without each person signing the clause. And whoose going to sign anyting that they're not getting paid for?
  8. greensummer

    greensummer LawnSite Member
    from canada
    Posts: 93

    No judge in this world is gonna stop you from starting a business.

    There exists a jurisprudence on this matter. The only thing to be aware of is that you are taking customers away from your former employer. The burden of proof is upon your former employer to catch you in the act of stealing customers. This is very difficult indeed and expensive for both parties. But if your smart........;)

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