I'm looking into buying another company and was wondering if there is any one out there who has, or has looked into buying another company who would have any advice for me. The other company does about 200K in sales per year. I figure that their equipment is worth 30-40K. My accountant looked into valuing a lawn maintenance company and came up with these rules of thumb. 1. 50 60 percent of annual sales plus inventory/equipment 2. 1.5 times SDE plus inventory (SDE is (sellers discretionary earnings) calculated as net income before primary owners compensation, other discretionary, nonoperating, or nonrecurring income or expenses, depreciation, interest and taxes.) Does this sound reasonable to you? If we went for the first rule the company should be worth 130K-160K. That seems a little high to me but it is in line with what he is asking for his company. He has mostly commercial accounts. For the most part the contracts aren't going to bind his customers to me if I buy the company. We both offer good quality services that aren't the cheapest in town and so I think that most of his clients should feel that they are getting the same or better quality services from my company and hopefully stay with me. He is also willing to have a transitional period where he will work with my company so he will still work with his clients so they should get to know my company while they still work with him. How would you place a value to his company? Any thoughts would be appreciated.