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How to price small lawn biz?

Discussion in 'Lawn Mowing' started by BAMARED, Jul 31, 2004.

  1. BAMARED

    BAMARED LawnSite Member
    Messages: 206

    I have a small (14 customers) part time lawn care biz. that I'm considering selling. Could someone offer me some advice on how much $ to sell it for? I'm talking about: should I sell it for a certain % of the yearly income that it produces or ????

    I've had these customers for the last 5 seasons and most have become friends of mine. But due to "other" reasons, I've have been thinking of getting out of it next season. I just need a little guidance on how I should do it and what kind of $ to ask for it.

    Thanks,

    BAMARED
     
  2. AuburnGuy

    AuburnGuy LawnSite Senior Member
    Messages: 279

    Where are you in alabama?
     
  3. Precision

    Precision LawnSite Silver Member
    Messages: 2,995

    going rate in Florida is 3x monthly income as a top end price, plus equipment.
     
  4. eshreve1234

    eshreve1234 LawnSite Member
    Messages: 184

    Call local accountants and find one with a CVA. They are experts on valuing a business, sure it will cost some money but will tell you what its worth.
     
  5. grass-scapes

    grass-scapes LawnSite Bronze Member
    Messages: 1,552

    How can you put a value on the customers. someone could pay 3 x the monthly income, and the customers all drop you. I would suggest selling the equipment, and contracting with the new owner a percentage of your old clients income. IE if you get 300 a month, he would pay 30 percent for a few months unless they drop.
     
  6. BAMARED

    BAMARED LawnSite Member
    Messages: 206

    Precision,

    This is about what I was thinking. But I wonder what the "bottom" would be?

    Thanks,

    BAMARED
     
  7. Lakeside

    Lakeside LawnSite Member
    Messages: 24

    i just bought out a company. i wanted something that would cover me incase the clients dropped me. i payed 3.33% of the yearly revenue for each client up front. then, october 1, i'll pay 3.33% of the yearly income from all the remaining clients that i initially paid for. then march 1, i'll pay 3.33% again for all that renew...
     
  8. BAMARED

    BAMARED LawnSite Member
    Messages: 206

    Lakeside,

    Hum. That's interesting. I've never heard of doing it this way before.

    Thanks for you input,

    BAMARED
     
  9. Norm Al

    Norm Al LawnSite Bronze Member
    Messages: 1,227

    it is only worth what somebody is willing to pay for it! it would seem such a small business would be less valuable than a larger one!
     
  10. AuburnGuy

    AuburnGuy LawnSite Senior Member
    Messages: 279

    You still never said where you live in Alabama. I may be interested.
     

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