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Selling snow plowing company

Discussion in 'Used Plowing and Truck Equipment Forum' started by Trim, Dec 16, 2012.

  1. Trim

    Trim Junior Member
    from Midwest
    Messages: 8

    I am interested in selling my snow plow company I have the value of equipment but not sure what I can get for my contracts. I have a few seasonal accounts that adds up to $14k per season I have the rest of the accounts on a per push each plow/salt event bills out $2475 and each salting only event bills out $1225

    My route takes 2 trucks 5-6 hours to do if we get a average season (18 plowings & 30 saltings) I should gross out at 80k would it be fair to ask $25k for the contracts?
     
  2. MR. Elite

    MR. Elite Senior Member
    from E Town
    Messages: 549

    Why r u looking 2 sell?? Where in midwest? Wat kind of equip? Wat kind of accounts? How large of a service area?
    There r many factors that play in2 the roll of selling a biz...
     
  3. leolkfrm

    leolkfrm PlowSite.com Addict
    Messages: 1,432

    only if you are ready to garuntee the income....do the contracts need to be honered by customers if a new owner?
     
  4. ryde307

    ryde307 PlowSite Veteran
    Messages: 3,143

    Where are you located? Are they long term customers? What equip? Commercial or Residential?
     
  5. IDST

    IDST Senior Member
    Messages: 938

    why are you selling??
     
  6. plowking35

    plowking35 2000 Club Member
    from SE CT
    Messages: 2,923

    1 yr gross of a 3 yr average of income.
    However contracts will need to be signed through the next three years going forward.
    Or you can negotiate a monthly payment during the season off gross revenues of accounts sold.
    You will need a good attn and accountant to make this all flow easily.
    Odds are it will be easier to sell equipment separate from accounts.
    Contact another service provider that you have a good working relationship with to see if they are interested in purchasing the accounts. Be carefull once news gets out that you are selling, your customer base may evaporate then leave you with nothing of value.
    Start with your accountact
    Good luck.
     
  7. fireside

    fireside Senior Member
    Messages: 661

    my thoughts are the accounts are worth nothing. Most times i have found that once the words out that your for sale most accounts will not sign with the company that bought you out. Even if they are long term contracts they will not have to be honered by the company for service. The equipment has value so sell it as a package deal.
     
  8. merrimacmill

    merrimacmill PlowSite.com Addict
    from MA
    Messages: 1,822

    Its tough to sell a company like that for more than the value of the equipment. With that few customers, most likely many of them will not follow through with the transfer of ownership, and even if they do this season, I'd be willing to bet most will be out to bid next year. Even if they're multi-year, its still tough.

    Generally with a biz of this size, your customers have hired you not your company. By that I mean that if you don't show up to work, nothing happens. The company doesn't sound like it is self sustaining entity that runs without you, or has a very powerful brand name behind it to purchase.

    If you had people for every task, accounts who have never even met you or even know your name, an established brand that people know, and operational procedures and systems that run the entire company from A-Z, all written down into manual books, THEN you would have a company to sell. I'm talking about a self sustaining money machine that the new owner wouldn't need to get too involved with..

    I'm not there, and have never sold a company. But so often guys ask me if I want to buy them out, and when I look into it there is nothing to buy but the hope and prayer that the accounts will go to the new ownership, and some used equipment.. I'll ask "what about your contracts?" and more times than not, they just say "oohh, I don't need them. Its just verbal" which says yes, there is literally nothing to sell.

    This is not to say that any of this even applied to your Co as I have no idea what your company is like, I'm just tossing out what I have seen and learned over the years. In a situation like a mentioned above, its likely the customers would never even know the company changed hands...
     
    Last edited: Dec 16, 2012
  9. Snow Picasso

    Snow Picasso Senior Member
    Messages: 249

    Your contracts would have no value unless you can guarantee they will all stay with the new owner. If they are 1 year contracts just forget about trying to sell them! Work something out for your equipt and possibly work a percentage for contract renewals with your buyer.
     
  10. snoproblem

    snoproblem Junior Member
    Messages: 12

    Where in the mid-west?
     
  11. Eronningen

    Eronningen Senior Member
    Messages: 442

    Equipment worth something but your name and contracts worth virtually nothing.
     
  12. Trim

    Trim Junior Member
    from Midwest
    Messages: 8

    I'm located in Milwaukee, WI
     
  13. Trim

    Trim Junior Member
    from Midwest
    Messages: 8

    I work full time for the County where I live the company was started small and then grew larger over time and now I have no time for anything else so I'm ready to sell and focus on my family and having only 1 job.
    I have mostly commercial accounts with a few houses along the route. most of the accounts are mine and a few are with a national company. I keep hearing both side of the coin about contracts have no value and some people say they do. I guess I'll just list it and see what offers come in.
     
  14. ponyboy

    ponyboy Senior Member
    Messages: 957

    I disagree if you sell the name and phone number and other driver stays you could sell
    It should not matter who ownes company
    Price it is regional get what you can
     
  15. kuhndogg

    kuhndogg Junior Member
    Messages: 12

    I'm interested. Located in Slinger, WI. You can pm me the details. Thanks
     
  16. blowerman

    blowerman PlowSite.com Addict
    Messages: 1,262

    Accounts have value... I just acquired a companies portfolio last month. Will some customers leave? I'm sure some might, but for the right price, it can be a win, win, win for all parties.
    Typically the seller frees himself of the burden, the buyer obtains additional accounts, the end user gets a transition free service without needing to shop around again.

    BTW, I'd be interested in discussing the matter if you'd like... Do you still have my contact info? (The mulch blowing trucks)
     
  17. snowprice

    snowprice Junior Member
    from chicago
    Messages: 19

    accounts always have value we built our whole company on aquirring accounts.

    any body wanting to sell in the chicago area we would listen
     
  18. Trim

    Trim Junior Member
    from Midwest
    Messages: 8

    Thanks for the info, blowerman I'll call you cell and leave you a message if you don't answer
    kuhndogg I sent you a message
     
  19. suzuki0702

    suzuki0702 Senior Member
    Messages: 649

    cant sell customers...
     
  20. mcwlandscaping

    mcwlandscaping 2000 Club Member
    Messages: 2,557

    That scenario should ultimately be the goal of any business owner if they want their business to have marketable value. Its difficult especially given many of the mistakes that most people make in business completely oppose steps towards making it happen!