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How do you determine the worth of your business?

Discussion in 'Bidding & Estimating' started by frikinfrozen, Sep 1, 2011.

  1. frikinfrozen

    frikinfrozen Junior Member
    Messages: 2

    I'm thinking of selling my snow plowing business. I have about 40 residential customers in the Minneapolis area and an older truck with a Meyer 7.5 ft poly plow with two pumps. How would I go about figuring the worth of my operation?
  2. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Accounts are worth nothing,who's going to pay for them when you can just go out and get some. Truck is worth a couple of bucks.
  3. swtiih

    swtiih PlowSite.com Addict
    Messages: 1,179

    Whatever someone is willing to pay. In my opinion if you got 10% of annual sales you shouldn't complain. If your not going to plow this year all these customers will just find someone else and you get nothing.
  4. SullivanSeptic

    SullivanSeptic PlowSite Veteran
    Messages: 3,422

    Any and all business' are worth whatever a buyer would pay. I have 2 good business' that turn a good proffit but none of my competition would buy mine because they would just let me close the doors and then snatch up my customer base. The trucks and machines are not worth anything because someone can just go buy the same stuff anywhere. I'm not saying equipment isn't worth money, just that my equipment specifically isn't worth anything special. So unless you have a major business that has a great foundation and can run without the owner being there everyday, your business isn't gonna be worth a lot to someone.
  5. ryde307

    ryde307 PlowSite Veteran
    Messages: 3,145

    I disagree. Buisnesses with contracts are worth something. Most dont want the equipment and the contracts together though. Yours in this case is small in the scale of snow business and not worth much is the problem. you could put it on craigslist and proabably get someone to buy it though. Many new people getting into it and looking for an instant customer base. What makes that worth money is signed contracts good records and showing you made ok money. We hve bought out 2 others one was good one was ok when all said and done.

    In terms of what its worth I would try something along the lines of 1 months revenue and whatever your truck is worth.
  6. wizardsr

    wizardsr PlowSite.com Addict
    Messages: 1,584

    You say Minneapolis area, but that's pretty general. Contracts in Plymouth would be worth something for example, while north Minneapolis, not so much. Within the city of Minneapolis is a pain too, as they enforce their curfew, with no exceptions for snow removal unless THEY declare a snow emergency. :dizzy: Every suburb we work in has enough common sense to allow plowing, snow blowing, etc within 24 hours of the snow ending, regardless of what time of day it is.

    If you're serious about selling your client list, let me know, I may be interested depending on where they're located. I'd have no use for your truck though.
  7. ryde307

    ryde307 PlowSite Veteran
    Messages: 3,145

    wizard if your interested we bought out another guy this spring and it came with around 30-40 driveways in minnetonka plymouth that I do not want. most are on the same roads in groups of 8-12 neighbors. The pricing on them was low and there is no contract but all the people need someone and I have the contact list and addresses. All are larger drives in nice neighborhoods.
  8. Reggie

    Reggie Junior Member
    from Indiana
    Messages: 10

    Curfew????? Are you serious????
  9. wizardsr

    wizardsr PlowSite.com Addict
    Messages: 1,584

    PM me a phone number and lets talk. Been thinking about expanding the driveway side of things, in the west metro, just need to figure out if it's worth paying another operator. Already have the equipment.

    Sure am. No plowing between 10pm and 6am unless the gods at city hall say so. :dizzy:
  10. Glenn Lawn Care

    Glenn Lawn Care Senior Member
    Messages: 552

    I don't think anyone is willing to buy residential snow plowing accounts since they are easy to come by. Sooooo nothing!!! :salute:
  11. wizardsr

    wizardsr PlowSite.com Addict
    Messages: 1,584

    Speak for yourself. They're worth what someone is willing to pay. IMO, marketing dollars are better spent on an existing list of clients than door hangers, yellow page ads, etc. Thumbs Up
  12. ryde307

    ryde307 PlowSite Veteran
    Messages: 3,145

    I would agree. Price is a major factor but if you can buy a list or a set of signed contracts it puts you much farther ahead than spending it on marketing to get similiar results at best. If I plow driveways for a great rate then yes many are easy to come by but for most without cutting costs to extreme lows lots of work is not easy to come by.
  13. snowguys

    snowguys Senior Member
    Messages: 708

    i kinda know a guy thats getting out of the biz and he was going to let the lots just go so i told him give me your contacts and numbers what you were charging and if i get the lots ill give him a kick back every snow falls works out both ways
  14. frikinfrozen

    frikinfrozen Junior Member
    Messages: 2

    Thanks for the input people. I guess it's like everything else, whatever the market will bear. Thanks again!