What's It Worth?.........hb

heatboy

put a value on a contracting business if you would like to sell it? Or, for that matter, if you want to buy an existing business.

hb

kevin coppinger_4

thats a good Q...

uestion...I have no clue. Although I just talked with someone who sold a SMALL cleaning biz for 10K. That was just the customer list, in so. NH.I suppose one would have to look at how much $ such a list of people would bring into a co. in a yr... kpc

To Learn More About This Professional, Click Here to Visit Their Ad in "Find A Professional"

hr

hb

Give Ellen a call. She has been involved in a bunch of these deals. Some pretty creative ones where both buyer and seller can assure it works smoothly and profitably.

Stuff is easy to put a number on! Good will, phone book placement, number of calls, quality of calls, etc gets tricky. Hopefully the company has kept real tight numbers, and books, to get a handle on it's health

hot rod

To Learn More About This Professional, Click Here to Visit Their Ad in "Find A Professional"

Constantin

Several ways to do this...

... first of all, are there comparables? This is a favorite of the Wall street boys who don't like to think too much... simply take net earnings, multiply it by the average P/E ratio for that industrial sector and be done with it.

However, are there any comparable HVAC-installer businesses that are traded OTC or on the big boards? One fly in the ointment is that private businesses are typically valued at 30% less than a comparable public corporation because of the lack of liquidity.

Dale

Specialists

There are companies who specialize in this, put a value on "good will" reputation ect. If I were thinking of selling I would get this done a few years ahead of time to get the measurables as good as possible. A large bank or commercial insurance company should be able to give you a local list.

Tom_35

valuing business

Contracting Business magazine just had a large article on this subject.

You should be able to get a copy that will give you a starting point.

Tom

Weezbo

H B ,Trust but Verify *~/:)

i would visit the general contractor that he works with and see if you would even want to work with him make sure the quality of work wont have you doing three times the normal work load fixing things that arent supposed to be broken,if it was a service contracting business,working "with" him a couple months or offer to work with him a few weeks to meet the wholesale houses he uses and the businesses he works with,if the guys in some sort of Big Hurry then maybe you dont want to buy into it at all.

bb_3

values

HB:

Find a Pro that knows how to do this. For an off the cuff guess, look @ Inc. Magazine. They publish average sale prices for many catagories of business. If I remember correctly the average plumbing business goes for about $750,000 but I can't remember the average revenue number that goes with this....

Hope it's a help.

bb

Einsiedler_2

protect future interests

Make sure its written in that he stays out of the same business for a period of time (say 5-10 Yrs).

otherwise you may buy his current business only to lose the customer base when he starts up a new business down the street!

If you remember the Brothers that built Raypak boilers years ago, sold the company, then had to wait a period of time before they could start up again (CAMUS)

good luck!
EIN