Does my business have a value can it be sold??

Gehngus

Hi.

I'm self employed and deal in building maintenance, renovations & repairs. On larger projects I get specialists in that I trust and overseas as well as work.

Over the years I have built up a good client list based on trust, good work and word of mouth.

I have never advertised. I belive if you do a good job, priced fairly, turn up when you say you will word gets around.

So every one of my customers is via recommendation and word of mouth.

Many consider me a friend and have the kettle on if I pop by to say hello.

Its a job I enjoy for all the right reasons.

But I'm getting older and will look to retire soon.
I am already slowly swapping work time into family time and 2.5 days a week is a good ballance. I just stopped doing the heavy work.

I earn a decent annual salary for my area working two and a half days per week (apox 25k pa)
I could have more work but have to politely decline and apologies to others as I'm usually booked up to two months in advance.

This is mainly normal people work but also work for some businesses.

I don't have contracts with them. I work well and I'm asked back.

I am afterall a business man so would like to know if this business could be passed onto the right person for a cost.

There are also tools, supplies & scaffold. Approximately two garages worth but these I'm not too concerned about as I would give them to the person who would take good care of my clients.

It would like mean my escorting me to learn or my escorting them to see how they work, assisting or training that person and introducing them to all my clients.

Many jobs I do are to people who have had the job done badly and it needs re-doing. What I dont want is for my customers to end up back where they started.

There are some new younger guys coming onto the field that are trying to gain business and they might be interested in an instant clientele list, if they are up to the task.
Having designed and built house solo from foundation to roof I do have a very broad skillset so this isnt something to pass to a basic diy'er handyman.

I also want somebody my customers can trust and rely on so the business wouldn't be sold to anybody. They would have to be aprobed of if you will.

So the question is. Is it a business with value? Somebody putting money in would most likely take it seriously.

If so I might retire earlier.

Or is this not the type of thing one can sell so I just wind it down or hang my hat up?

All comments welcome.
Thanks in advance

Grumpy_chap

https://forums.moneysavingexpert.com/discussion/6657715/does-my-business-have-a-value-can-it-be-sold

How much of a business is there if you come out of the business?

It sounds like not a lot.

Gehngus

Ah. Yes this is true if I am the business.

My brother sold his window cleaning round which I see may be different because it is a round? A collection of addresses and names I think he sold? Basically the round sold for five times his average monthly turn over.

No introductions of course, just faith that the next guy knew what to do.

I suppose this is what got me thinking.

I do have a lot of regulars. People who want their houses maintained in the way some want their gardens maintaining.

Paint, fense, Gutters, build a shed, fix the roof, point the chimney, replace the fascias, new bathroom kitchen.. paint it all again its been on for five years. Check the roof again, bad storm last night.

houses take a lot of looking after and many simply dont want to do not them selves.

Gehngus

https://forums.moneysavingexpert.com/discussion/comment/81906771#Comment_81906771

This is the question exactly.

The business is there with or without me.

It arrives with every storm, leak, spring time.

The hard bit is to be chosen to do the job.

My phone does that for me. It rings because people want the work doing and want me to do it. I can then pass that work on or introduce the new guy.

There are jobs where I get others to work and I charge a fee to advise, arrange and check the work so this might be an avenue? The guys I ask always appreciate being given the work. I choose who does it.

Maybe that's an avenue? Paid introduction?

Just playing with ideas for now.

caprikid1

If you want to sell it you probably need to take someone on for 18 months - 24 months and work more days, with a view to selling it to them, supervise , let them do more of the heavy work etc. Even still no guarantee.

But there is not much value here unless you can segment some of it out IE 100 Lawns to mow etc.

Grumpy_chap

It rather seems to me as though the OP's biggest personal strength, which is mentioned as "a good client list based on trust, good work and word of mouth" and the fact that the customers "consider me a friend and have the kettle on if I pop by to say hello" is a weakness for selling the business.

The business is too closely tied to the identity of the OP to survive as a business without the OP.

HampshireH

If I were a customer who used you based on reputation, I'd be fuming if you just sold on my details.

From what you have said though it doesn't sound viable. If you have other tradespersons you rely on for big work then field customers their way & sell your kit. Or you need to grow your business and have more formal contractual arrangements in place making it an attractive prospect. But no commercial business is going to want to put long term/high value contracts in place with someone winding down as the risk is too high.

Without wishing to devalue what you offer, there are plenty of you out there working full time, with good reputations, with and without contracts in place. Your customers have plenty of options if you wound it up.

Emmia

I think this only has potential value if you employ someone with a view of selling/transferring the business to them - but that probably means you doing more hours as you'll need to be more present to introduce them to clients, and ensure they're up to your standards.

I knew someone who took over a training business in this way, eventually buying the previous owner out, but I think the time between their joining, and the buyout was probably approaching a decade - I'm not sure that's the kind of timeframe you're thinking of OP.

MyRealNameToo

Are you self employed or have you incorporated?

What are you offering in the sale? Your telephone number and email address?

The fact the business is really just you and you have no ongoing contracts isnt going to help you. A friend is in a similar position, he wins most his business because he is well known but in his case he has offices, a dozen staff and various contracts with years left to run on them. He has found people willing to buy but he hasn't managed to agree terms… the highest bidder wants him to stay on 5 years and will only get the last 50% of the price if the profits are still at the right level.

Your contact details are probably the most valuable aspect so when someone calls the buyer answers. It's not going to be vastly valuable. Assuming you dont want to give up these you could instead have an agreement that you recommend someone else but were I to enter into that sort of agreement I'd want to pay based on a fee per job won as a result of the recommendation rather than a fixed fee or a per referral fee.

Gehngus

Thanks for all your answers.

Yes it does sound difficult or complicated.

I have couple of years to decide.

It looks like I need to find somebody I can trust to recommend to my customers.

I can introduce the new guys to each customer if nescesary or let the new people have my work number when I pack up.

I have around 20k in tools and stock which I could offer to them but I would expect them to have decent tools already.

I also own a garage for storage to sell or let out.

MyRealNameToo

Realise you are a probably a fairly small business without too much expectations but these things often take longer than you think and some buyers will want you to stay on for a while post sale. It's too late to start the process a few months before your desired exit date.

The two guys who've sold their businesses, noting a higher value, were asked to stay on 3 and 5 years respectively with a substantial proportion of the monies only payable at the end and with performance targets.