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johnny_h

  • Posts: 689
how much would it be worth?
« on: May 12, 2009, 11:17:23 pm »
i have a cleaning contract taking £660 a month plus the supply of the consumables what would it be woth if i wanted to sell it on? not that im going to just interested
AUDI VIDE TACE

Re: how much would it be worth? New
« Reply #1 on: May 13, 2009, 07:51:54 am »
I dont think many people will engage on this as you are not seling anyway.

However just because its £660 pm. Yes it may sound a reasonable contract. However how much is actual profit.

We have both large and small contracts. We have found that on most of the smaller contracts we are actually earning more than on the larger contracts.

So lets say for arguments sake that the profit is £150 pm. x 12 = £1800 per year.

If the buyer would be lucky to hold onto that for 3 years and all went well thats a profit of £5400 so 150 x 3 months £450 tops £750 so that what its roughly worth in my opinion.

Yes I know now you might be thinking I thought it would be worth several £1000's no its generally x 3 months worth of profit not the net worth.

There are companies that lease the contracts on a 20% of the profit.

Turnover does not do anyone any favours, its profit that is required to move forward.

Obviously it depends on the area it is in, there are many factors to take into consideration like the staff wages. Tupe probably would come into play here. Are there staff doing the work or is it just you.
(If staff are there its down to them if they want to stay at those premises and not YOU)

Parking, the customer in general. Are they good payers.

If we were purchasing work we would perform a credit check on the company that is having the cleaning done. So this would play a major part in the price if it came back as they have a poor credit rating.

Other factors are length that you have held the contract for.

There is generally a reason why people sell on work and its generally that they have or know the customer is a pain. (Unless the are round builders / Contract Builders designed to sell work on) Or it might be that the rerlationship with the customer has been tarnished.

So there are many factors and many more that I have not even began to explain.

I hope this is of some help.

Dave