[emmaedj]

How do you go about valuing a cleaning business??

I started my cleaning business 4 years ago, as most of you know its hard work and i have had my share of 18 hour days. i currently employ 16 staff and concentrate on commercial cleaning, although we do have a reidential round and window round and regular and on going carpet cleaning. However it has all become a bit to much lately and my life is a mess with the business taking over. I do not have a social life, or a marrige to talk of and my kids have forgotten what i look like!!! I go through staff like you wouldnt believe, and basically its making me ill, and i have had enough. Troubleis i dont just wanna walk away as i have worked really hard. I want to sell up but how do you value a business.
My turnover is about £140,000 with a pre tax profit of £60,000 any ideas what its worth??? Thanks

[cml]

You may want to seek professional advice on this one but as an estimation you will want to consider a 10% figure on turnover then negotiate upwards with good lucrative contracts in place or a potential buy will almost certainly be looking to negotiate downwards if contracts are not secure.  Meaning they are not for a fixed duration and can be cancelled at short notice.  Then they will turn their attention to your staff and their contractual agreements with your company etc. 

Take professional advice on this to ensure you take full advantage of all the  options available to you.

[Colin Stokes]

In my experience starting point is 2.5 x Net Profit

From there up or down depending on strength of contracts versus goodwill, equipment/assets included and how much sellers want to get rid of and buyers want the business

I'm sure you can get twenty different answers on this - best bet is to spend £140 on 2 hours of an accountants time for professional advice

[Paul Kettless]

Surely another option is to take all the "hassle" of running a business away from yourself.  If you have 60k a year pre tax profit, you have a large scope to employ someone to manage your company for you.

Thus, you will free up your time, and still have an ever expanding business.  I know a chap who has done just this with his building firm, and he know earns 30k a year for a couple of meetings a week.  Now spends most of his days on the golf course.

Just a thought.

[jana08]

hi emma,

i was just wondering if you could give me a few tips on building my customer base.

it seems asif you know what your doing.

jana

[julie ellis]

Emma have a look on page 2 of this section of the forum bottom of the page ..business valuing...hope this helps

Julie