[Moderator David@stives]

He told me 10%   :





 

[ronnie paton]

selling one of your rounds is NOT selling your buisness man! sweat and tears,i can understand the sweat from working,but tears?...do u fall of your ladders alot?  
its jus people in the north west...the rule of thumb for selling A round is no more than 4x,a buisness as a whole a little more,but in the north west they jus want more coz they greedy,simple.

were greedy for selling ur business/round for more than 4 x ?? its theres to sell so who are you to say there greedy.

you wouldnt know what sweat and tears are you buy you rounds cause you cant build one, and you get them for next to nothing.

[ronnie paton]

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Sender: Ian Lancaster
To: Ronnie Paton
 
Subject: Re: franchise
Date: Jan 14th, 2009, 4:18pm 
Ronnie Paton wrote on Jan 13th, 2009, 7:07pm:

so if you guarentee the work you replace it once its lost?? doe the franchise price depend on the work you provide them with?? how do you find the time to train them for a week?? and finally how do you go about training some one from scratch??
sorry for all the questions.

The 20% royalty is high, because we provide the work, that's part of what they're paying for.

this is what i was told. :

 

[Clive McDonald]

Hi Ronnie,
I wouldn't make an issue out of this as it's not really any of our business and probably confidential.

Reading what both you and dave say it is highly likely that you are both right.As an ongoing franchise fee 10% sounds more likely, as part of a franchise purchase agreement 20% is more likely. Some may have stumped up a larger upfront fee than others etc.Whichever it is, it's not really fair of us to bandy his business about, and i'm sure we all wish him good luck.

The general point that our businesses are worth more than we tend to get for them is true.The best exit strategy seems to be either Ian's model, or like Dave set the firm up so you have hardly anything to do apart from direct staff and are virtually semi retired.

[Clive McDonald]

finding the buyer is the hard bit, lots of people have 20k to 500k and would buy a biz tomorrow if it was a cert, but the process of due diligence is hard.You may for example ewan, be able to size a round up because you have experience in the sector, but you might also want it cheaper than this.

If you take this thread topic the guy asked for a value, he gave us some details t/o etc, two small vans, 30 mile radius, but he didn't tell us how many men, or if one was a partner or a senior employee.Much of this particular round value i suspect would be paid out in wages.I couldn't even understand why on such a small turnover had he been ltd for the past four years?

The popularity of franchises such as molly maid (cleaning) rely on the fact that people think they are buying a managment franchise- which is yet another aspect. Not many on this forum believe a wc biz can be run without some kind of physical involvement and this has an effect on value too.

[Clive McDonald]

yes ewan, but the problem is that most of us can work well even with a helper who is not great, or even a couple of guys who need watching.But to walk away completely we need better quality employees who inevitably expect to be paid more.

So if you do build a fab money machine based on pasties and doughnuts instead of proper wages the real value may never be achieved.

[tam Moffat]

When your are buying a Round/Busines. Your are not buying the round/busines, you are buying the good will that the previouse  cleaner  suppied. If that last person was not reguler, got complaints, not doing a good job, scruffy, different cleaners everytime they cleaned. I would question the price they were asking.  Go around with the guy you are buying the round off and intoduce/find out, if the guy is genuine. Tam

[Moderator David@stives]

Tam

Not all businesses are domestic, my customers dont give a damn who has cleaned there windows as long as they are clean.

As some people have pointed out there is a vast difference between a round and a business.

If i wasnt regular or got complaints my business growth would be hampered and that would be reflected in what my business could achieve.

[D woods]

Hi Guys

3 years ago we were going to buy a commercial window cleaning business
in London that turned over £325,000 per year.

All the work was top quality commercial and all staffed out. All we would have had to do is change the name on the invoice.

We came within one week of paying the money when the owner changed his mind (he was going to live in Spain)

We were going to pay £175,00 for the work. Which is probably more than it was worth as a stand alone business, but for us it would have been a great buy as it fitted in with all our other contracts and we would have earned the money back in a short period

[bluez]

yes ewan, but the problem is that most of us can work well even with a helper who is not great, or even a couple of guys who need watching.But to walk away completely we need better quality employees who inevitably expect to be paid more.

So if you do build a fab money machine based on pasties and doughnuts instead of proper wages the real value may never be achieved.

The quality of staff is rarely an issue, it is the quality of management that counts imo

[Clive McDonald]

I'd hate to have to make calls like d woods, i wouldn't sleep....If i got it right i'd be over excited and continually talking about it, and if i got it wrong i'd be gutted.

Bluez, staff makes a difference when you only have a couple.Do they regard themselves as some kind of partner? do they feel they are being sold too as part of the fittings?. The point was that the origninal poster didn't give any insight into this.He gave turn over, the fact that he was limited and had two small vans, and worked within a thirty mile perimeter.What i was suggesting was that the value would be affected by how many people were needed to operate this and how they were structured (ie, was there a partner, or a trusted guy who had to be paid well to work unsupervised etc- because a turnover of 60k doesn't look too good once two good wages are taken out)

[1wayno]

selling one of your rounds is NOT selling your buisness man! sweat and tears,i can understand the sweat from working,but tears?...do u fall of your ladders alot?  
its jus people in the north west...the rule of thumb for selling A round is no more than 4x,a buisness as a whole a little more,but in the north west they jus want more coz they greedy,simple.

were greedy for selling ur business/round for more than 4 x ?? its theres to sell so who are you to say there greedy.

you wouldnt know what sweat and tears are you buy you rounds cause you cant build one, and you get them for next to nothing.

i know its theres to sell,but askin for 7-10x for a bog standard round is greedy to me and alot of other people coz that is waaay over the rule ofthumb for selling and buyin rounds!
and i have built up my work alot actuallyand i know what involved,after new year im doin a big canvass on this street with leaflets and my buisness cards,as long as ur confident its not that hard to knock on the doors and pick up work,ur making it out like window cleaning is really difficult wen really its not as long as u know what ur doin,but hey,its a difference of opinion,alot of people will agree with me,and people will agreewith u so,whatever trever!  lol

[bluez]

I'd hate to have to make calls like d woods, i wouldn't sleep....If i got it right i'd be over excited and continually talking about it, and if i got it wrong i'd be gutted.

Bluez, staff makes a difference when you only have a couple.Do they regard themselves as some kind of partner? do they feel they are being sold too as part of the fittings?. The point was that the origninal poster didn't give any insight into this.He gave turn over, the fact that he was limited and had two small vans, and worked within a thirty mile perimeter.What i was suggesting was that the value would be affected by how many people were needed to operate this and how they were structured (ie, was there a partner, or a trusted guy who had to be paid well to work unsupervised etc- because a turnover of 60k doesn't look too good once two good wages are taken out)

Slump
You need to read the post I quoted for the relevence of the point.

Of course you are correct when selling a business with staff they will have concerns and issues but my point was in relation to running a business with staff as addressed by the post I quoted not about selling a business with staff or about the original posters question.

In answer to the OP's question, price as high as you can while still having a chance of attracting a serious buyer. No one will offer you more than you ask for so give it every chance.

Sounds like a decent business to me based on the available info.

[Sean Dyer]

i dont think that bad staff is always a management problem, its a management responsibilty to get the best out of staff yeah, but they had to be something there in the 1st place to encourage, othewise why bother interviewing etc just get anyone and hope they will be okay


On the subject of rounds i would sell any of my work at 10 x monthly

Why not?

as a business? not so sure
i have thought about selling in a few years and using the money to change careers.

hypothetically if i have a business that has pre tax profits at around 50 k maybe just over, turnover at 67000 (just under vat)
sell with van and system i would expect 50 k easy!

where else could someone walk into a 1k a week business??

[bluez]

i dont think that bad staff is always a management problem, its a management responsibilty to get the best out of staff yeah, but they had to be something there in the 1st place to encourage, othewise why bother interviewing etc just get anyone and hope they will be okay


On the subject of rounds i would sell any of my work at 10 x monthly

Why not?

as a business? not so sure
i have thought about selling in a few years and using the money to change careers.

hypothetically if i have a business that has pre tax profits at around 50 k maybe just over, turnover at 67000 (just under vat)
sell with van and system i would expect 50 k easy!

where else could someone walk into a 1k a week business??

Sorry to disagree with you Sean but Bad staff is always a management issue, if you have bad staff, get rid. Average staff on the other hand can be problematic as they dont always give valid reasons to dismiss them and you can get stuck with them for a longer period of time.

[Clive McDonald]

Sorry for trying to address the original topic bluez when your thoughts though totally irrelevant seem far more interesting to you.

This business can not be valued without the information about staff, or at least some information about staff.He has two small vans, does he drive them both himself?, or has he including himeself two two man teams in each vehicle?

And why with such a small turnover is he limited?

Trying to sell a biz/ round is fine, but realistic questions will be asked to help determine the value.

[bluez]

Sorry for trying to address the original topic bluez when your thoughts though totally irrelevant seem far more interesting to you.
This business can not be valued without the information about staff, or at least some information about staff.He has two small vans, does he drive them both himself?, or has he including himeself two two man teams in each vehicle?

And why with such a small turnover is he limited?

Trying to sell a biz/ round is fine, but realistic questions will be asked to help determine the value.

Thats a rather odd thing to post Slump, as you are right my post had little to do directly with the original question but had in fact to do with your reference to staff and exit strategy which I quoted, should I have ignored the post you made? perhaps my post count would be higher if I did just post thoughts I found much more interesting to me !

You will notice that I addressed the original question at a later point when I had considered other peoples opinions and decided if I had something worth adding to the question asked.

[Clive McDonald]

I get cheesed off with the forum too for different reasons.It used to be the negativity and the attacks, but that happens less now.The newbs have more vision, but there are only so many times you can read; i'm hoping to buy a system next year and expand......This time of year many would post what they had achieved and what they had planned but much of that has gone too. It's become a very tame forum, full of newbs and cosy old timers.

I have put some very interesting stuff up that doesn't even get replied too.Electric reels- don't care.New scudo 1200kg van-don't care.New employee doughnut motivation programme-don't care.Longest self install hot user on the forum- don't care.Brilliant innovational marketing strategy-don't care.

So like you bluez my posting libido is very limp.

[gewindows]

I posted some interesting stuff recently Slumpy about the mottled colouring of South-Chilean Flamingo eggs that hatch in the spring compared to those of the infamous Brazilian Grey Flamingo, better known for its soft, alluring plumage and leathery feet.

I know what you mean, theres some right boring people on here, no-one replied to my thread.

[Sean Dyer]

i dont think that bad staff is always a management problem, its a management responsibilty to get the best out of staff yeah, but they had to be something there in the 1st place to encourage, othewise why bother interviewing etc just get anyone and hope they will be okay


On the subject of rounds i would sell any of my work at 10 x monthly

Why not?

as a business? not so sure
i have thought about selling in a few years and using the money to change careers.

hypothetically if i have a business that has pre tax profits at around 50 k maybe just over, turnover at 67000 (just under vat)
sell with van and system i would expect 50 k easy!

where else could someone walk into a 1k a week business??

Sorry to disagree with you Sean but Bad staff is always a management issue, if you have bad staff, get rid. Average staff on the other hand can be problematic as they dont always give valid reasons to dismiss them and you can get stuck with them for a longer period of time.

The quality of staff is rarely an issue, it is the quality of management that counts imo

your quote i was addressing to say that bad staff shouldnt be managed they shouldnt be there in the first place!