# Approx value of this all skidstear driveway clearing business?



## gardenpro (Oct 9, 2003)

I'm in talks with a guy who's selling his long time business of 60 regular driveways all within about 3-4 blocks. Most already signed for upcoming season. Many he's had for over 20 years.

The customers each pay $700 per driveway paid prior to first snowfall. Clean up at every 4". We get a lot of snow so there's likely 25+ days per season but you never know. 

So that's 60 contracts X $700. Total gross $42k contracts only. 
The bobcat with bucket and snowblower priced separately. 

Any ideas what that would be worth? He is asking $100k for the route. I think he's crazy but I have no idea what the going rate is, and would like to make a sound offer for consideration and not low ball or be swindled either!

Thanks.


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## dieselss (Jan 3, 2008)

So just contracts alone...42k. Leaving 58k. No regular skid is worth that money. 
I'd say he needs to recheck his math.


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## grandview (Oct 9, 2005)

Since he collected all the money,he would owe you. Give 5% of the contracts and he keeps the skid,


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## 1olddogtwo (Aug 6, 2007)

So he's already been paid (partially) for this year and wants a 100k?



700 @ 4in are good numbers but not worth the amount he wants.


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## gardenpro (Oct 9, 2003)

Ok thanks. Is there a formula to figure out the ballpark value? Everyone agrees he's asking too much. What would you sell or buy something like this for?

I understand how that many clustered contracts is worth more than if scattered, and long term relationships built by the current owner could be valuable. I likely mentioned that many have been over 20 years so as long as you do a similar job there's a very good chance you will around long term.


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## terrapro (Oct 21, 2006)

gardenpro;2032199 said:


> Ok thanks. Is there a formula to figure out the ballpark value? Everyone agrees he's asking too much. What would you sell or buy something like this for?
> 
> I understand how that many clustered contracts is worth more than if scattered, and long term relationships built by the current owner could be valuable. I likely mentioned that many have been over 20 years so as long as you do a similar job there's a very good chance you will around long term.


3 months worth of gross plus equipment


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## Mark Oomkes (Dec 10, 2000)

How to say this in a politically correct way: this guy is mathematically and business-savvy challenged. 

If you would like a different term, please PM me.


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## gardenpro (Oct 9, 2003)

Right on thanks. 
Is there a standard in the industry or a number you can personally stomach?


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## Mark Oomkes (Dec 10, 2000)

There's a hundred or more ways of valuing a business. 

The only real way is for the seller and buyer to agree.


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## gardenpro (Oct 9, 2003)

Mark Oomkes;2032220 said:


> How to say this in a politically correct way: this guy is mathematically and business-savvy challenged.
> 
> If you would like a different term, please PM me.


Strangely quite the opposite! He's done incredibly well, has a very large company of other aspects, this is a tiny wing of snow clearing for him.
It will be (sadly) me educating him on the actual value of this business if I decide to go after it.


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## Mark Oomkes (Dec 10, 2000)

Ok, he is clueless when it comes to valuing a business.


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## John_DeereGreen (Jan 2, 2011)

Mark Oomkes;2032233 said:


> Ok, he is clueless when it comes to valuing a business.


Or he's hoping for a really big sucker to come along and just see dollar signs.


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## Turbs3000 (Feb 20, 2015)

When we buy companies we try to scale it based on retention. For example we would pay 20% on the portfolio for the first year. 15% on all that stay in year 2 and 10% on all that stay on year 3 and nothing after that.


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## LapeerLandscape (Dec 29, 2012)

The problem is your going to shell out all that money for this years work but there is no guarantee the customers will be back next year.


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## grandview (Oct 9, 2005)

LapeerLandscape;2032289 said:


> The problem is your going to shell out all that money for this years work but there is no guarantee the customers will be back next year.


Correct, I think its more of a personality thing, If they like you they will stay,if they don't like you even if you do a good job they will jump ship.


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## 1olddogtwo (Aug 6, 2007)

Tell them ur name is Grandview™.....


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## grandview (Oct 9, 2005)

1olddogtwo;2032305 said:


> Tell them ur name is Grandview™.....


Hope there's a premium on using my name.


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## TKLAWN (Jan 20, 2008)

grandview;2032307 said:


> Hope there's a premium on using my name.


Equal value of a bills victory!


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