Ideas on how to sell a Tree Care business?

[Joshuableu]

Hello to all.
I am looking for advice on how to sell a tree care business.
I am partner (the 'office' guy) in a very successful, profitable and respected tree service company that has an ISA certified arborist as its lead. He has decided to retire from the business due to family issues.

The company is based in an affluent city of about 80,000 in south-central Indiana. The company is currently small (approx $300k gross revenue) but has excellent growth potential as there are no other local ISA certified arborists.

Suggestions?

 

[Jed1124]

Hello to all.
I am looking for advice on how to sell a tree care business.
I am partner (the 'office' guy) in a very successful, profitable and respected tree service company that has an ISA certified arborist as its lead. He has decided to retire from the business due to family issues.

The company is based in an affluent city of about 80,000 in south-central Indiana. The company is currently small (approx $300k gross revenue) but has excellent growth potential as there are no other local ISA certified arborists.

Suggestions?

Contact one of the local nationwide companies and see if they are interested. With a 300k gross it might be tough but the big three are buying up small companies left and right.

 

[TheJollyLogger]

What exactly are you selling? What equipment do you have? Was your arborist also your climber? Not really enough info. How long have yall been in business?

 

[Bearcreek]

What exactly are you selling? What equipment do you have? Was your arborist also your climber? Not really enough info. How long have yall been in business?

My questions as well. Also, if the certified arborist is retiring, that part of the value is no longer there, or did I misunderstand something?

 

[rngrchad]

Just get another certifigied arborist and keep running it.

 

[ATH]

There can't be more than 2 other full timers helping the Certified Arborist, right? Even that seems a stretch. Are you full time as well? Paying 3-4 full time on $300K gross doesn't leave a lot of room for to cover other operating expenses.

Not to sound harsh, but if the arborist leading all the work is out of the picture, what value is left? (besides the equipment?) Is that arborist wiling to stay on to train a replacement? If so, there may some potential there. Do you have recurring contracts for services? If so, there is certainly value there.

Big picture "what is a business worth?" (any business, not just a tree business):
What is the NET revenue of the business? To figure that out, ask if you:
*paid somebody to do your job
*paid somebody to do the other co-owner's job
*continue paying employees
*continue investing in equipment
*continue maintenance of equipment
*continue purchasing consumables
*continue to pay taxes, insurance, etc...
---now, how much is left? This is the business' profit. Multiply that number by somewhere between 3-5 and that is what the business is worth to an investor - assuming you can hire somebody equally replace what you are doing and what the co-owner is doing.

The reality is that for many tree care businesses (my own included, so I'm not trying to put anybody down here!): There is more money in equipment and real estate than there is in that equation I just gave....and once that is gone, there isn't much of a business left.

 

[TheJollyLogger]

Yeah, you said the quiet part out loud... Without the certified arborist, which was their main selling point, and at only 300k annual, it sounds like it comes down to equipment

 

[ClimberBusinessman]

Contact a business broker--they're kind of like a real estate agent for businesses.