Need help valuing a tree business for sale.

[Duck]

Thanks much to some of you for good advice.

Thanks much those of you who gave good advice.. It was appreciated and I'l change my plan accordingly.

 

[ddhlakebound]

Without someone to do the work, the leads are worthless. It sounds as if you expect someone to buy you out, do all the work, and pay you all the profit for two years.

So what exactly is this purchasing company supposed to live and grow on while all the profit goes to you?

I'd say a more accurate valuation would be your commission for two years. Trying to suck the profit off the top and leave all the expense and work for two years is a deal you'll only get a total fool to accept.

Besides, there's nothing to say that this customer base has ANY loyalty, or even that they were happy with the work that was performed for them. And also, anyone could have competitive sites built to take a share of those leads themselves for the cost of a quality website and hosting for FAR less than you're thinking.

But that's just me....maybe I'm way off base.

 

[Duck]

Thanks Lakebound,

The purchasing company would get the websites turned over to them which means they would get all of the leads/business. I would no longer get any commissions. Yes, they would be buying me out.

From what I understand companies are sold on a multiple of earnings from 1-4 times which is what I based it upon.

I don't think it would be very easy for a company to build the websites and get those rankings, I spend 2-3 hours a day doing that type of work. Yes, it could be done, but not very easily and it certainly would not be cheap.

Thanks for the opinion though, that is what I am looking for.....Duck

Without someone to do the work, the leads are worthless. It sounds as if you expect someone to buy you out, do all the work, and pay you all the profit for two years.

So what exactly is this purchasing company supposed to live and grow on while all the profit goes to you?

I'd say a more accurate valuation would be your commission for two years. Trying to suck the profit off the top and leave all the expense and work for two years is a deal you'll only get a total fool to accept.

Besides, there's nothing to say that this customer base has ANY loyalty, or even that they were happy with the work that was performed for them. And also, anyone could have competitive sites built to take a share of those leads themselves for the cost of a quality website and hosting for FAR less than you're thinking.

But that's just me....maybe I'm way off base.

 

[ASD]

If I was to spend $77,000 on advertising / websites for two years it better bring in way more leads / $$$ then your sites do!!!!!!! I only spend about $23,000 a year on all of our different types of add's phone book,web,blue book and so on and our add's produce more $$ a month then yours do a year! and after some one buys your site they will still have to pay some one to maintain it.In this market I do not think a tree service is netting 20% it is more like 5% - 10%

 

[Duck]

Thanks ASD, I appreciate it... I was not looking at it from that viewpoint of spending the $77k over 2 years on other advertising..... and most of all for the net of between 5-10% I appreciate the info......Duck

If I was to spend $77,000 on advertising / websites for two years it better bring in way more leads / $$$ then your sites do!!!!!!! I only spend about $23,000 a year on all of our different types of add's phone book,web,blue book and so on and our add's produce more $$ a month then yours do a year! and after some one buys your site they will still have to pay some one to maintain it.In this market I do not think a tree service is netting 20% it is more like 5% - 10%

 

[danieltree]

Tree Pimping at its finest. Something for nothing.​