How would you evaluate a sale price of a detailing business?

[ahheck01]

For those of you who have witnessed or been involved with the sale of a detailing business, how would you assess the valuation? As I grow and solidify my business, one thing I want to have in mind for the long-term is my exit strategy for down the road. How do I maximize the value to where someone would conceivably spend $50k, $100k, $200k for my business?



Thanks all.

[JohnKleven]

You will need to keep good books, and show a healthy profit. If you own a building, I think it would be worth even more.

[Nth Degree]

The problem for a lot of detailers is they are the business. As John said, good records would be key. I think a percentage of the sales over a course of time would probably net you more than you would find someone willing to pay in a lump sum up front.



I recently bought a client list from someone who moved from the area. In just over a months time I will have recovered my cost. So speaking from the side of the buyer... I would have been willing to pay more through a percentage than I was willing to pay in a lump sum due to the lower risk. I got a great deal and the seller got what he needed, which was money up front to fund his move. The problem with a percentage situation is the honesty of the person paying.

[bigltc]

Show guaranteed repeat business as opposed to all one time customers.

[ahheck01]

So, say I have 120 cars from dealerships per month (avg gross is $100), handled by 2 full time and one part time detailer (whose employment `comes with` the business), and 80 individual customers that bring their car in once a month either for a express detail (thorough wash and wax), or for a full detail, handled by myself and one full time detailer that comes with the business (average gross is $200), and that`s been fairly consistent for 12 months (all season), what would be the anticipated value of something like that? Monthly gross is roughly $28k.

[Nth Degree]

Ultimately it`s only worth what somebody is willing to pay for it. You should talk to a CPA who has some experience in this sort of thing.

[David Fermani]

I sold my detail business and it worked out pretty well, but you`ll need a proven track record of income security to make it attractive to a potential buyer. It takes several years to implant this. Actual Cash Value is very subjective and negotiable.



I would actually prefer to buy a pre-existing business with a history of documented returns over starting a new business. Nothing like being able to take over and start collecting an income with enough employees in place to handle things.

[Envious Eric]

if you are the business, you cant sell it unless its scalable! As in, if you are owner operated and do only correction work, YOU are the BUSINESS. Without you, there is no business as someone else cant do what you do. Owner operated business are nice for the fact there are potentially less headaches, but you just created a job for yourself, not a business. You are the employee, bookkeeper, marketing director, scheduler, etc. having employees doing the work for you while you handle the admin things = a sell-able business IMO

[jose206]

I`ve actually been considering selling my business also. Where would someone even go to list their business for sale? Has anyone had any experience with buying or selling a mobile detailing business?

[Envious Eric]

you can go to a business broker

[MX823]

BizBuySell - The Internet`s Largest Business for Sale & Franchise for Sale Marketplace



I don`t know how often the above site is used or the quality of the traffic.

[jose206]

Awesome, thanks guys I`ll check them out.