Have you ever bought or sold a cleaning business?

rob allen

Administrator
Staff member
Administrator
Sep 5, 2007
39,304
20,187
113
Va.
www.drynclean.com
Real Name
Robert Allen,Jr.
Business Location
United States
Did you buy or sell? How did you arrive at a valuation? How did it work out for you?
 

Dave Weidlich

Active Member
Nov 19, 2013
117
38
28
66
Petaluma, CA
www.advanceddry.com
Real Name
Dave Weidlich
Business Location
United States
I bought my business in 2012 from a friend who had been trying to sell it for a year. I paid 50% down and made monthly payments to him for the remainder. What I received was equipment, training and a very old van. The best thing I received was a few hundred loyal customers who were strong believers in the low moisture cleaning system we use.

A business consultant/friend told me that the rule of thumb for valuing a business to sell is to total the last three years of income (after taking out expenses). So, if the business brought in $150,000 a year for three years and had $50,000 in expenses each year, the business would be valued at and offered for $300,000. That's much more than I paid. I can't imagine getting that for my business, but who knows?

It's sad to see carpet cleaners retire and let their business dwindle to nothing when they could sell it. I'd buy a business if only for the customers.
 

Dave Weidlich

Active Member
Nov 19, 2013
117
38
28
66
Petaluma, CA
www.advanceddry.com
Real Name
Dave Weidlich
Business Location
United States
A mentor of mine said the best way to sell a business like mine would be to hire a motivated person who wants to work his way up to being the owner, similar to a house - rent with option to buy. Part of his/her compensation would be an increasing stake in the business. I haven't pursued it, but it seems like a workable plan. I would love to see a plan like this drawn up on paper.