How does one figure up the price of a residential WC business and a commercial WC business?
What sort of customer retention should be expected, and should retention be a part of the contract?
Thanks!
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I think Brian may be refering to the cost of buying, or selling, an established window cleaning business.
I think that price varies from business to business, and there’s no sure price that goes across the board. There’s a lot of variables that need to be considered, such as the gross sales, net sales, profit margin, how old are the accounts, whats the potential for growth, are contracts in place, how well was the business managed, what equipment comes with the sale, and there’s more…
Typically though, a sale a of a window cleaning business starts at a price equal to 3 months gross, according to what I’ve read.
In some places if the biz is well established you could get up to a years gross but as Micah said the variables would have to be pretty solid, the biggest of which would be assurances of customer retention.
Typically though, a sale a of a window cleaning business starts at a price equal to 3 months gross, according to what I’ve read.[/quote]
Micah, I have heard that amount many times too. I sold my first window cleaning business for three months revenue about 25 years ago. My CPA came up with the price.
I bought my company on May 2008 and I pay BIG money, but don’t regret it at all.
Sometimes I feel like overpaid for it, but seller is a friend who moved out of the country and he still call customers and make appointments for me when I’m busy or there are certain customers that don’t know me yet, so I think that support has a price.
Good to know…
What kind of customer retention / sales retention should be expected and/or stipulated in the terms?
If you pay 3 months gross I doubt you’ll get much retention assurance. If you paid a years gross I’d expect to get a years retention on the whole list of clients.
If you do a great job you will surely retain your clients. Other than that your fighting a losing battle and your clients will seek out other window cleaners. I have some clients for as long as 13 years. I do my best and hope they stay happy.
Hope this helps…
Commercial Accounts in my area, southern california, sell for 3 times their monthly receipts. Basically… Twice a month at 100 a pop… account would be valued at 600. And YES!! Retention should be discussed with the outgoing cleaner, the incoming cleaner, and yourself.
As far as Residential, 10% of the single service price. And you can’t really expect too much retention. Home owners will choose who they want. The introduction of the new owner is VERY important in retaining the customer!!
