Can I sell it?

[C63sxb]

Hoping you guys can help with this...

I'm currently in a situation where we do plumbing & heating works for numerous managing agents over the home counties.
This is a small part of other services we offer for them, all under one company.

The department turns over £600-700k per annum with profits running at 10-15%.

Our customers are solely B2B, there are no contracts, they use us because they like us.

The issue is I really don't enjoy it.

The question is could i sell it and how?

I've got a meeting with a competitor on Friday, but interest to hear opinions and thoughts.

[Louis Balfour]

C63sxb said:

Hoping you guys can help with this...

I'm currently in a situation where we do plumbing & heating works for numerous managing agents over the home counties.
This is a small part of other services we offer for them, all under one company.

The department turns over £600-700k per annum with profits running at 10-15%.

Our customers are solely B2B, there are no contracts, they use us because they like us.

The issue is I really don't enjoy it.

The question is could i sell it and how?

I've got a meeting with a competitor on Friday, but interest to hear opinions and thoughts.

Yes, but not for a lot.

I've seen this very question raised and answered before, specifically in relation to a plumbing and heating business.

The seller's accountant unwisely told him that because he had a business turning over £x000k he could sell for multiples of it. In reality he was selling a database of previous sales plus goodwill, because it had no assets to speak of or infrastructure.

You have said that you get work because people like you. They might not like the new chap(s).

Unless you can remove yourself from the business and it still run without you, I don't see it being worth a great deal. And be careful with that competitor!

[C63sxb]

Thanks for your reply.

Just to clarify, i'm not after multiples of profit.

Its really a case of does it have worth and how to sell it.

If not, I will most probably knock it on the head early next year.

[Blue62]

I’d say it’s not worth much as a stand alone business based on your description. Have you considered hiring someone to take over from you instead? You could strike a deal whereby they gradually take over the clients and work, while paying you off over time. You’d need to be choose wisely and draw up a contract, but it might be a better exit route than just walking away.

[lizardbrain]

Be careful with divulging any sensitive info to the competitor. they probably see it as a free way to pick your brains and it's basically impossible to stop them pulling out at any time once they feel they have had their fill of 'due dilligence'

there is definitely a market for marketing lists and customer lists though it's unlikely to be valued as a traditional business

Does your website have decent search rankings and a brand?

Edited by lizardbrain on Sunday 11th August 10:53

[C63sxb]

Hi,

When I say competitor, I’ve known him for years and we’ve got a close working relationship. I already subcontract other services to him.


There is no website, it’s just B2B. Customers use us and take us with them when they move on to pastures new.

That’s how we’ve grown always, never advertised

[Louis Balfour]

C63sxb said:

Thanks for your reply.

Just to clarify, i'm not after multiples of profit.

Its really a case of does it have worth and how to sell it.

If not, I will most probably knock it on the head early next year.

The fact that you can do that reinforces the impression that you ARE the business. No YOU, no business.

However all the above having been said, you might find someone prepared to pay for it. I've seen stranger things happen.

[MaxFromage]

Everything has a price. Profits are low, so it depends how a change of ownership could improve this. I'd imagine 1-1.5x profits is achievable, but it is an unusual case and not one I've had direct experience of. The person you've worked with would seem a suitable target.

[LastPoster]

Part of your appeal to the Managing Agents may be that they only deal with one supplier. One helpdesk, one account manager, one composite invoice per month etc. remove that and you may be removing one of your plus points

Could you set up a separate internal company for the plumbing works and get a partner in to actually run in. All the same company when public facing to clients but separated behind the scenes

[C63sxb]

LastPoster said:

Part of your appeal to the Managing Agents may be that they only deal with one supplier. One helpdesk, one account manager, one composite invoice per month etc. remove that and you may be removing one of your plus points

Could you set up a separate internal company for the plumbing works and get a partner in to actually run in. All the same company when public facing to clients but separated behind the scenes

This to be honest is the only thing holding me back. I might trial it with one of our agents and see how it goes.

Thanks for the input