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Buying a Garden Maintenance Round

Hello allA third party has informed me that a local gardener is upping sticks and retiring to Australia and is looking to sell his business. By all accounts he has 13 customers, he charges £12 per hour and visits them on a regular basis and I was told that he earns £500 per week. Work carried out is the usual lawn mowing, pruning, tidying up etc nothing to demanding or complicated.My question is how would one value such a business? What are the potential pitfalls I should be aware of?An immediate problem would be if (after proper research, meet and greet etc etc) I handed over X amount for 13 customers and then lost some of those customers I have in all intents and purposes paid for nothing.I obviously have no first hand details of the business but I also have no idea how to value a business like this. Any help and guidance gratefully accepted.RegardsPaul

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  • Speak to the gardener first. Find out what else this entails, equipment, marketing, contracts etc all throw up questions that only he can answer. Does he employ anyone?

    Good luck
  • PRO
    It is only worth what someone is prepared to pay for it.......

    However, a small business with only one employee/worker/director probably has very little value as far as domestic contracts are concerned as people tend to want the worker themselves rather than the business.

    That is to say if it changed hands then the potential customers in the gardening round may look elsewhere if they do not like the new owner(s).

    It seems very tempting to offer to pay for £500/week, £2k/month, £24k per year but I personally wouldn't.

    Overheads on a maintenance business can be surprisingly high - I reckon it costs about £40 each day (£200 per week) before I have left the house for van I run. This overhead covers my fuel, insurance, depreciation, purchase of tools etc. If I were only charging £500 per week then this £200 weekly overheads would seriously eat into my profits and would need to charge more.

    £12/hour is not a realistic wage to charge out a professional gardener, £20-25/hr more realistic and £30-50hr if you can get it. You don;t have to give the customers an hourly wage either, quote for jobs on a job by job basis and keep the hourly wage secret for yourself. I know lots of people who would turn their noses up at £50 per hour but would gladly pay £50 to cut a hedge (even if it only took you an hour!)

    The tools and other tangible assets that the business currently own might have some value but it depends on the condition, and again, what you are prepared to pay for them.

    Sorry of I have portrayed an image of doom and gloom, but hopefully I am being helpful!

    -Nick
  • This guy reckons his business is worth £15k and he turns over around 900 per week

    http://cgi.ebay.co.uk/Garden-and-Property-Maintenance-Business-for-...
  • Iam with you paul

    I think where you live has a bit to do with the rate you charge. domestic i charge £14 ph, Commercial/hedge cutting, tidy ups etc etc is priced on the job itself thats were the the large hourly rates come in if you look at it that way.

    Only you know the area you live in and what you can charge those customers. I think with the figures being thrown around here you can get a rough idea on hourly rate.

    If your growing your business and you want to get a good customer base £12 is fine

    On the topic i agree with pro a 100% if i was to pay for it i would give a couple of hundread quid if that.

    Paul Williams said:
    I feel quite depressed reading these comments because this guy sounds like me. I don't think some of you live in the real world saying £12 per hour isn't realistic. I wouldn't have any customers if I charge £15/£20.
  • Don't lose heart Paul....... if you're gardening in a less affluent area, people often can't afford to pay more than £12/hour however its probably worth insisting that you do 1.25hours minimum so at least you get £15!!.... otherwise you'll be rushing around frantically all day!

    Paul Williams said:
    I feel quite depressed reading these comments because this guy sounds like me. I don't think some of you live in the real world saying £12 per hour isn't realistic. I wouldn't have any customers if I charge £15/£20.
  • Maybe he's making more selling the Rolf Harris prints !!

    Dan Frazer Gardening said:
    This guy reckons his business is worth £15k and he turns over around 900 per week

    http://cgi.ebay.co.uk/Garden-and-Property-Maintenance-Business-for-...
  • if you advertise / flyer the area you will pick up his customers after he has gone anyway !!! :-)

    13 is not many customers , how is he earning £500 p/w from them ?? if £300 profit its less than £30 a customer every week for 52 wks

    i have about 40max and only earn about that for gardening @£20 p/h. (not inc big jobs)

    i wouldn't buy it personally even for £500 , be careful , but look into it if u need the work £100max

    as you can generate your own customers..............spend ,spend , spend $$$$$$$$$
  • £21 p/h for an hour.........................bucket, rag and some ladders (maybe 2 men)

    £12p/h each CASH if it takes 15 min @£6 per/house.................( i think i pay £6 for 15min max)

    Dave C Cut n Edge Lawncare said:
    looking at charging rates of say £15 per hour have you worked out how much a window cleaner chargers for say 20 mins work then multply by 3 and see how it compares ??? just a thought guys
  • true - it really should be £25 minimum with transport/fuel. but more like £30 is fair ??

    thats £150 for 5 cuts inc travel time between jobs -fuel /oil/ fuel/strimmer wire ,servicing , buying mower /van etc /insurances

    if ur lucky to get 5 decent a day for 5 days !! not ! so £100 for hard days work, (with No holiday pay,sick pay or pension#) = not-a-lot :-(

    Pro Gard said:
    Paul, Its not about what you or anyone else charges but simply the value of buying this particular business.

    With only 13 customers the client base presumably is mainly day work, lose a couple of customers and its only a £400 per week income.

    The biggest assets of selling any garden maintenance business will be the equipment. It is quite shocking to add up the purchase costs of all equipment we use on a day to day basis, farr more capital expenditure than many trades, IMO this needs to be reflected in hourly rates.

    Out of what we charge we have to add on the cost of the things an employee gets for free ie holiday pay, sick pay etc. Total the hours spent in the evening and call this overtime, then take all the other overheads and consumables out and even charging out at the high end say £20ph there isn't a lot left.
  • If the guy is grossing £500 per week at £12 per hour then he must be working just over 40 hours per week?

    If he had agreements for say regular lawn cutting (21 to 30 cuts per year) I would be tempted to offer no more than 2 - 2.5 X the value of the per cut price.

    Remember when thinking of buying accounts they are never worth what the person selling them thinks they are and there is never any guarantee the client will stay with you after you have taken over.

    If I was in your shoes and looking to purchase some clients, I would cherry pick the ones that offer the best option to make a small profit from lawn cutting / treatments and ad hoc tidy ups. A small token payment to be made up front and the balance after three visits. With say 13 clients, I would be looking to knock these out within one day for lawn cutting and hopefully green waste left in their compost bins.

    Let's assume you take over 10 clients at an average cost of £25 per client to purchase them - that's £250 to fork out. Even if you cut the 10 lawns weekly at a cost of £12 per lawn - you would be in profit by £110 after week three less servicing costs and thereafter hopefully £120 every week for less than one days work during the growing season. Then offer say a monthly 3 - 4 hour visit at £15 - £25 per hour (but quote fixed price) for general maint. This would hopefully still leave you with sufficient free time to service your existing clients and any new ones.
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