I am interested in buying a home inspection firm with 1 owner, and no employees, with a net income of roughly $65,000 annually. What is a fair asking price for the seller of the firm.
What are you going to get for your money from this one man “firm”?
Why pay for an existing when you can go after customers with some careful effort and marketing? I know this can be a long haul but get started now.
Typically the business is not worth too much - value of tools and software if any. You also take on past liability for problems with inspections and any other issues the sellers company may have.
I understand that Scott. There is someone that’s been in the business for over a decade, with and average annual net income of 60k with a big cliental, but it looking to retire. He gave me a number that seems way to unrealistic for a business with no other employees. I am just trying to figure out if it would be a good investment. But with the amount he’s asking I could invest heavily into the marketing.
IMO, a one person inspection company is nothing other than the owner. He cannot sell himself to you.
Maybe his website ranking has some value. Phone number may have some value. But he is the actual asset.
Spend the 65K on a great website, vehicle lettering, uniforms, etc. and take the business by hitting the streets with your own show.
With everything available through NACHI and other resources, it an be done.
Thank you Alan, and I just established my business a few months ago, i have all the tools, equipment, and software needed to continue running my own business. I just figured maybe i could purchase the business from this gentleman at a reasonable price, and have a steady inflow of work from his cliental.
Thank you guys for the advice.
Pay him 15% of every inspection for the rest of his life that comes thru his contacts.
If you were to spend half of that $65k on advertising you be better off.
One of my friends sold his business a few years ago to a trainee. Basically sold his phone number, website, and his agent Referral List. After a short time when the agents found out it wasn’t my friend anymore nobody used him. That guy is not in business anymore.
Bingo! That is the facts. Every time!
Welcome to our forum, Matthew!..Enjoy!
If you can show/prove to the buyer how he can make $200,000.00/year clear, you can easily sell it for double that.
It may take him a couple years to ramp up with you mentoring him/her but it can be done.
You ASSUME this, but there are NO guarantees HIS clients will continue with you regardless of how good you are… and as a newbie, there is slim chance of that happening!!
Is yours for sale?