The Grass Doctor

How much should I pay for the purchase of a lawn mowing business?

The business grosses 50-65k per year (depending on the drought). It has 50+ loyal customers. The purchase would include equipment. In the research I have done, I've found a variety of ways to calculate a fair price. The sellers think 1.5 or 2 times the income of the business for a year is accurate. I think this is WAY too steep. There is no doubt that the business is profitable, but I just want a logical and reasonable way to present an offer to them.

Public Comments

1. At the most, 60K (i.e., single annual Income) for Good Will and 'fifty plus loyal customer', in addition to depreciated value of equipment, will be adequate, provided that suits both of you (i.e, Buyer and Seller). Good Luck !
2. actually the seller is right about 2 times the gross but you can always call any business accounting firm and they should help be sure and check the seller/business credit rating
3. In the current economic situation, I'd want to see the paperwork for the current quarter, compared to this quarter for the last few years. In a recession, one of the first things most people would eliminate would be a mowing service. And calculate the difference in net income from last summer's gas prices to the projected price this coming summer. (Don't let me rain on your parade, but I'd think more than twice about getting into a business that people could stop using when money gets tight.)