How would assign a monetary value to this company?

[mfgs]

Just checkatrade part. But there is nothing else, just his van and tools. He's retiring Dec this year.

I don't think I need accounts or anything, I've rented his mobile off him previously for months at a time and so all I'd need to do is have a trial period of a month or a few months to check calls still come in like before. It's just a checkatrade page which advertises the same stuff I do and has lots of feedback referring to the same stuff I do. Which is small maintenance. So it's a high lead generation, small job type affair.



I have no savings to my name unfortunately otherwise I'd probaby attempt a negotiation based on an upfront figure.

So if you are taking the phone number from him and the checkatrade account is the only way he advertises then anyone who has his number will now be calling you. So surely seeing his accounts will show you how profitable his business has been over, say the last 3 years, and only then can you look at putting a value on it. If hes been making 10k per year then you will want to be paying less than if hes been making 50k per year.

 

[WaterTight]

I know what you mean but it's a bit of special case because he doesn't use it to it's full potential and turns away a lot of stuff for his own reasons. So I have to estimate what it's worth based on what I made when I was renting his phone.

 

[WaterTight]

Something like 80% of the calls he gets are from new customers. It's designed to be very good for creating passing trade.

 

[rocketmanbkk]

I think it's risky

As someone said it only takes one bad feedback.

Risky is my view but it's not my decision

How much per week are you thinking of paying him? You must have a number. & fit how long?

 

[Rickster123]

All seems a bit dishonest to me. And I'm hardly whiter than white!

 

[WaterTight]

I don't see it as any more dishonest than phoning up a company because locally they've got a good reputation and them sending an engineer over to you who started last week.

But I might be missing something

 

[rocketmanbkk]

They're phoning because HE had a great reputation that HES built up & people trust HIM to be honest & do a good job like others have made positive comments on.

Do you see where this might go?

 

[PlumbBobBob]

the biggest hurdle I can see is checkatrade finding out a "new" company has paid for an old company's feedback and chucking you out on your ear with nothing.

 

[WaterTight]

It's a company name on the page, not a person's name. My experience of having his phone was 90% of people phoned up and said "Is this xxxx Plumbing?"

But yes some will know him and expect to get him. And just like before I'd explain he's unavailable but I work with him and can chat to them about what they need doing. Which previously resulted in no lost leads, happy customers and further good feedback. There's got to be about 30 of his feedbacks which mention me by name anyway

 

[rocketmanbkk]

I agree

It's very risky imo

 

[WaterTight]

the biggest hurdle I can see is checkatrade finding out a "new" company has paid for an old company's feedback and chucking you out on your ear with nothing.

Yeah I would check with them first.

 

[tamz]

Personally i see it as having absolutely no monetary value. All you are depending on is good faith.
If you really want to take this up, work on a %age commission as there are no guarantees for you here.

 

[julesverne]

if you know the guy really well and i mean really really well then i cant see it being a problem but it is your risk not mine.
Dont see the issue with you taking over the chackatrade part.
Companies get taken over all the time its business no one lives forever. What about father son business relationships. If youve already used here details before then whats the big deal. Dont see chackatrade having a problem all they want is your they are a business your just a customer to them aswell.
I have a lad working and a minute fraction insist on me and they dont always get me. because i cant always be there they get over it. Sure you might lose a small percentage but most will be just glad your there.

But its your risk and yours alone. But if it was me I would be interested and not as pessimistic as the others on here sometimes you have to take a risk in life and business

 

[WaterTight]

Thanks mate.

No I honestly appreciate everyone's cynicism. Partly why I posted it was hoping to get a raft of warning and issues mentioned I might not have thought of and to see if I had answers that satisfied myself. So far they have.

I think it's hard for me to get across why I trust the calls will be what they will be and I will make what I will make. He was the first person that trained me, we've worked together on and off for years and he's been talking about doing this for years as he's got less into work and nearing retirement. Because we focus just on small jobs (another thing I think many guys here find a bit alien) the customers can be less loyal and it's based on generating lots of new passing trade which it has always done well and I've no reason to doubt it still does (a no agreements signed trial could confirm this.)

My only dilema is the price as what he has suggested sounds a lot (£83 per week for 3 years, plus I would pay for cost of checkatrade)

I can see that selling if for less, in his mind given how much work it took to build it up, seems pointless. But in my mind it's a lot.

It's less for the prospect of buying it. More for the fact that I can probably double my earnings from the word go rather than spend 3-5 years building my own up.

I'm erring on it being too expensive but in order to make a counter offer I was seeking advice. Although it seems like that advice is the counter offer should be £0.

 

[julesverne]

It seems expensive. I think a trial period would be best for you. When you rented it i fhe past how much did you make from it? That would tell you if it was worth it.
Is there no way you can some money to make a smaller offer.
Can you even cope with the extra work load that this may bring

 

[SimonG]

Thing is, as soon as he stops paying checkatrade its all gone. They wipe the lot. Its probably worth something but not 83 plus another 13 or 14 a week for checkatrade.

What happens if you feck something up big style, not saying you will, somebody will want to take the company to court. Its still his company?

 

[SimonG]

Not trying to be a tw@t just playing devils advocate. Might be a real good earner, but maybe not at that price.

 

[oz-plumber]

The only way it will work is if you buy his business.
You get the phone number(s), and everything associated with his business.

If his landline no. is his home no. then I wouldn't bother paying a great deal.

A contractor I knew who recently retired, wanted to sell me his customer list, business landline no. and mobile no.

He wanted way too much for his business and I don't think he ended up selling it to anyone.
At the end of the day - He was the business, he's retired, and so has his business effectively.

The work just gets passed onto everyone else.

 

[Ray Stafford]

I would be very surprised if Checkatrade permitted it, (if they found out). It makes a nonsense of their sales proposition and risks destroying their reputation. They don't sell leads. They monitor reputation - or what we used to call "goodwill".

Would you buy pictures of other company's intallations, and put them on your website as your own work?

How would you feel if you chose to use a supplier based on their trust-pilot or trip-advisor score, only to find that the reviews those scores were based on had come from people reviewing other companies, and had just been bought?

If customers find out what you are doing, I think they will give you terrible check-a-trade review, thus destroying the whole purpose of the enterprise.

The only way to legitimately do this would be to buy his whole business.

 

[oz-plumber]

Would you buy pictures of other company's intallations, and put them on your website as your own work?

Why not - some of our installs are on other company's websites.

One install we did was even put in a product brochure.