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Old 06-04-2016, 09:48 AM   #1
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Question can you sell a painting business?

Guys...this fellow named Terry asked for help today.

Here's what he asked...

"Can you point me in the direction that I need to go in to start the process of selling my business. I feel it is worth a lot due to the 22 years I have put into it, and the great work I put into the name and integrity of this business.

"I feel someone can use my hard work to profit nicely, can you help me? Thank You. Terry"

Here's what I told him:

"Selling a painting business is very, very challenging for most owners Terry.

"You’ll need to build systems and manuals for the incoming owners, make certain you’ve reconnected and monetized your in-house customer lists, and prepared financial statements that will pass muster with banks if the purchaser will be using SBA or other financing.

"Frankly, this is a L-O-N-G discussion because so many things need to happen to MAXIMIZE your return.

"Yes, you can quickly cash-out for a bargain-basement price to someone (maybe $10,000 more than your equipment is worth), but that would be a waste of 22 years.

That's a snippet of the advice Terry needs to hear, but there's a lot more to it than that.

Selling your painting business will be the largest financial transaction of your life if you play your cards right. If not, you'll get "peanuts" for decades of hard work - if you get anything at all.

Do you hope to sell your painting business one day? If so, reply and let me know.

I never want to hear of a single painting contractor "walking away" from a painting business without a reward for years of hard work. What say you?

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Old 06-04-2016, 12:19 PM   #2
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Is there really that much equity value in a one man painting operation, with temporary help, given the saturation of licensed and non licensed contractors offering homeowners such a wide price range?

I'm sure most self employed painters would jump at ten grand if offered for their businesses, provided they had other employment options and preferably a spouse who worked and carried the benefits.

However, it's an obvious no brainer for a large painting company to consider asset and client equity when evaluating their worth in a transaction. I'm just not sure it's the biggest financial transaction a one man show might face. Maybe purchasing a new company truck might be the biggest purchase for many.
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Old 06-04-2016, 12:29 PM   #3
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Is there really that much equity value in a one man painting operation, with temporary help, given the saturation of licensed and non licensed contractors offering homeowners such a wide price range?

I'm sure most self employed painters would jump at ten grand if offered for their businesses, provided they had other employment options and preferably a spouse who worked and carried the benefits.

However, it's an obvious no brainer for a large painting company to consider asset and client equity when evaluating their worth in a transaction. I'm just not sure it's the biggest financial transaction a one man show might face. Maybe purchasing a new company truck might be the biggest purchase for many.
I'd hope to get more than 10 grand just for our tools and equipment. Also selling your client list sounds like a good idea. But will your old clients think the same, will they get the same care and quality. I'm sure some one who sells out wouldn't care, those who want big bucks to sell out should care.

So on this note any one want to buy me out for a mere $500,000.00? This comes with close to $75,000+ worth of tools, equipment and vehicles. plus our client list for another $100,000.
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Old 06-04-2016, 12:36 PM   #4
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I'd hope to get more than 10 grand just for our tools and equipment. Also selling your client list sounds like a good idea. But will your old clients think the same, will they get the same care and quality. I'm sure some one who sells out wouldn't care, those who want big bucks to sell out should care.

So on this note any one want to buy me out for a mere $500,000.00? This comes with close to $75,000+ worth of tools, equipment and vehicles. plus our client list for another $100,000.
Does it come with at least one painter?
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Old 06-04-2016, 01:37 PM   #5
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One man operations do not have much value to sell. If you have employees there is potential for some but even than not always.

I have always figured assets shop tools vehicles plus 2-3 times net profit after everyone is paid a wage including any owners. To many times I think the owners think their pay is profit but its not really. You got to figure out what it would cost to replace yourself and than what is left is company profit.

This is at least what I have read in many books but I could be way off.
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Old 06-04-2016, 01:41 PM   #6
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I think there are a few people on here that have sold. I think if an employee buys it that really helps with the customer base and continuity. I guess it depends on the size of the company. If you got 100 employees and doing commercial and industrial it probably doesnt matter but if you got 5-30 employees than I would think it matters to the customers some.
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Old 06-04-2016, 01:42 PM   #7
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I believe the most significant asset of any painting operation, is the help. But selling people is illegal in this country. Isn't it?
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Old 06-04-2016, 01:48 PM   #8
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I believe the most significant asset of any painting operation, is the help. But selling people is illegal in this country. Isn't it?

Well that is assuming most the people stay working but why wouldnt they. If all the sudden the company you worked for said we got new ownership would you pick up and run? Companies sell all the time and the employees stay I realize painting companies are smaller. Now if all you got is temp workers again that different.
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Old 06-04-2016, 01:55 PM   #9
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Well that is assuming most the people stay working but why wouldnt they. If all the sudden the company you worked for said we got new ownership would you pick up and run? Companies sell all the time and the employees stay I realize painting companies are smaller. Now if all you got is temp workers again that different.
Don't most business acquisitions give employees of the acquired company, the option to stay, or leave?

Unless a small one man paint company owner believes he's hit the mother load of clients, and many will claim they have as part of their innate competitive nature, most likely he'll accept a few bucks from one of his helpers and move on out of painting. IMO.

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Old 06-04-2016, 01:58 PM   #10
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I think you always have the option to leave it is America. When Exxon bought mobile do you think they were worried honestly they probably let people go. aol bought time warner and so on I realize those are big companies but again if you went to work monday and they told you we sold the company here is the new owner would you pack up and leave?
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Old 06-04-2016, 02:04 PM   #11
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if you went to work monday and they told you we sold the company here is the new owner would you pack up and leave?
I probably wouldn't leave immediately. But I would be very concerned we were sold in the first place. Particularly, if we weren't publicly traded.

Now, if my employer was in fact sitting on a clientele mother load, I may just stick around. But what mom and pop shop really is where pop isn't micro managing every move. Now that would drive me away!

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Old 06-04-2016, 02:08 PM   #12
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And if after a few months of looking for another job you figured out the new owners were good and kept work flowing than you are back to just working. I'm not saying its easy to do thats why most painting businesses dont sell but most are not big enough to be worth it.
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Old 06-04-2016, 02:12 PM   #13
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And if after a few months of looking for another job you figured out the new owners were good and kept work flowing than you are back to just working. I'm not saying its easy to do thats why most painting businesses dont sell but most are not big enough to be worth it.
Yea. I agree. The OP is promoting a product that may be better suited for larger organizations than Willy's wild one man band paint show.
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Old 06-04-2016, 02:14 PM   #14
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Yea. I agree. The OP is promoting a product that may be better suited for larger organizations than Willy's wild one man band paint show.

Oh I agree. One man shows are not really worth anything. I dont know how large the company you work for is. But honestly a small company of 5 or so can have some value but honestly selling it to your foreman or top painter is your best chance than I think. I think once you get over 30 or 40 there could be some real value to outside people. This is just my thought I could be way off.
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Old 06-04-2016, 02:18 PM   #15
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Oh I agree. One man shows are not really worth anything. I dont know how large the company you work for is. But honestly a small company of 5 or so can have some value but honestly selling it to your foreman or top painter is your best chance than I think. I think once you get over 30 or 40 there could be some real value to outside people. This is just my thought I could be way off.
It seems those are the big fish the OP wants. But depending on the cost of the Core 5 System the OP is promoting, a smaller outfit would need to assess that need verses being able to manage and assess all of their assets without the need for a consultant or management program.

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Old 06-04-2016, 02:24 PM   #16
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Oh I dont doubt that the original post is trying to sell something. I guess I was taking your questions more directed toward the value or viability of a company selling rather than him and his services. I guess I miss interpreted your questions. I agree most people on this site do not need his services in my opinion.
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Old 06-04-2016, 02:27 PM   #17
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Just curious CApainter and I'm sure I could search on here and find out but what do you do at your company and what do they specialize in. I always appreciate your insight on topics when I do read on here and I guess that is something I have never read.
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Old 06-04-2016, 02:30 PM   #18
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Oh I dont doubt that the original post is trying to sell something. I guess I was taking your questions more directed toward the value or viability of a company selling rather than him and his services. I guess I miss interpreted your questions. I agree most people on this site do not need his services in my opinion.
I don't doubt there is an intrinsic value in anyone's efforts to create something. It's when they start asking exorbitant monetary value for the ordinary and mundane where it gets a little ridiculous. I mean, look at any Monet. It's obvious the guy had problems seeing. But, his paintings sell for millions. Go figure.
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Old 06-04-2016, 02:32 PM   #19
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Or Picasso over 100 million for a painting for something that looks goofy crazy.
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Old 06-04-2016, 02:35 PM   #20
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Just curious CApainter and I'm sure I could search on here and find out but what do you do at your company and what do they specialize in. I always appreciate your insight on topics when I do read on here and I guess that is something I have never read.
I'm just a bitter painter that never worked his way into management. And, I think I can do a better job at managing than most. But I'm happy where I'm at these days, just taking on industrial, or architectural projects, primarily alone, and spending the early Autumn season of my career applying my craft, that by the way, is still in the making after thirty plus years.
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