Mike Draper
Can you sell your renovation business?
Canadian Contractor How-to Business CommercialRecently, I worked with a renovation contractor in Edmonton who sold his business for $500,000. In order to do that, he had to make sure that his business was working well without him. That's the key to being able to sell your business: set up systems, delegate, and get out of the day-to-day.
Does your renovation business provide you with a pension? Probably not, right? So how do you make sure that, one day, you have enough money to retire?
Most renovation companies I see make barely enough money to support the contractor today, never mind stockpiling money for retirement.
One solution to this problem is, of course, to sell your business one day.
Impossible, you might say. You are the business, you might argue, and not too many of your current clients are going to want to give their business to someone else who might, theoretically, buy your business.
If that is your approach, you have been thinking about your business the wrong way. Renovation businesses can be sold and in the next issue of Canadian Contractor I will be writing about a contractor in Edmonton who sold his business for half a million bucks.
How did he do it? He implemented systems in his business, so that the business wasn’t all about him. He delegated, he got himself out of tending to the business 6 days a week, 12 to 14 hours a day. By changing the business so that it could run without him, he had something to sell to the new owner.
At Renovantage, our definition of a successful business is: A commercial, profitable enterprise, that works without you.
If you can turn your reno business into a commercial, profitable enterprise that works without you, you, too, can sell your business for a lot of money, when you wish, and enjoy your retirement.
Next week, check this space for the full story of how you can do this, too.
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Hello Mike, congrats for your text…and looking fwd to the one next week.
We’re about to launch our new company in Montreal and we’re looking for credible references with respect to:
A- Financial ratios that we should target (i.e.: remuneration vs revenues, EBITDA, etc
B-the main criteria that we should target when planning the planning of this newco: focus on profits or growth in view of reaching the maximum value of our shares.
Would you have any reference books or articles to give us?
Thanks
Jacques
Mtl
after 23 1/2 years we sold our plumbing service/contracting business
it was not easy
but I should have paid my lawyer more and not used a broker to handle the deal
most shops just slow down get old and stop
that was never my idea
Harry, congratulations on successfully selling your business! Too many contractors don’t get to enjoy such a transaction, and I hope you enjoy the next phase of your life. If you’d like to talk about how you sold your business, I am sure our readers would be interested. Please contact me, if you would like to share more, at spayne@canadiancontractor.ca.