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How to price round for sale?


DangerousBrian

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DangerousBrian

Hi,

This is my first time posting on this forum, I'm actually not involved in the window cleaning industry myself, but it's been in my family for a lot of years, also spent plenty time trawling through these forums for ideas over the years. ūüôā

I tend to get dragged into calculating spreadsheets but that's where my remit ends.

At the moment it's just a portion of work that we'd be looking to sell in the north west area (Warrington/St Helens)

Work is a mix of houses, local pubs/bars etc, houses is monthly work with the bars/shops etc mainly done every 2 weeks.

Turnover is just shy of £14k per year and based on 2 lads @ a rate of £10 per hour makes just shy of 8k gross profit per year and a conservative estimate of 26hrs to complete the work with the 2 lads.

Looking to sell the work only with no equipment, but I literally have no idea of calculating it's value.

Any advice appreciated.

Thanks.

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Part Timer

Just so I get this right, are you saying it takes 2 lads 26 hours, 52 hours combined, a week to generate £14k a year turnover or is it a combined 26 hours. Or is it based on monthly hours that are combined or total?

 

Usually depending on type and price of work you are looking at anything between 3 and 10 times monthly turnover. The figures you have given don't appear to add up so a bit of clarity would help. However selling shop and bar work in todays climate would be fairly hard in my mind. 

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DangerousBrian
13 minutes ago, Part Timer said:

Just so I get this right, are you saying it takes 2 lads 26 hours, 52 hours combined, a week to generate £14k a year turnover or is it a combined 26 hours. Or is it based on monthly hours that are combined or total?

 

Usually depending on type and price of work you are looking at anything between 3 and 10 times monthly turnover. The figures you have given don't appear to add up so a bit of clarity would help. However selling shop and bar work in todays climate would be fairly hard in my mind. 

Hi,

I'm basing this on per month combined since at the moment there's 2 employees doing the work. For 1 bloke 52hrs per month to turnover £1200 per month.

The hours are very conservative based on a much larger amount of work of around 120k in turnover, so the 26hrs was also taking into account travel time between other work that needed to be done, 1 experienced person doing this by themselves I don't doubt could complete it in less, maybe 45hrs, the emoloyees who currently do the work are not the hardest of workers or the most experienced to be honest with you.

The round has been established around 25yrs 

Retirement planning and less stress is the reason for sale.

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So roughly that’s £23 per hour ?... price will be dependant on many things , how compact is the work ,what type of properties are they , 2,3,4 storey etc , how do the customers pay , but unfortunately a round is only worth what someone is willing to pay , I do think at this time the shops , pubs etc are  difficult one  to sell who knows if and when they will re open . Ime guessing it must be worth 4x monthley turnover . It’s rare fir stuff to sell for less . 

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Part Timer

I'm assuming it must be a traditional round then as they are poor numbers for a WFP round, even for the North. I work in the NE and fully understand the prices are lower than the south. As I said originally I wouldn't, currently, price the pubs / shops as a saleable asset. When these places do open up again then as @Pjj says between 4 and 5 times monthly turnover.

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6 minutes ago, Part Timer said:

I'm assuming it must be a traditional round then as they are poor numbers for a WFP round, even for the North. I work in the NE and fully understand the prices are lower than the south. As I said originally I wouldn't, currently, price the pubs / shops as a saleable asset. When these places do open up again then as @Pjj says between 4 and 5 times monthly turnover.

He is unsure of time taken to do the work, I based that figure on the 52 hours if it was done quicker then it would be higher but for me a minimum of £30 per hour per man  would be be the lowest I would work for preferably £45 per person per hour upwards 

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DangerousBrian

Great, thanks for the help.

Higher than £30 per hour per man? Not sure where abouts in the country you are but maybe it's different around here,  as an example, out of 50 bigger jobs there's only 8 that break the £30 per man per hour that's including commercial stuff.

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36 minutes ago, DangerousBrian said:

Great, thanks for the help.

Higher than £30 per hour per man? Not sure where abouts in the country you are but maybe it's different around here,  as an example, out of 50 bigger jobs there's only 8 that break the £30 per man per hour that's including commercial stuff.

Ime in the south west £30 per hour would be our bare minimum £45+ per hour per man is a normal figure we aim for and achieve most of the time on domestic , commercial many times that figure on our best work , some of which is on hold at the moment . Are you trad or wfp ?. That makes a big difference to potential earnings .

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DangerousBrian
1 minute ago, Pjj said:

Ime in the south west £30 per hour would be our bare minimum £45+ per hour per man is a normal figure we aim for and achieve most of the time on domestic , commercial many times that figure on our best work , some of which is on hold at the moment . Are you trad or wfp ?. That makes a big difference to potential earnings .

All wfp on domestic & commercial, on the commercial the external always seems to be very good margin but seems to be the interior stuff that's the killer for overall margin on the jobs.

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Just now, DangerousBrian said:

All wfp on domestic & commercial, on the commercial the external always seems to be very good margin but seems to be the interior stuff that's the killer for overall margin on the jobs.

Ok , we do do some internals on commercial but not a lot , mainly communal areas and doors/ stairwells , on domestic just to give you an idear we do  a lot of Maddern estate 3 bed semis at £10 a go I clean between 4-6 per hour the guy who’s with me does 4-5 so you can see the potential earnings per hour we have a weeks work ware we only go half a mile round one estate and move the van 3-4 times a day if work  is compact evan at low prices the amount earns can be very good .

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Part Timer
5 minutes ago, DangerousBrian said:

All wfp on domestic & commercial, on the commercial the external always seems to be very good margin but seems to be the interior stuff that's the killer for overall margin on the jobs.

That's why I've  got very little internal work. I have one big quarterly internal that pays £210. Quoted very high because I didn't want it, takes less than 4 hours from getting there to pulling away.

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DangerousBrian
28 minutes ago, Part Timer said:

That's why I've  got very little internal work. I have one big quarterly internal that pays £210. Quoted very high because I didn't want it, takes less than 4 hours from getting there to pulling away.

It does seem to be a bit of a ballache, crikey the £200 to £1k mark seems to be the majority of our jobs, then some anywhere up to the 3k range, plus side is the lads turn up and that's the 1 job for the day, or maybe it's the same site for 3 days straight, negative has turned out to be the internals seem to pay less than domestic, by quite a margin.

The most frustrating thing is you know these companies are making plenty money sat in swanky offices but then pull their face over an annual 3% price increase, I've never understood, they can be buildings that they pay millions to build, or 15/20k per month to rent, but then won't pay to keep them clean.

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Part Timer
7 hours ago, DangerousBrian said:

It does seem to be a bit of a ballache, crikey the £200 to £1k mark seems to be the majority of our jobs, then some anywhere up to the 3k range, plus side is the lads turn up and that's the 1 job for the day, or maybe it's the same site for 3 days straight, negative has turned out to be the internals seem to pay less than domestic, by quite a margin.

The most frustrating thing is you know these companies are making plenty money sat in swanky offices but then pull their face over an annual 3% price increase, I've never understood, they can be buildings that they pay millions to build, or 15/20k per month to rent, but then won't pay to keep them clean.

I bump into the Sales Director of a multi million pound turnover cleaning company, based in Derby, regularly when I'm working in Cambridge as he stays in the same hotel as me. One day he said "we need to have a meeting as we have a lot of work down here and you can have some if you want" 

When I said we don't do internals his expression changed and asked why. "Because we earn 2 to 3 times as much working outside" Seen him quite a few times since and no mention of a meeting.

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