Taylor Made for Townhome Associations
Townhome Association Lawn Maintenance
Whatever your goals are for your homeowner association, commercial building or multi-family property, Taylor Made delivers and exceeds the results you and your clients expect. Working together, you can rest assured that we’ll develop a plan that brings out the full potential of your natural site while keeping your budget in mind.. Hire the company you can trust, Taylor Made Landscape Management.
We take care of all of the details so you don’t have to. We start the process by listening to your goals. We develop a plan that enhances the beauty of your property. Our professional scheduling of comprehensive landscape services are performed on time, no matter what the weather is doing. We become your eyes and ears on the property. We’re vigilant about discovering potential issues before they become problems.
You will have an active partner when you decide to work with us. We’ll design and create a valuable, vibrant, living landscape.
As a partner, we’re not satisfied until you’re completely satisfied with every service. Your landscape will benefit from the expert care on a timely basis. Your property reflects your values. Clients, tenants and prospective owners base a large part of their opinion of the property before they walk inside. We’ll work with you to keep tenants and clients happy and to attract and retain potential prospects.
We’re confident that we can meet and exceed your landscape maintenance goals, regardless of the size of your association. We also know you expect a dependable, trustworthy company that continually provides solutions. Our creative staff will deliver cost effective solutions that will keep you, your board members and residents happy.
Wednesday, October 8, 2008
Monday, June 16, 2008
Building Rain Gardens in Minnesota, Steve Hoogenakker
The Raingarden: A CIC’s contribution to cleaner water
By Steve Hoogenakker, Taylor Made Landscape and Jenn Morrow, Top Notch Tree Care
Many folks are not aware that the rain that runs to our storm sewers does not go to the municipal plant for treatment. It used to, but as growing communities increased pressure on treatment plants, cities nationwide disconnected storm sewers and routed them directly to the nearest lake or stream. In Minnesota, pride in our natural resources is strong, and residents are willing and eager to do their part to protect water quality.
Raingardens are a fabulous way for CIC’s to protect water quality. It is a garden or landscaped area with a very slight depression (usually 6-8 inches). A raingarden is designed to capture stormwater from rooftops, driveways and even streets, allowing it to soak into the ground along the deep root channels of beautiful plants (some native and some conventional).
Some of the benefits to CICs include an aesthetically appealing landscape feature, increased bird and butterfly activity, and credit for reduction of stormwater -which some cities are beginning to charge fees for! The list of benefits to the environment is long.
The current system of storm sewer pipes contributes largely to flooding and poor water quality in all water bodies. The water runs off so fast, our natural systems cannot absorb it. Prior to urbanization, stormwater soaked into the ground. Some of it made it all the way down to aquifers and some of it flowed slowly and laterally through the ground to lakes and streams. By the time rainwater reached a surface water, it was scrubbed clean by soil and microbes and cooled to the temperature that fish and other aquatic critters enjoy. Gutters and pipes allow over-heated stormwater to flush all the pollutants that collect on impervious surfaces to water bodies that are not able to treat or absorb the impurities nor are they able to accept the sheer volume – leading to serious flooding. Raingardens begin to repair the natural mechanism that slows, cleans and cools stormwater.
What about all the stormwater ponds that CICs have, aren’t those meant to protect water quality? The quick answer is, yes, they were originally intended as an answer to the Clean water Act mandate that stormwater be treated on site in new construction over five acres. They do keep stormwater and pollutants out of local lakes and streams, unfortunately they merely collect and concentrate those pollutants. They, just like natural ponds, do not have the capacity to treat stormwater. In addition they often become eyesores.
To intercept the stormwater that is piped directly into storm ponds (and would not be served by a buffer), raingardens can be installed in the path of down spouts and near the curb with curb cuts. These curbside raingardens allow water from streets to flow into the garden. They are designed to over flow back into the street if their capacity is exceeded, not into the lawn. All raingardens are designed to be dry within 24-36 hours after a storm to keep mosquitoes from breeding in them. Mosquito larvae need seven to twelve days of standing, stagnant water to mature. Raingardens actually act as ‘traps’ when mosquitoes lay eggs in them and the water drops since they cannot mature! In contrast, raingardens provide vital habitat for many desirable critters like birds and butterflies.
The city of Burnsville recently studied the effectiveness of raingardens. They installed 17 residential raingardens to capture street and roof runoff and measured an 82% reduction in runoff in 2004! They measured a 90% reduction in 2005 and a 93% reduction in 2006- illustrating that as the plants mature (and the root structures create more channels) the infiltration rate increases! The city of Maplewood has actively employed raingardens in city street reconstruction projects for over 10 years! Cities across the country are embracing simple raingardens to address serious stormwater problems including Kansas City, MO (with its 10,000 raingarden program launched in 20060, Portland OR and Chicago IL. The ‘ground work’ has been laid and practitioners have learned how to make raingardens work and look beautiful!
With both raingardens and shoreline plantings, proper plant selection and installation and maintenance are critical to their success. There is a wide pallet of colors and textures that will tolerate the water fluctuations common to these landscapes. Raingardens can be designed to be virtually indistinguishable from conventional gardens and landscapes while performing an important community service! Be sure to consult a contractor that is familiar with native plants and shorelines when pursuing projects like these.
Even if raingardens and ponds are not part of your landscape, a native garden can achieve environmental goals and can be incorporated into any plan. A simple butterfly garden can bring bright bold colors and delightful wildlife to an outdoor living space. They require less water and no fertilizers or weekly mowing and in that way, conserve water and other resources as well as protect water quality!
If your CIC is searching for ways to help the environment, they need not look far. Take a close look at how stormwater is ‘treated’ in your community as ask, ’is there a better way?’.
Jenn Morrow is currently is an Ecologist with Urban Ecosystems, a division of Top Notch Treecare. Jenn feels that a properly designed and installed raingarden is an inexpensive investment in our future. Jenn can be reached at 763-253-8733, or at Jmorrow@topnotchtree.com
Steve Hoogenakker is landscape consultant/contractor with 20 years experience working with cic properties and can be reached at 763-213-2410 or Steve@Landscape.Pro
Steve Hoogenakker
Showcase Landscape
Steve Hoogenakker has 20 years in the landscaping and leadership field. He can be reached by email at Steve@Landscape.Pro. Much of this information can be found in the excellent book, Crucial Conversations.
Steve Hoogenakker, MHA, CAI, CIC Midwest, MNLA, PLANET, MTFG, Showcase Landscape
This article can be reprinted if all of the authors information is left unaltered.
By Steve Hoogenakker, Taylor Made Landscape and Jenn Morrow, Top Notch Tree Care
Many folks are not aware that the rain that runs to our storm sewers does not go to the municipal plant for treatment. It used to, but as growing communities increased pressure on treatment plants, cities nationwide disconnected storm sewers and routed them directly to the nearest lake or stream. In Minnesota, pride in our natural resources is strong, and residents are willing and eager to do their part to protect water quality.
Raingardens are a fabulous way for CIC’s to protect water quality. It is a garden or landscaped area with a very slight depression (usually 6-8 inches). A raingarden is designed to capture stormwater from rooftops, driveways and even streets, allowing it to soak into the ground along the deep root channels of beautiful plants (some native and some conventional).
Some of the benefits to CICs include an aesthetically appealing landscape feature, increased bird and butterfly activity, and credit for reduction of stormwater -which some cities are beginning to charge fees for! The list of benefits to the environment is long.
The current system of storm sewer pipes contributes largely to flooding and poor water quality in all water bodies. The water runs off so fast, our natural systems cannot absorb it. Prior to urbanization, stormwater soaked into the ground. Some of it made it all the way down to aquifers and some of it flowed slowly and laterally through the ground to lakes and streams. By the time rainwater reached a surface water, it was scrubbed clean by soil and microbes and cooled to the temperature that fish and other aquatic critters enjoy. Gutters and pipes allow over-heated stormwater to flush all the pollutants that collect on impervious surfaces to water bodies that are not able to treat or absorb the impurities nor are they able to accept the sheer volume – leading to serious flooding. Raingardens begin to repair the natural mechanism that slows, cleans and cools stormwater.
What about all the stormwater ponds that CICs have, aren’t those meant to protect water quality? The quick answer is, yes, they were originally intended as an answer to the Clean water Act mandate that stormwater be treated on site in new construction over five acres. They do keep stormwater and pollutants out of local lakes and streams, unfortunately they merely collect and concentrate those pollutants. They, just like natural ponds, do not have the capacity to treat stormwater. In addition they often become eyesores.
To intercept the stormwater that is piped directly into storm ponds (and would not be served by a buffer), raingardens can be installed in the path of down spouts and near the curb with curb cuts. These curbside raingardens allow water from streets to flow into the garden. They are designed to over flow back into the street if their capacity is exceeded, not into the lawn. All raingardens are designed to be dry within 24-36 hours after a storm to keep mosquitoes from breeding in them. Mosquito larvae need seven to twelve days of standing, stagnant water to mature. Raingardens actually act as ‘traps’ when mosquitoes lay eggs in them and the water drops since they cannot mature! In contrast, raingardens provide vital habitat for many desirable critters like birds and butterflies.
The city of Burnsville recently studied the effectiveness of raingardens. They installed 17 residential raingardens to capture street and roof runoff and measured an 82% reduction in runoff in 2004! They measured a 90% reduction in 2005 and a 93% reduction in 2006- illustrating that as the plants mature (and the root structures create more channels) the infiltration rate increases! The city of Maplewood has actively employed raingardens in city street reconstruction projects for over 10 years! Cities across the country are embracing simple raingardens to address serious stormwater problems including Kansas City, MO (with its 10,000 raingarden program launched in 20060, Portland OR and Chicago IL. The ‘ground work’ has been laid and practitioners have learned how to make raingardens work and look beautiful!
With both raingardens and shoreline plantings, proper plant selection and installation and maintenance are critical to their success. There is a wide pallet of colors and textures that will tolerate the water fluctuations common to these landscapes. Raingardens can be designed to be virtually indistinguishable from conventional gardens and landscapes while performing an important community service! Be sure to consult a contractor that is familiar with native plants and shorelines when pursuing projects like these.
Even if raingardens and ponds are not part of your landscape, a native garden can achieve environmental goals and can be incorporated into any plan. A simple butterfly garden can bring bright bold colors and delightful wildlife to an outdoor living space. They require less water and no fertilizers or weekly mowing and in that way, conserve water and other resources as well as protect water quality!
If your CIC is searching for ways to help the environment, they need not look far. Take a close look at how stormwater is ‘treated’ in your community as ask, ’is there a better way?’.
Jenn Morrow is currently is an Ecologist with Urban Ecosystems, a division of Top Notch Treecare. Jenn feels that a properly designed and installed raingarden is an inexpensive investment in our future. Jenn can be reached at 763-253-8733, or at Jmorrow@topnotchtree.com
Steve Hoogenakker is landscape consultant/contractor with 20 years experience working with cic properties and can be reached at 763-213-2410 or Steve@Landscape.Pro
Steve Hoogenakker
Showcase Landscape
Steve Hoogenakker has 20 years in the landscaping and leadership field. He can be reached by email at Steve@Landscape.Pro. Much of this information can be found in the excellent book, Crucial Conversations.
Steve Hoogenakker, MHA, CAI, CIC Midwest, MNLA, PLANET, MTFG, Showcase Landscape
This article can be reprinted if all of the authors information is left unaltered.
How to put a value on your landscape business Part I
HOW TO BUILD, BUY OR SELL a LANDSCAPE MGMT COMPANY:
In the past 6 months, I’ve had a number of people ask me to advise them in valuing their business, or evaluate a business they’re considering purchasing. There’s a lot of interest and a lot of activity this year.
So, what’s a business worth?
To help you find out, you should follow three general rules.
1. Start planning TODAY! You never know when an opportunity presents itself, or when disaster strikes. Ideally, you’ll want at least 2-3 years planning before selling a business.
2. Hire a professional or ask an industry expert to help you
3. Maximize the guidelines listed below to bring the highest price.
The first place to look is your own business. This is a complex process, but here are the basics.
As a business owner, you should always be thinking of your company’s intrinsic value, and how you’ve achieved it. Most contractors look at the income statement (if they have one) at the end of the year and say “I made $100,000 net!” But, using the same financials, you might have actually increased the value of your company by $350,000, or reduced the value by $50,000. So, having the right information might mean a $400,000 swing in real value instead of $100,000 profit! Do you see how your daily decisions will be profoundly affected by this new knowledge?
You have assets that you can sell, but I’m here to tell you that you aren’t selling or buying “hard assets”. Heck, you can buy equipment anywhere, anytime. You’re really selling or buying “soft assets”; your ability to build a team, sell, market, satisfy, create relationships, forge loyalties, make a profit and grow the business.
In the Minnesota market, I would say that most businesses I’ve seen for sale are overpriced because somewhere, someone is saying “my company is worth one year’s gross sales” Some of this is encouraged by business brokers who don’t understand the green industry. They make a percentage off of the price of the sale, therefore, they encourage high pricing. If you’re going to use outside help, stay away from the brokers, at least at first.
Gross sales have little to do with the value, therefore, if your goal for 2008 is to grow the biz by 40%, then you could still decrease the value of the business, or even reduce it’s profits. Most companies who make the Inc. 500 fastest growing companies lose money! In the two years my companies would have made the Inc 500 list, we lost money.
Realize that businesses generally sell on multiples of earnings, which is much more complex than just profit!
In the past 6 months, I’ve had a number of people ask me to advise them in valuing their business, or evaluate a business they’re considering purchasing. There’s a lot of interest and a lot of activity this year.
So, what’s a business worth?
To help you find out, you should follow three general rules.
1. Start planning TODAY! You never know when an opportunity presents itself, or when disaster strikes. Ideally, you’ll want at least 2-3 years planning before selling a business.
2. Hire a professional or ask an industry expert to help you
3. Maximize the guidelines listed below to bring the highest price.
The first place to look is your own business. This is a complex process, but here are the basics.
As a business owner, you should always be thinking of your company’s intrinsic value, and how you’ve achieved it. Most contractors look at the income statement (if they have one) at the end of the year and say “I made $100,000 net!” But, using the same financials, you might have actually increased the value of your company by $350,000, or reduced the value by $50,000. So, having the right information might mean a $400,000 swing in real value instead of $100,000 profit! Do you see how your daily decisions will be profoundly affected by this new knowledge?
You have assets that you can sell, but I’m here to tell you that you aren’t selling or buying “hard assets”. Heck, you can buy equipment anywhere, anytime. You’re really selling or buying “soft assets”; your ability to build a team, sell, market, satisfy, create relationships, forge loyalties, make a profit and grow the business.
In the Minnesota market, I would say that most businesses I’ve seen for sale are overpriced because somewhere, someone is saying “my company is worth one year’s gross sales” Some of this is encouraged by business brokers who don’t understand the green industry. They make a percentage off of the price of the sale, therefore, they encourage high pricing. If you’re going to use outside help, stay away from the brokers, at least at first.
Gross sales have little to do with the value, therefore, if your goal for 2008 is to grow the biz by 40%, then you could still decrease the value of the business, or even reduce it’s profits. Most companies who make the Inc. 500 fastest growing companies lose money! In the two years my companies would have made the Inc 500 list, we lost money.
Realize that businesses generally sell on multiples of earnings, which is much more complex than just profit!
Sunday, February 24, 2008
Preparing Your Lawn for Spring Minnesota
Da Garden” If you have a personal garden, ‘tis the season to till it up. Consider doing a soil test yourself for best results. Here’s a little secret: Why does Miracle Grow grow 700 pound pumpkins? I know you don’t actually want a 700 pound pumpkin this fall, but if you want to give your garden every chance of providing pleasure or juicy tomatoes, then the secret is this: Most fertilizers carry 3 ingredients. Even if you ask the U of M, they’ll say. “Buy a 10-10-10”! This is the standard response for anyone in the industry, and it usually works Ok. BUT, there are 16 minerals needed for every plant to survive. Miracle Grow provides all 16! They might not be needed, but if just 1 or 2 are missing or weak your plants will suffer.
“Da Trees” Make sure that the tree wrap is removed from trees, look for split trunks or damage that might’ve happened from the early snow storm or from wind damage. If you know you have Ash Trees, which almost everyone has, there is a terrible menace out there this year. The Emerald Ash Borer. Once it’s on a property, can kill all the ash trees on a property in 1-3 years. There are links on http://www.townhome.pro/.
“Da Water” Irrigation system startups need to include replacing broken heads, and resetting the direction of heads so they cover the lawn, making sure they don’t blow over the freshly washed car and into the bedroom window. If you don’t have a system, I would be happy to recommend a professional, or design one myself..Finally, work with your contractor. It’s in his/her best interest to have a wonderful, living landscape too. If your association does a lot of work itself, or if you’re just curious, call or write a Master Gardener volunteer. It’s free, and the link is on your website that is just being created; http://www.townhome.pro/. This article written by Steve Hoogenakker of Taylor Made Landscape.He has 20 years experience in landscaping.
This article may be reprinted as long as the contact information is left in the new article
Friday, February 22, 2008
Preparing Your Lawn for Spring Part I
YOUR LANDSCAPE – WHAT YOU DON’T KNOW COULD KILL MILLIONS
That’s right. As a homeowner, you’re responsible for millions of living organisms. You’re the “Jack Bauer” of the show “24” protecting millions of innocent lives!Grass plants, ornamentals, trees, annual flowers and shrubs. Your decisions also affect insect and biotic populations. Most importantly, you’re in control of how your landscape affects you and your family personally. The best way to make the most of your living investment is knowledge and of course, action!
At the end of this article, I’ve included a link to www.Townhome.Pro, where I’ve added links for your lawn, landscape, trees and garden. This website is dedicated exclusively for MHA members at this time.
Let’s get started!
“Da Lawn”
We’ll start with the lawn. It’s very important to have a thick, healthy lawn. Why? My daughter plays soccer and I shudder everytime she gets knocked down. (I never cheer when she knocks someone else down.) When kids play on your lawn, or when elderly residents walk in it, a thick lawn protects their skin and joints. A thick lawn also prevents weeds from coming up, reducing the need for pesticides. So, what can we do in the spring to get there?
First, write down your thoughts about last years’ turf. What improvements would you like to have seen? Then “spring” into action. If you have a lawn contractor, discuss fertilization options with him/her. Are they applying 2-3 pounds of Nitrogen per year? Nitrogen has a direct relationship to the color of the lawn. If the lawn isn’t thick and green, ask them to do a soil test, or you can do one using the easy instuctions on the website. (Cost $15.00 plus postage) Do they use slow release or fast release fertilizer? Quick release fertilizers give the lawn a quick greenup and are cheaper, but they lose their color after 2-4 weeks. If you’re getting 3 applications per year, with normal release fert, you get 4 weeks of food and rapid growth followed by 4 weeks of partial starvation. Using slow release feeds gradually, and keeps the lawn growing at a more regular pace. Ask your contractor if he likes double cutting and bagging grass clippings, if he says yes, I owe you a $5.00 gift certificate to Caribou Coffee. When he says no, tell him that using slow release will cut down on rapid flush growth, and cut down the need for a lot of extra labor. Everybody wins!
There is bound to be some winter salt or plow damage too. These areas need to be seeded or sodded right away. I recommend bringing black dirt in if needed and if using seed, use blends, such as kentucky bluegrass and perennial rye for sunny areas, and fine fescue, perennial rye and bluegrass for shady areas. If seeding, expect weeds. Crabgrass control can’t be applied to these areas unless you use Siduron (Tupersan), but broadleaf controls can be used after the seeded area is mowed twice. Seed or Sod, water a couple of times per day for short periods of time.
Steve Hoogenakker provides a solid, common sense approach to solving problems and answering questions relating to business management, leadership, consumer loan products and landscape and lawn problems and solutions. Steve has 20 years in the landscaping and leadership field. He can be reached by email at Steve@Landscape.Pro. Steve Hoogenakker, MHA, CAI, CIC Midwest, MNLA, PLANET, MTGF, Showcase Landscape, Minnesota, Delano Steve loves his wife Teri Hoogenakker and their kids, Paul Hoogenakker, Kirsten Hoogenakker and Gerrit Hoogenakker very much.
Publisher’s Directions: This article may be freely distributed so long as the copyright, author’s information, disclaimer, and an active link (where possible) are included. Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. Steve Hoogenakker will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.
That’s right. As a homeowner, you’re responsible for millions of living organisms. You’re the “Jack Bauer” of the show “24” protecting millions of innocent lives!Grass plants, ornamentals, trees, annual flowers and shrubs. Your decisions also affect insect and biotic populations. Most importantly, you’re in control of how your landscape affects you and your family personally. The best way to make the most of your living investment is knowledge and of course, action!
At the end of this article, I’ve included a link to www.Townhome.Pro, where I’ve added links for your lawn, landscape, trees and garden. This website is dedicated exclusively for MHA members at this time.
Let’s get started!
“Da Lawn”
We’ll start with the lawn. It’s very important to have a thick, healthy lawn. Why? My daughter plays soccer and I shudder everytime she gets knocked down. (I never cheer when she knocks someone else down.) When kids play on your lawn, or when elderly residents walk in it, a thick lawn protects their skin and joints. A thick lawn also prevents weeds from coming up, reducing the need for pesticides. So, what can we do in the spring to get there?
First, write down your thoughts about last years’ turf. What improvements would you like to have seen? Then “spring” into action. If you have a lawn contractor, discuss fertilization options with him/her. Are they applying 2-3 pounds of Nitrogen per year? Nitrogen has a direct relationship to the color of the lawn. If the lawn isn’t thick and green, ask them to do a soil test, or you can do one using the easy instuctions on the website. (Cost $15.00 plus postage) Do they use slow release or fast release fertilizer? Quick release fertilizers give the lawn a quick greenup and are cheaper, but they lose their color after 2-4 weeks. If you’re getting 3 applications per year, with normal release fert, you get 4 weeks of food and rapid growth followed by 4 weeks of partial starvation. Using slow release feeds gradually, and keeps the lawn growing at a more regular pace. Ask your contractor if he likes double cutting and bagging grass clippings, if he says yes, I owe you a $5.00 gift certificate to Caribou Coffee. When he says no, tell him that using slow release will cut down on rapid flush growth, and cut down the need for a lot of extra labor. Everybody wins!
There is bound to be some winter salt or plow damage too. These areas need to be seeded or sodded right away. I recommend bringing black dirt in if needed and if using seed, use blends, such as kentucky bluegrass and perennial rye for sunny areas, and fine fescue, perennial rye and bluegrass for shady areas. If seeding, expect weeds. Crabgrass control can’t be applied to these areas unless you use Siduron (Tupersan), but broadleaf controls can be used after the seeded area is mowed twice. Seed or Sod, water a couple of times per day for short periods of time.
Steve Hoogenakker provides a solid, common sense approach to solving problems and answering questions relating to business management, leadership, consumer loan products and landscape and lawn problems and solutions. Steve has 20 years in the landscaping and leadership field. He can be reached by email at Steve@Landscape.Pro. Steve Hoogenakker, MHA, CAI, CIC Midwest, MNLA, PLANET, MTGF, Showcase Landscape, Minnesota, Delano Steve loves his wife Teri Hoogenakker and their kids, Paul Hoogenakker, Kirsten Hoogenakker and Gerrit Hoogenakker very much.
Publisher’s Directions: This article may be freely distributed so long as the copyright, author’s information, disclaimer, and an active link (where possible) are included. Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. Steve Hoogenakker will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.
Wednesday, January 16, 2008
Landscape Acquisitions
I can help, I've done acquisitions for lawn care/landscaping. If you want a BUSINESS VALUATION, below is a very real formula. If you want a REAL LIFE VALUATION, a lot of times it's two guys over coffee, going over customers and employees, then they agree on a percentage of revenue (20-100%) plus maybe buying out some equipment. Short Answer:I'd start out with a number of mows per client, so I'd offer to pay the previous owner the payments received for the first 2-3 mows. You can do it the week after you mow them, or if you wanna be a nice guy, you could pay them for 2-3 mows once they sign your contract. If that isn't good enough, below is very valuable information on larger business acquisitions:Answer that imparts wisdom for this and future transactions:A REAL VALUATION, which you should run at least once per year so you know what your business is worth goes like this:Technically, it's based on EBITDA, which is Earnings Before Interest, Taxes, Depreciation and Amortization. If you would like to know more about that, just reply and I'll give you a better explanation that should be useful. It's basically a "cash flow" formlula. You take your profits, depreciation, interest expense, and any of your pay that is "excessive" to what you do. So, if you're running a crew and making $80,000, you could put $40,000 back towards cash flow because a new owner would have to hire on a new foreman to run that crew:Formula works like thisProfit $20,000Depreciation $30,000 Interest Expense $8,000Excessive Owners Income $40,000 Total: $98,000. Then you use a multiplier on this EBIT or EBITDA formula. Something like 2.5 to 3.5, so the business would be valued at $250,000 to $350,000. In this sort of equation, the value of the equipment is negotiated. IT can be rolled into the price, or the net value can be added, or the buyer may ask that the equipment be paid off from the $350,000 and be free and clear. The way to keep this clear is to think from the buyers view is:I'm going to buy a business for $300,000. I expect to earn $98,000 per year or get 33% for my money which is a lot better than Wall Street!Other factors, it's based on:1. Size of company. I would rather buy companies over $750,000 because there has to be some management or systems in place, but a business broker friend of mine says he finds many many more buyers of businesses of around $200,000-$400,000. We think it's because it's easier for another contractor to add that much service to his present line. 2. Type of billing. Since we're in the Lawn Maintenance forum, I'll assume that we're talking about mowing. "recurring billing" is what brings in a bigger amount. When you have solid monthly billing, this is something that buyers can count on more than one time landscape sales. Commercial usually worth more than Single Family Residential. 3. Spread out customer base. A Customer base that doesn't consist of 3 clients that make up half of the billing is going to scare some people away. A base with 50 clients with no one client making up more than 25% is pretty solid. This is also something that banks financing your company, or financing a sale4. Growth. Most buyers prefer some decent, but not excessive growth. A 10 year company growing 15% every year sounds pretty solid to me with probably a solid customer base. 5. Gross Profit margins. Anyway, if you have other questions, let me know, Best of Luck!Steve Hoogenakker
Tuesday, January 15, 2008
Lawn Site Forum Minnesota
Hi guys, We need to get Minnesota back on the map in this forum. Are there any problems or questions that anyone is having in Minnesota???How did everyone do with the last two snowfalls? Are you ready for Spring? Guesstimate of first mowing in the Twin Cities? I say April 23rd. Steve
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