I’ve had a few pet sitters in the last few months contact me wanting to know how much they can make by selling their pet sitting business.
The answer varies depending upon the value of your business (and I’m not just talking profit here). The standard amount for a business sale is 1.5 to 2 times the average gross earnings of the past 3 years.
Service businesses can sometimes receive a lower sale price because you are selling a service vs. tangible items.
However, with service-based businesses you can often get that amount too (and sometimes more) if:
You can prove that clients don’t associate YOU with the business (if you leave, they may leave too). If your business name is Jennifer’s Pet Care you are going to have a harder time selling your business than Cozy Critters Pet Care might. Also if you have managers managing your business, you are going to have an easier time making more from the sale of your pet sitting business because clients REALLY don’t associate you with the business-they associate whoever picks up the phone on a given day. Also, the new owners won’t have to work so hard if there’s a steady management team in place (though there’s no guarantee that the new managers will stay).
You have good reviews online. Good review means positive goodwill. You want that! And the new owners will too. And they will pay more money to get an established business that has a glowing reputation.
Your gross (and especially net) have increased the last three years. The net relates to profit after expenses and if your net is increasing your profit is increasing. If you’ve increased your business by 10-20+% each year in the last three years, then a buyer will be willing to pay A LOT more for your business because they will anticipate the business being able to continue to grow and grow and grow under their care.
You’ve been in business for seven years or longer. A lot of businesses close up shop in the first three or five years. If you have survived -and better yet- thrived- in the many years you’ve been businesses, then you will be able to garner more money for your business.
Some pet sitters are done after a few years. Others can’t imagine doing anything else. No matter where you are on the spectrum, it’s important to remember that your business is an investment. It could be your retirement savings the way selling a big house might be. Be conscious well in advance of where you are on the ‘do-I-want-to-sell-my-pet-sitting-business spectrum because at least three years prior to sale you will want to begin to make sure all your ducks are in a row in order to garner the highest price!
I provide coaching and supportive guidance for those of you who are considering selling your business.
For more information about how I can help you set up your business to be the large investment for your future that it could be, contact me.