Selling Junk Removal Business after 4 years

[alf]

Hi All,

I’ve enjoyed running my junk removal business after 4 years and over the last 3 years we average $170k-200k in revenue, $60k-80k in profit. The majority of our clients are commercial. I’m looking to get out so I can travel the next 1-2yrs while having a part time job.

I’ve spoken with business brokers last year on selling but the problem I run is that my equipment is worth about 10k and my commercial contracts are nothing more than a handshake and being on a vendors list, no written contracts with any of my commercial clients. The business broker said I’m essentially selling a full time job to someone which makes it nearly impossible for a person to obtain and loan to purchase the company.

This year we will do $200-220k in revenue and probably be at 100k profit. I’m not sure how I should approach selling the company or just letting it die. I feel that all the connections I’ve made would be a waste if I didn’t try to get some value out of the company upon exiting. We haven’t needed to advertise our company in two years, so we’ve spent $0 in advertising costs.

Has anyone been through a similar situation?

I'm not sure if 50k is too high or too low for this company.

 

[silvamay]

@alf Would you be able to give 60-70k of the profits to a general manager that you hire to run it for you while you pocket the rest and travel? Your “part time job” could be doing all of the managerial tasks that is out of the range of the general manager you hire. You could still grow the business and not let it go, or at least keep it the same size, so that when you are ready to come back full time in a couple years you can expand further and hire more help etc.

 

[alf]

@silvamay Thank you for your response. I've tried hiring employees to eventually step into a general manager role but I've haven't found someone to run it after 4 years. The difficult aspect of the job is that you can work 20 hours a week or 50 hours a week. 2 hours one day or 12 hours the other, everyone I find has a hard time with the inconsistency of their workday.

 

[sharone]

@alf Are you trying to pay them hourly? If yes then that’s not a surprise. For a manager in the sense that you could step away from the business I would expect consistent salary.

If you really want to incentivize them then a profit share/bonus structure is even better, especially if you can be totally hands off

 

[gabjensnsn123]

@sharone Id say a salary and sales commission is the best bet.

If they have a 2 hour work day then that’s 6 hours of cold calling, advertising, networking, etc

$65k plus 10% of anything they sell

 

[silvamay]

@gabjensnsn123 This right here. Get the right candidate, train them for a month or three, give them a salary that comes every other week no matter what so they have a reliable paycheck, and if they find you more work give them a percentage of it.

This gives them financial security and the incentive to go out there and get you more business. Hell, with the right person you could double or triple your business in the couple years you are traveling and hardly lift a finger aside from signing paychecks and paying taxes.

I would venture to guess a good salesman could scrounge up a couple more customers monthly, especially if it means that they will get 10% of it.

OP does advertise for whatever reason, now is the time to start. Get your sales high enough that you can pay your new GM good money and pay yourself 80-100k as well. Win win

 

[brozza]

@gabjensnsn123 This is the answer

 

[ericph]

@brozza So say we all.

 

[princesstatyanna]

@gabjensnsn123 I've had a few of these jobs and I'd consider something like this

 

[abrahamictheist]

@sharone I work construction. In my experience, inconsistent paycheck is a relatively small problem compared to inconsistent hours. I wise person can bank the overtime and make the times with less hours by leaning on savings. The problem is basically the fact that you can’t plan anything because you never know what days you’ll work or how many hours you’ll work. You can’t be responsible for picking up your kids, schedule doctor’s appointments, make plans with friends, etc. It really fucks your whole life up.

 

[alf]

@sharone

is

I pay them 40-50% of the cost of the job.

 

[purposeful]

@alf No jobs, no pay.

 

[gabrielbb]

@purposeful No woman no cry.

 

[pastornick08]

@gabrielbb I’ve just understood the words to that song for the first time. Embarrassing for me, but thank you.

 

[gabrielbb]

@pastornick08 The funny thing is that it happened for me after I wrote the comment. I wrote it because the previous comment put the lyric in my head, but then I thought, "Oh, damn."

Just checked the whole song's lyrics and I'm lost again.

 

[infintiletheologian94]

@alf Where are you located?

 

[alf]

@infintiletheologian94 Colorado

 

[jimakoskx]

@alf Denver or another area? Interested.

 

[kickthichphattiren689]

@jimakoskx Following up on the city as well

 

[dxsn0]

@alf You have a roll off truck? Roll offs? Or is this just a dump trailer and tools etc