5 Things to Consider Before Buying a Cleaning Business
Buying an existing cleaning company that has been setup, established, and often times generating revenue already can be highly beneficial in a variety of ways.
From generating revenue instantly, to avoiding all of the startup pains, and so on. The benefits of buying a cleaning business over starting one from scratch are there, but there are things you must consider before buying any type of cleaning company.
Here we list the 5 things you need to consider while deciding whether or not to go ahead and buy a cleaning company or not.
1. Discover what you want
Do you want to buy an existing cleaning company that is small, medium, or large in size?
What I mean by this is…
Would you rather start off buying a small cleaning business that still has a lot of potential room to grow but is still going to take a good amount of leg work to get there? Or, a large company that’s very well established and has a lot less room to grow? Of course, anything in between is available too, but which do you want is what you really need to figure out.
Remember this: The bigger company you get sales wise, the more expensive it is going to cost you.
Discover what works best with your financial abilities, your work motivation (to grow the business further), and where you want to be in 5 years.
2. Know who you are dealing with
I highly suggest before you even consider moving forward with the research of an existing cleaning services business that is for sale is to ensure the person you are dealing with is genuine.
Imagine this scenario…
You go all the way through researching, inquiring, and even some legal steps to acquiring an existing cleaning business. Come to find out that before you close, or even worse after you close, the person who sold to you isn’t known for being so honest and trustworthy.
This puts me off for a lot of reasons, but the main one being that they can’t be trusted with these types of things. No matter how legitimate, seemingly perfect, or just upright a great fit it may seem; I wouldn’t trust things as they come to you.
So over everything else, make sure you know who you are dealing with before moving forward with ANYTHING. But, if they are legitimate person, whether you know them, through a friend, or simply asked around about them, you are typically a lot safer!
3. Make sure you really want this
Along with the previous point, before you invest anymore time and energy (maybe even a little bit of money) into researching a specific cleaning company for sale, make sure you know 100% that it’s what you want.
You seriously don’t want buyers regret a week after you buy the business and realize that you don’t truly want to operate in this industry.
To find out, you can try getting a job in a similar position to see what your daily tasks will be like at your newly bought company. If you love it, then go ahead and keep looking for a cleaning business to buy! If not… you may want to back off and find what you truly would enjoy doing.
Because the last thing you want to do is take out a loan, buy a business, and realize you hate it.
4. Find out the REAL reason they are selling the business
As an outsider looking inward on a company, we often overlook the vital key points of a business because of two reasons:
- We aren’t involved on a daily basis to see deeply into the business
- The facts and stats aren’t readily available to us as an outsider
This can cause multiple issues, most importantly the issue that the business might be for sale because of far from perfect business trends. You need to figure out how the business really is doing, try to look for every bad reason someone might be selling it, and from there analyze if it’s being sold because of bad reasons or simply because they want to move onto a new part in their life.
Discovering the real and true reason a business is being sold can be a surefire way to avoid buying a business that is going downhill. You better be finding out why, and if the why is bad; run away (or, offer something in hopes of building the business back up)!
5. Can you afford it?
This is one of the toughest parts for any business owner. Buying a business with cash can be tough, especially if you don’t have a large sum of money laying around in your bank account.
Often times we look towards loans, sellers financing, and even people we know to finance our business purchase. Of course these all have their positives and negatives; so finding the best one that works for you is key.
Seller financing is a very good option to go with; as often times a seller is much friendlier than a bank, especially if you build a rapport with the previous owner/s.
Worst case scenario is this: you have to take out a loan. But if you followed all of the other things in this list and you are sure that this business can pay it off, then the risk is very well calculated and I wouldn’t be too afraid of jumping into it.
Have no credit? You might need to start your own cleaning service from scratch; the costs are minimal just the effort is more.
There you go! 5 things you need to watch out for, consider, and evaluate before you go any further with purchasing a cleaning company you’ve had your eyes on.
If you have any tips, comments, or even questions related on how to buy a cleaning business; share them down below. I’ll surely join in and comment back on anything, so share what’s on your mind!