April 29, 2016
By Jason York, E-Z Window Cleaning
Every month as a board member of the IWCA, I am asked to write an article for the members. Sometimes I struggle to bring something relevant to my fellow window cleaners. Other times, timely events make this task easier…
In the last year we have been approached by three different window cleaners looking to sell their businesses; one having been within the last month. It is very flattering to have a peer/competitor make such an offer. We are always looking to expand our brand, and acquisition is a great way to do it. All of these businesses represented great value but, in all three cases, things didn’t make sense for us to complete the deal mostly because we could not come to a win/win type of arrangement. For our company, that part is mandatory.
In all three cases, the other owner was looking to sell “now.” That is a real challenge for a buyer, and negatively effects the value of a company. How does the buyer convince the customers that they will service them as well, if not better, without the seller there to provide assurances? Why would they choose to be loyal to a new company that they are not familiar with? What’s the real value to a good customer list, if in a year, half or more of those customers have moved on to other companies…? Helping with the transition is critical to providing value to a potential buyer.
In addition, all of these companies were looking at selling in the spring with no employees to go along with the customer list & assets. In spring we are already spread thin with our existing/new customers and are at our lowest staffing point of the year. Does it make sense to take on a whole new “book” of business then? To us no. Buying a new business with the employees to support the business, going into the busiest time of year seems like a recipe for disaster. Think 80 pounds in a 50 pound bag…! Employee acquisition proves to be our toughest challenge every year, especially in the spring. Why would anyone want to make that worse?!?
The point I’m trying to relate is always keep an exit strategy in mind. I love my business and the window cleaning industry and I don’t ever plan to get out but, through these experiences, both my partner and I have developed plans for a potential exits that make
sense. A good customer list is extremely valuable but is worthless to a savvy buyer without some planning and effort. Always keep in mind what makes your business valuable and maintain that value through the sale. Know that it’s not the name, website, trucks, or squeegees; it’s the service and customers. How you decide to transition them is where you will get the value in the end.
