Q. What should I check out if I want to purchase an existing cleaning service?
A. In addition to analyzing and verifying all the financial data, I would appraise the non-tangible value of the good-will. Accounts come and go. If you are serious about the business, visit the largest and most profitable accounts at night (sign a non-compete, non-disclosure contract if necessary). Determine if any customers are high maintenance and how smoothly the operation runs.
The next step would be to ask the seller if you could go with him on a customer visit. If things are progressing, mention to the customer you are considering working in and managing the business including his account. Once you have the customer’s confidence, tell him you are purchasing the business. Communicate with integrity, yet remember: a business divorce and re-marriage often functions best when performed in stages.
Prior to the purchase; evaluate customer fit. Does rapport occur naturally? Does the current service level match customer expectations? Have past QC inspection reports been satisfactory? What complaints have been received in the past? Have customer service issues been handled in a timely manner? Why are margins low? Is the company known for low-ball pricing? Does the company maintain high levels of customer loyalty?
Find out what makes the business tick. Ask for a 90-day guarantee from the seller that each account will switch over or the purchase price will be reduced. That puts pressure on the seller to work for a smooth transition. Consider hiring a mentor who will work with you personally.
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