Opportunities
Recurring Landscape with Exterior Decor
Sold
Specifications
Established for 16 years, customers include an exclusive clientele with a range of services provided multiple times per year. This year-round landscape design and maintenance business does everything from seasonal change-outs to elegant designs. The company has a strong base of 450 clients, with 25% requiring weekly or bi-weekly maintenance, and averages 10 new clients each year.
Services include consulting, landscaping, maintenance, seasonal change outs, interior plant scaping, and floral designs. Many customers are currently receiving weekly maintenance, with many more requesting this service. This is an untapped area for great growth that a buyer should seriously consider. Part-time workers can be added to the team to cover the increase in business.
On staff are long-term employees to provide customer service, landscaping, maintenance, and direction to seasonal employees during peak season. All have a minimum of 15 years with the company and are knowledgeable, allowing them to easily handle most of the seasonal planting services for clients. Additionally, as they are known by the clients, staff can provide services with a limited amount of supervision.
The company’s vehicles and inventory are included in the purchase, allowing a growing landscape company to acquire more assets and an outstanding client list. This is a one-time opportunity for an ambitious landscaper or an established landscaping business looking to gain a new client base.Business Highlights
- Years in Business: 16
- Location and Service Area: Omaha Metro
- Number of Clients: 450 – 10% require weekly maintenance, 15% require bi-weekly maintenance. 90% of clients have changed-out planters requiring quarterly maintenance
- Services: Consulting, landscaping, maintenance, interior plant scaping, seasonal change-outs, and florals. No mowing.
- Building: Operating greenhouses may be leased
- Reason for Selling: Desire to spend time on other interests
- Employees: 3 FT – customer service, landscaping, maintenance, and supervision of spring and summer seasonal employees.
- Hours: Year-round service
- Seller Training Period: 3 – 6 months
- Growth Opportunities: Weekly maintenance. Lawn services. More commercial clients. Snow removal.
- Current Owner’s Responsibilities: Landscape design, project management, inventory, and billing.
Financial Highlights
- List Price: $325,000
- Gross Sales:
- 2017: $584,767
- 2016: $564,317
- 2015: $138,674
- Cash Flow:
- 2017: $162,298
- 2016: $138,674
- YOY Growth/Sales Trends: 20% growth in sales between 2015 and 2016
- Profit Margin: 28%
- Assets Included in the Purchase:
- Vehicles: $121,000 - Dump truck, flatbed, 2 box trucks, skid loader
- Intangible Assets: Vendor lists, client relationships & reputation.
- Inventory: $24,750 – concrete planters, Mexican pottery, soil, fertilizer, annuals, seasonal decor and nursery stock.
*amounts may vary
Cash Flow Analysis
| Description of Financial Statement | Tax Return Jan - Dec | Tax Return | Tax Return | Notes |
| 2017 | 2016 | 2015 | ||
| GROSS SALES | $584,767 | $564,317 | $470,625 | |
| Net Income Shown on Financial Statement | $88,253 | $27,672 | $-42,105 | |
| ADDBACKS | ||||
| Compensation to Owner | $41,884 | $41,303 | $41,484 | |
| 11% Tax on total W2 Salaries | $4,607 | $4,543 | $4,563 | |
| Depreciation | $16,292 | $15,503 | $18,153 | Non-cash item |
| Non-Business Telephone | $1,600 | $1,600 | $1,600 | $133/month |
| Travel | $4,515 | $4,070 | $2,473 | Personal expenses |
| Personal Products | $0 | $10,578 | $11,874 | Personal expenses |
| Personal Auto Fuel | $2,080 | $2,080 | $2,080 | $40/week |
| Personal Auto Insurance | $1,200 | $1,200 | $1,200 | $100/month |
| Payroll-Daughter | $0 | $26,035 | $0 | Non-onward going expense |
| Life Insurance | $0 | $1,215 | $943 | Owner's life insurance premiums |
| Long Term Care | $1,867 | $2,875 | $2,875 | Owner's health insurance premiums |
| TOTAL ADDBACKS | $74,045 | $111,002 | $87,245 | |
| Seller's Cash Flow = Total Addbacks + Net Income | $162,298 | $138,674 | $45,140 | |
| Profit Margin | 27.75 % | 24.57 % | 9.59 % |
- 28% Profit Margin in 2017
- Sales in 2017 have grown by 3.6%
Services
- Residential and commercial landscape design
- Installation and maintenance
- Annual, perennial and tropical plants
- Spring and fall clean-up
- Concrete planters
- Pottery
- Seasonal planters
- Most clients require 5 seasonal change-outs
- Exterior & interior Christmas lights/decorating
- Mantles, staircases, Christmas trees
- Lights/decorations are taken down in January & February and stored by the company for a charge (or can be stored in client’s home)
- Consulting
- Exterior layout of walkways and patios
Clients
- 450 clients / 145 are active on a weekly or monthly basis
- Most are provided with services an average of 4 – 5 times per year, beginning in early spring through Christmas and winter
- 10% receive weekly maintenance
- 15% receive bi-weekly maintenance
- 50% receive monthly maintenance
- 90% of clients have changed-out planters
- An average of 10 new clients per year
- Most clients have been with the company for more than 10 years
- Demographic is exclusive clientele in Omaha, Fremont, Council Bluffs, Elkhorn and Valley
- Multiple jobs per day are completed
Employees
- Full-time, long-term
- Landscaping installation and maintenance
- W2 employees working year-round
- Oversee 2 seasonal workers
- Minimum of 15 years with the company
The seller is a Landscape Designer scheduling and meeting with clients. Plans, pricing and budgets are discussed. Most clients have been serviced by the company since its establishment.
Growth Opportunities
- Weekly maintenance
- Many customers are currently receiving weekly maintenance with many more customers requesting this service
- This is a great chance to increase revenue through the addition of seasonal part-time employees
- More commercial clients
- Many leads coming to company for work to be done
- Lawn maintenance, snow removal and hardscapes
- These services not currently offered, and could be added to boost income
Valuation Details
The Firm Business Brokerage used a Cash Flow Valuation to determine the Purchase Price of a business.
The formula used is as follows:
2017 Cash Flow x Prescribed Multiple = Fair Market Value
Cash Flow is the sum of business net income plus any owner perks and any non-onward going expenses.
A multiple is prescribed by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiple.
With this information, the computation is as follows:
$162,298 x 2.01 = $326,219
The Fair Market Value found above positions the business List Price at $325,000.
Funding Example
Purchase Price: $325,000
10% Buyer Down Payment: $32,500
10% Seller Financing: $32,500
80% Bank Loan: $260,000
Seller Financing 5-year term at a rate of 4.5% equals a monthly loan payment of $606.
Bank Loan 7-year term at a rate of 6% equals a monthly loan payment of $3,798.
After business expenses and loan payments, a buyer with a 10% down payment of $32,500 would retain a profit of $109,449, a 337% return on investment in the first year!
A lender is required to have a minimum 1.5 coverage ratio for any business loans extended. At a proposed Purchase Price of $325,000 with the terms listed above, the coverage ratio is 3.07.
Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available.
Print, sign and send to:
210 N 78th St. 2nd FloorOmaha, NE 68114
Or fax to:
f 402.939.0857