I have a small but successful computer consulting business with a service industry client base (no residential clients). A large competitor wants to hire me (and of course bring my clients with me to the comapny). I am not selling my name, inventory, or anything else. These clients represent about $60,000/year in net revenue. If completed, this would help the buyer expand its cutomer base in a neighboring city they are trying to get established in. The buyer has all the necessary infrastructure and personnel in place to support these clients without a significant drain on its resources (remember, this is a much larger company).
I have done some cursory research, and spoken to a few people, and I have come up with anywhere from 1-3 times the annual income. Is there a formula to determine the value? Would a CPA or a financial advisor know? Or should contact an attorney to help in negotiation?
Thread: How much do I sell for?
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How much do I sell for? – 06-22-2006,09:39 AM
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- Jun 2006
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Depending on the net worth of your current business, you should compare the offer of your competitor if it is worth the sell of. A CPA may assess the value of your business and its net worth, you should definitely hire a Good and Honest CPA to assess the value of your business. You should also let your lawyer know whether or not the contract you have with the one who's trying to hire you, clean and without any kind of loopholes that will backfire on you.
Are they only buying your clients? I'm asking this because if they buy your clients, you are left with your stock and no clients. So think about that.
It does sound like you might be dealing from a position of necessity here (but I might be wrong!) as your revenue isn't that large and you appear to feel the need to go and work for someone else that maybe offers greater opportunity and stability.