Doggie daycare’s a special place for pet owners. They entrust workers to take great care of their fur babies, and the reason you probably considered opening a doggie daycare was because of your passion for great care of pets while their owner is away. You have a passions for these animals, and your regulars have become an extended family, but at the end of the days, you have started to wonder to yourself, How much is my doggie daycare worth? A broker can help you find the answer to that question, but understanding the process is always beneficial to you as an owner. After all, your objective is to receive the maximum value for it, and in order to do that, you must first look at the many variables that come into consideration when looking at the possibility of selling your doggie daycare.
In order to show you the different variables, we have taken data from the last decade of all the doggie daycares sold in the United States that met our criteria, and broken it down for your further review in order for you to make a solid decision on the sale of your business.
What is your doggie daycare worth?
The value of your doggie daycare is correlative to your individual business, the market and what potential buyers are willing to pay. Doggie daycares can offer services that range from daily care, extended care, or even grooming and generally speaking the more services that your business has to offer the higher sales price you are able to ask. So while you are trying to figure out how much your business is worth, here are some questions that should be answered before trying to value the price of your business.
- What are the sales?
- What is the profit?
- What are the growth trends?
- What is driving new sales and is that sustainable?
- What channels do new customers come from and what is the breakdown of each channel?
- What is your market position?
- Is your Location favorable?
- How reliant is the business on the owner?
- What systems and processes are in place to run the business?
What makes a doggie daycare worth more?
When a buyer looks at purchasing your business, they are basically looking at their rate of return on their investment. So when will they recover what they have spent on the business? In order to show the prospective buyer that their ROI will be high and their relative risk will be low, you should have the a few key characteristics associated with your doggie daycare.
And while it is true that the profit and sales are considered very important aspects when considering to purchase a business, they are not the only factors that can add or decrease value the value of your business. The following characteristics will give your business better value.
- Predictable key drivers of new sales
- Stable or growing traffic from diversified sources
- Established suppliers of inventory with backup suppliers in place
- Traffic stats
- High percentage of repeat visitors and repeat sales
- Clean legal history
- Brand with trademark, copyright or legal concerns
- Documented systems and processes
- Growth potential
What does the average doggie daycare sell for?
Looking at the graph, the broken down the data that we analyzed from the last decade, which consisted of businesses that range in the $50 thousand to the $10 million valuation range. And these businesses can sell for as much as billions of dollars or as little as a few thousand. You can clearly see the average of doggie daycare sold in the last year in the United States is at .63 times earnings, with the average sale price coming in at $420,927.21. However, to have a clear understanding you also have to look at the median sale at $220,000 and the most frequent sale at $125,000. All this information is a bit overwhelming without being broken down, so later in this article, we will break down these numbers and give you the information needed to be able to start the selling process.
What is the most frequent deal size?
The most frequently sized deal, to look at when selling your doggie daycare, is the valuation range of $0-250k. This range has continuously had the most the number of sales, for the last 10 years.. For example in 2015 there were a total of 26 doggie daycares sold, and of those 10 were valued at the 0-$250 range. There is no need to worry if your business does not fall into this category though, there is someone to buy your business and finding the right broker will help.
Is the doggie daycare market getting bigger?
Looking at the trend of the past 10 years, you could say that the market is getting bigger, in 2015 the total yearly transaction was well over $14.5 million and in 2014 it was over $13.9 million. There will always be the fluctuations in the market and trends but being able to keep your business stable during those times will give future buyers the assurance that your doggie daycare is a good investment and buy.
Are bigger businesses worth more?
Generally speaking, yes, the bigger your business is, the more that is is worth. Take a look at the image below, as there is an increase in revenue, your multiple becomes higher, which helps generate a better return on your personal investment.
To help you understand the graph a little better, look at the multiple from 2015 for the valuation price range of 0-$250k, here the average multiple lands right at1.62, with a total of 26 doggie daycare sold, however when your business’ valuation is in the $2-10 million range the multiple jumps to 4.48, with 1 doggie daycare being sold. So in the case of this data, the bigger doggie daycare have surpassed the 0-$250 k range, and have way less number of businesses for sale.
What states have the most doggie daycare business deals?
Are you wondering where the most deals were made throughout the country, or if your state has a hot market to sell fast? California and Texas had the largest amount of doggie daycares sold, which makes complete sense because they are two of the largest states in the country. Don’t become discouraged if you are not in one of those states though, just because you are in a state with a lesser number of sales that doesn’t mean that someone is not looking to start a business venture in your area. Having a broker to help you find a buyer for your doggie daycare no matter what state you are in, can help you successfully sell your business.
Why would you sell in the first place?
When deciding to sell your business, it can become an overwhelming and difficult decision. Your reasons will always be different from the business owner next door. Maybe you are wanting someone to cater to your needs instead of catering to theirs, or you are ready to retire. Whatever your reason is, be sure that you have the necessary knowledge and tools to get the value out of your business that you are looking for.
How long will it take to sell your doggie daycare?
There is not one set timeline for the sale of any business. The variables of the individual business and terms of the sale will define how long it will take to sell. Do keep in mind that generally speaking, the larger the deal (over $1 million) take longer to sell, over the smaller deal (under $200k) because of the complexity of the business, in addition to the risk of purchasing a company that large for the buyer. And try to remember, that your individual business will always sell at a different pace than other doggie daycare, and being patient is an essential part in selling.
What is the process of selling your doggie daycare?
Our step by step process will help you become more confident, when you decide to sell your doggie daycare. Many business owners forget or overlook essential steps in the selling process and sometimes become confused and lost throughout the process. Doing each and everyone one of these steps will help guide you to the maximum profit of the sale of your business. If you have questions or concerns about your business’ value or the process in itself please contact us and we will be happy to help.
Who will buy your business?
Finding a buyer can be frustrating and feel like a never ending search, but finding one is essential for the sale of your business. Tuck that frustration and fear aside because there are many options and possibilities. Buyers can range from first time buyers, experienced entrepreneurs, or private equity companies. No matter what the size or maturity of your business there is a buyer for your business, and we can help you find them.
After reading this article and understanding the necessary steps and processes that come along with the sale of your doggie daycare, and you’ve decided that selling your business is the right decision, we encourage you to have your doggie daycare valuated by a professional broker, this will ensure that you are receiving maximum value for your business. We understand that your doggie daycare is your everything, and we always keep that in mind, when valuing your business. So when trying to answer that question of what is your business worth, comparing it to the business in the next town over, will not get you the exact answers you seek. When you are ready to take the first step, we will be more than happy to help you find the true value of your doggie daycare, and can help accelerate the sale, by helping you find the right buyer as well. Feel free to fill out our valuation form and get started right away.