For Sale Website:
We researched and analyzed a lawn maintenance company that is for sale. The purpose of this analysis is to see how much the company is really worth. Using this information, a potential buyer can accurately assess the investment to decide if it is worth their time. The potential buyer can personalize the evaluation by changing the assumptions listed at the top of the spreadsheet, or by adjusting the numbers individually. This allows them the freedom to personalize the statement based on what they think is realistic for them. The main inputs are written in blue font to make them easy to find and adjust.
This analysis creates pro forma income statements and balance sheets going from 2013 to 2022. Additionally, it provides the NPV, IRR, and WACC for the lawn maintenance company. We based our information off industry standards, online prices for gently used equipment, and a local landscaping company. In our initial forecasting, we made the following assumptions:
- The founder started the company by buying mostly used equipment.
- The business loan is paid off in 4 years.
- Total revenue increases by 5% each year for the life of the business.
- Minimum cash balance is set to equal a month’s worth of payroll expenses.
- All equipment depreciates by the straight line method over a useful life of 10 years with no salvage value.
In conclusion, this company has good returns in relation to the initial investment. The net present value of the company is just over $287,000 with an IRR of 79%.