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Tips For Your First Home Service Acquisition! ✏️
Know before you go to buy
When You’re Acquiring to Acquire
Sup,
Acquisition is the first step on the home service journey for many of our readers. That’s also easier said than done. If you’re beginning that process, I have actionable tips and self-reflection questions to consider along the way.
Was this forwarded to you?
But maybe you’re already past that acquisition. Are you a business owner still growing and scaling? Have burning questions that need answers?
You’ll get your first chance this Wednesday, May 29 with my first Q&A live stream—exclusive to our business owner Facebook group.
It all goes down at 2 p.m. EST, live.
If you want to take part, join the group and RSVP. Already planning on coming?
Let’s break down acquisition plans.
Let’s do it.
Buy or Build?
Know what you want.
The Search Begins
Vendors, social media, and more
Finances In Order
What are you buying? Be sure.
The Story So Far
Know what that business is already doing.
Reading time: 4 minutes and 30 seconds
Build versus Buy
The first question you’ll need to answer.
Ten times out of ten I’m going to buy over build. Why?
Do it overnight: Why wait a year or more to get off the ground? Spend, and get going right away.
Systems in place: Acquiring means that systems are already in place that won’t need to be built from the ground up. Hopefully. Ad spend, lead gen, personnel. Etc.
Installed reputation: Ideally, one of the best reasons to buy is that customers, vendors already know that company/brand.
But be ready to ask yourself: Are you willing to take on the challenges that come with a ‘known’ quantity? More on that below.
But let’s say you have the rest figured out. Where does the search start?
It’s time to get digging.
The Great Acquisition Race
Part of getting the process going is finding a business that’s looking to sell.
Now, you could be particular about the search and create a profile of your dream business.
But dreams often aren’t real. Doing so runs the risk of creating expectations that no company can meet. Instead:
Talk local: Vendors, peers, and more are all good sources to start the search. Who is looking to unload? What’s out there? Where is there a gap?
Questions to Consider: Are they commercial or residential? Service or new construction? Where is your location? How do you want to approach the search? Are you using a company’s Google reviews as a metric for them being purchasable?
Questioning the Business
Perhaps the biggest part of how to acquire your first home service business is knowing what and who you’re getting into bed with.
Keep in mind the following:
Financial health: What is the revenue consistency, profitability, and liabilities?
Due diligence: Common practice is buying companies at 3x their earnings, then selling at 5x earnings.
What’s the noose: Will you be on the hook for any hanging swords? Find out.
The First 90 Days
Do some vision training. If you buy, what does the first three months look like?
Things to consider include:
Technology in place
Marketing/lead gen being used
Conversion: Will you have to go from commercial to service?
Scaling: Are you building to sell or building to expand? Figure it out.
All of these questions need answers before you ever buy. Good luck.
On the Pod This Week
This week the podcast looks at failure and the danger of busy seasons. We also based yesterday’s episode on a question from our Facebook group.
Don’t want to miss a minute? Then consider subbing over on YouTube.
Want our first free referral reward, ‘Optimizing Warehouse Management In Your Home Service Business’? Then share OaO and get rewarded.
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Go get it.
👊
John
For the next 25 days I'm going to be collecting my thoughts and feelings on the acquisitions and business scaling game. I've been around the block and if you're looking for a place to start then bookmark, follow along, and get the best of my best.
— John Wilson (@WilsonCompanies)
2:29 PM • May 14, 2024
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