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Common FAQs when buying a pool route
A pool company typically offers a wide range of services to ensure your pool is clean, safe, and well-maintained. Here are some common services they provide:
- Regular Pool Cleaning: This includes removing debris, brushing the walls and floor, and vacuuming dirt and algae.
- Chemical Balancing: They routinely check and balance the pool’s chemicals, such as pH levels, chlorine, and alkalinity, to keep the water safe and healthy.
- Equipment Maintenance: This involves inspecting and maintaining pool equipment like filters, pumps, and heaters to ensure everything is functioning properly.
- Pool Inspections: Regular inspections to identify any potential issues, such as leaks or equipment malfunctions.
- Opening and Closing Services: Preparing the pool for the swimming season and properly closing it down for the off-season.
- Repairs and Upgrades: Fixing any issues with the pool structure or equipment and offering upgrades like new pool covers or safety features.
These services help keep your pool in top condition, allowing you to enjoy it without the hassle of maintenance.
(It rarely snows in Florida & Texas)
Just like a car in general, you’re selling it not because it’s a bad car, but because you want a new car, or it no longer fits what you need. It’s like saying you sold your old sedan because your family grew from 2 people to 5, so you buy an SUV or a van. The same thing can be said towards houses
The decision to hire employees for your pool cleaning service hinges on your business goals, workload, and the level of service you want to provide. Starting as a one-person operation is common, but as your business grows, so might the need for a team.
An SBA loan, which is designed to support small businesses, typically cannot be used to purchase a pool route because SBA loans are generally intended for business-related expenses such as working capital, equipment, or real estate. Purchasing a pool route is considered an acquisition of a business or a business asset, and while SBA loans can sometimes be used for business acquisitions, the specific nature of a pool route might not align with the SBA's criteria for eligible business types or the collateral requirements. Additionally, the SBA has specific guidelines and restrictions on the types of businesses and transactions it can finance, which might exclude pool routes depending on their classification and the lender's policies.
Example: You are selling tires (assets) and you would like to sell it to a company. Just like the pool accounts, they are transferred from one company to the next. The new company starts a new business with their own business name.
(Most of the customers just want their pool clean. They don’t care who cleans it)
Even if these sellers have a contract with their customers but they provide a bad service, their customers aren’t going to stay because of the contract.
When purchasing a pool route, you typically do not receive a profit and loss statement because you are not buying the entire business entity. Instead, you are acquiring a list of accounts or an income stream from the existing business. The main focus is on the payment history of these accounts rather than traditional financial statements.
The payment history provides insight into the reliability and consistency of the income you can expect. It reveals whether customers are paying on time or if there are issues with late payments or non-payments. This information is crucial for assessing the value of the pool route since it directly affects your potential earnings.
In essence, the sale of a pool route is more about transferring a set of service agreements rather than the complete operational structure of a business, which is why the financial documentation provided differs from that of a full business purchase.
To fund your pool route purchase, you typically have three primary options due to the nature of these businesses:
Available Cash: Use your personal savings or liquid assets.
Retirement Funds: Withdraw from your retirement account, keeping in mind potential penalties or taxes for early withdrawal.
Lending Agencies: Below are some examples:
OrangeFi: A company known for assisting buyers in funding their pool routes. They have a history of successful collaborations. Learn more about them here.
Navy Federal Credit Union: They offer personal cash loans with minimal interest rates which could be suitable for your purchase. More information is available on their website here, and you can watch an informative video about their services here.
Remember that traditional bank loans are usually not an option for pool route purchases unless you use other collateral such as a cash-out refinance on your property or a home equity line of credit.
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