As a former real estate agent and current kennel operator, I have gained a unique perspective on kennel valuation. I’d like to share some of these ideas to help buyers buy a kennel business.

First of all, if you have a chance to buy a kennel and the numbers make sense, GO! Unfortunately, the last part of that statement about the numbers making sense can be the hard part, as many marketers have overpriced their kennels. At the end of the day, a kennel is worth the income it generates. An expensive lot is great and a beautiful building is fantastic, but if the kennel does not have the potential to generate good income, it is a bad business move.

I have seen beautiful kennel facilities open in poor locations that lack the demographics to maintain a kennel. And the seller wants to recoup his cost by putting together an A + facility. Present your offer based on projected income. You can give a small allowance for a good installation. But it all comes down to income, income, income!

I have also seen people with kennels on expensive land where surrounding properties sell for a premium. Often, they will determine the value of your business on the value of the land + the value of the business. This is completely irrational. For example, if the highest and best use of that land is for residential development, then the kennel must be demolished and the houses must be built on that land. However, if the highest and best use of the land is for the operation of a kennel, then the land will NOT be used as residential development and the price must NOT reflect the value of the residential land in the area. Also, if land is expensive in the area, the cost of living should be higher and the income from the kennel should reflect those higher boarding fees. Therefore, once again, the calculation of value based on income should be the primary issue in determining value.