Should we Buy this Business need advice please

[Vanessa31]

Hey guys I need advice on a business that is for sale, I am not sure how much to offer
here are the details

SELLER WANTS $49,000 AND THE MOST HE WILL GO DOWN IS $2000.00

SELLER HAS 66 ACOUNTS THAT ARE IN THE SAME AREA GROSS $5,230.00

ADDITIONAL WORK-FERTILIZING.MULCHING ETCC IS ABOUT $1500.00




HE SAYS HE HAS THE FOR ABOUT 10 YEARS OR SO. TEH WORKDAY IS FROM 7.AM-1PM 5 DAYS A WEEK-NO WEEKEND OR HOLIDAYS

EQUIPMENT-HE SAYS ALL IS COMMERCIAL GRADEE

6X12 ENCLOSED TRAILER W/REAR RAMP DOOR AND SIDE DOOR

2005 GRAVELY 44 INCH ZERO TURN MOWER W/ 19 HP ONLY 2 MONTHS OLD


2/2005 STIHL LINE TRIMMER

2/2005 STIHL STRAIGH SHAFT EDGER

2001 GREYHOUND 39 INCH WALK BEHIND HYDRAULIC MOWER

2/2002 ECHO LINE TRIMMER

2/2002 ECHO BACKPACK BLOWER


let me know what you all think, I am new to this kidn of biz so i want to make sure i am making a good choice, I offered him 42k and he said NO. he seems not to want to lower mcuh form the 49k





he says he does 72k gross a year

[Toy2]

Sounds pricey, but then again I'm new to this, I would make sure its in writing that he can't sell to you and then start it up again.....are all of these customers on contracts?

[Vanessa31]

yes it is pretty pricey but he swears he is giving it away, the customers are not under contract but he has had them all for a long time. the reason for selling the biz is because he says he is moving away. humm

[dvmcmrhp52]

Hate to rain on your parade but, To me it's not worth much more than 15,000-20,000.

With the equipment he's got I'm not sure I believe he's been in business for ten years.

Buying accounts or businesses in this industry is something to be careful about...........

[SOMM]

There's only ONE WAY to know if it's really worth the negotiated price:

Ask for copies of his past 2 or 3-years worth of federal returns on the business - not personal taxes
(with any personal social security numbers obscured before your copies are made). Go over it with your accountant if necessary, and get your questions answered.

If he won't show you these he's all smoke and no fire, and not worth dealing with in good faith. If it's worth dealing with, then it's also worth him signing a non-compete agreement for at least 2 years.

[qwikv6]

Why not spend a thousand or two on a good advertising campaign? Newspaper inserts, mailbox flyers, newspaper display ads, etc.

$49k is TOO much. If he's been "in biz" 10 years, why aren't any of his clients under at least a signed agreement?

[Tider6972]

Vanessa31, stay away from those business brokers !!!!!!!!!!!!

As you have been informed, they grossly over-value lawn businesses.

The principles to purchasing are the same as the last time you looked to buy.

It is possible you could pay this guy $49,000 and have every single account refuse to do business with you, and you'd wind up with about $6000 worth of equipment for your $49000 !!

If indeed the customers have been using the seller's services for this long, they are loyal to <i> him </i>, yes, but not <b>you</b> !

Stay away from this !

[SOMM]

awesome points A.M & qwik!