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Freshcut Lawn Care
02-23-2006, 01:53 PM
Has anyone considered operating a parallel business and sub out work to it.

An example would be to spin off the Landscaping from the entire property care package. It could be set up and operated by another family member.

I realize that there may be duplicate costs, but also the family member, would get their own write offs!

Any thoughts?

TScapes
02-23-2006, 02:53 PM
There was a guy I knew in Atlanta that did this. He had one entire company at one point. Then he started separating them. One for Design/Build, one for Landscape Management, one for Turf Care, One for Tree Work, one for Irrigation, and he had a waste management division too. He ended up selling one or more companies to a couple of his employees, but kept a percentage. Each had their own name.... well each division had the new owner's name-his name. It worked, how well, I am not sure.

I could see the benefit of it. I know someone that works for a national company that has 10 different companies under their umbrella. Each is a free standing company, but they try to use each other as much as possible.

Precision
02-23-2006, 05:36 PM
Has anyone considered operating a parallel business and sub out work to it.

An example would be to spin off the Landscaping from the entire property care package. It could be set up and operated by another family member.

I realize that there may be duplicate costs, but also the family member, would get their own write offs!

Any thoughts?

If you are complete owners of both, no need to sub out, just contract with the appropriate company. Otherwise the accounting will be a real pain and the IRS might just have you for lunch.