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View Full Version : looking at a bussines $?


brian gage
03-04-2006, 12:51 AM
hey guys i got an offer on a mowing buss 131 accts trailer & eqipt no truck 4day mow 1-2 for other 80000 no compet through a broker is that fair the route is 2 communitys ?

The landscaper
03-04-2006, 01:14 AM
You should take a look at his books, just to see what kind of income and such he has now. He could be doing all those accounts for dirt cheap and not turning a profit.

brian gage
03-04-2006, 02:37 PM
thanks i have not gone that far but he said hes grossing 7300 &net is 5400 i will work 7 days advertise heavy

nephilim0167
03-04-2006, 04:17 PM
Hopefully you meant to add another "0" on the end of his gross/net profits.

Rich's LS
03-04-2006, 07:16 PM
ANy thought on spliting it and selling half off?????

J&R Landscaping
03-04-2006, 07:35 PM
How long has he been in business and what is his reason for selling? What equipment is included and what is that conditon? Make sure everything is tight because as you know...spring is near and new clients don't like it when you miss their property because your mowers were in the shop!

befnme
03-04-2006, 09:26 PM
remember even though you buy the accounts the customer is not obligated keep you . even if they have a contract and you buy the company the contract is with the prior owner not you.

B&D Lawn Care
03-04-2006, 10:26 PM
Dude you really need to work on your grammar. Try breaking those sentences up with one of these.

befnme
03-04-2006, 10:31 PM
Dude you really need to work on your grammar. Try breaking those sentences up with one of these.

.....who ?

Jdmtnbikr
03-04-2006, 10:34 PM
Dude you really need to work on your grammar. Try breaking those sentences up with one of these.

This site is full of illiterate people, it is kind of funny and scary at the same time. These people run their own business??!?

Precision
03-04-2006, 10:44 PM
the gross is per Month? per week?

131 accts on 1/4 acre resi properties should be grossing 12-15000 monthly at a minimum and that is for mow and blow type situations. or $125- 180K annually.

Now on that gross, I would expect to pay roughly 1 -2 months gross ($12-30K) plus value of equipment. That would be depreciated value mind you.

If the accounts are weekly pay, cut when they call, non-contracted or any other dumb stuff, 1 months gross would be my maximum offer for the accounts.

$80K isn't a price for a lawncare company. They should either sell for $10-20k or in excess of $250,000. The first is buying a job, the second is buying a turn key business with employees doing ALL the work.

Remember, typical net (after salary and everything) is about 10%. So if they business is grossing $150K. Then you have just spend your profits for the next 6 years with the purchase price of the business and that is before interest. If it is grossing $90K you need 11 years just to pay off the purchase price and both of these assume you don't lose any clients.

olderthandirt
03-04-2006, 10:55 PM
DAM, I would have the # in front of my CPA and not on a forum. What kind of bus. LLC, INC, SP ? these are questions you need answers to so that a CPA can put a value on it

B&D Lawn Care
03-04-2006, 10:58 PM
.....who ?
Not you the first guy.

brian gage
03-05-2006, 01:44 AM
sorry about the net/gross that is per month. as for the grammar issue it is not my use of English diction that needs correcting its my typing. thanks for the grammar check!!! . as for running a business I ran a $20m a year car dealer for 3 years . my 1st seven I was the #1 truck salesman in my region. I just sold my over night company and made a substantial profit. I was a land scaper prior to that and I LOVED IT.

brian gage
03-05-2006, 01:59 AM
thanks guys, the reason I put this in this forum and not my cpa is to see if it made any sense at all. I will meet the owner in 2 weeks. when I get down there. This is all on the phone so I forgot a lot of ?s. on monday I will be talking to them again.

PMLAWN
03-05-2006, 05:33 AM
thanks i have not gone that far but he said hes grossing 7300 &net is 5400 i will work 7 days advertise heavy

131 accounts and 7300 gross-- So $55.00 per month per account
Or average of $14.00 per week

Wait it gets better- $5400.00 NET!!!!

That means it only costs$3.66 per job in overhead.

You say you ran a 20mil car dealership (which by the way is really a small dealership) and put this out here, You have got to be baiting us dumb lawnboys to see how many will say yes, spend 80K on it. This can only be a joke.

nocutting
03-05-2006, 11:00 AM
hey guys i got an offer on a mowing buss 131 accts trailer & eqipt no truck 4day mow 1-2 for other 80000 no compet through a broker is that fair the route is 2 communitys ?
My partner and I just bought a 48k gross biz - no cutting for $5000.00 cash, saw the accounts [ 1 deveolpment-42 clients], each property was between 500-2000sq ft. in a condo. 2-clean-ups, 2-trim/shape, 2 ferts, pre in the beds, and roughly 2-oils. some with annuals. In the books we recieved it showed the man hrs per service and actual costs.This guy was chargeing $40 per man hour [ we'll be able to reduce the man hrs in half or raise the return to $80 per hr.]...........$80k?......hope you were gettin a R:usflag: :drinkup: ollsRoyce with that equipment package?

Precision
03-05-2006, 11:51 AM
sorry about the net/gross that is per month.


don't walk, run. RUN AWAY as fast as you can.

My little piece of the LCO world had a high water mark of 52 customers last year if memory serves me right and I did just over 130K in gross.

A lot of my net went into a new (for me) diesel $12K, a 36" ZTR $5500, and other pains associated with growing, not to mention crazy gas prices of $3.40 a gallon. So my taxable net is less than $5K.

There is no way that guy's net is that high. Even as a solo proprietor with his "salary" still in it. My payroll was over $65K.

Did I mention run, run as fast as you can.

offer $8000, not $80K.

brian gage
03-05-2006, 03:08 PM
u guys gave me advise that made sense. the owner is running this home based. just him and his wife nobody else. I will be looking at other buss in Florida. I may startup on my own.as for the auto ind 20m gross for a single shingle American is huge if someone is telling u diff tell him too take out 25000,ave cost per car then look at the #. people think dealers make sooooooo!!! much not.

brian gage
03-05-2006, 03:19 PM
by the way no cutting I live on LI. Moving to FL. last night I was up on this site till400 am. found A guy who sent someone to junktank.com.It was all LI, under buss opts I found some realy good stuff take a look its great.

grass-scapes
03-05-2006, 06:39 PM
remember even though you buy the accounts the customer is not obligated keep you . even if they have a contract and you buy the company the contract is with the prior owner not you.

Ok, I don't understand this. If a customer has a contract with a company (an entity in itself) and it changes hands...the customer still has a contract withthat company. Why wouldn't the customer be obligated to keep you. The contract is with the company, not the owner. Your logic means that if I am financing a car with a bank and the bank is sold to another bank, I am no longer obligated to pay for my car.

befnme
03-05-2006, 07:39 PM
Ok, I don't understand this. If a customer has a contract with a company (an entity in itself) and it changes hands...the customer still has a contract withthat company. Why wouldn't the customer be obligated to keep you. The contract is with the company, not the owner. Your logic means that if I am financing a car with a bank and the bank is sold to another bank, I am no longer obligated to pay for my car.

ok believe what you want to believe , i was just tryin to help .

grass-scapes
03-05-2006, 07:51 PM
I wasn't asking for your help, it was someone else. I was making a statement. If the contract was with the company, then the entities never change no matter who "owns" the company and the contract is valid. Thats just a reasonable assumption on my part. Im not a lawyer so don't misconstrue my comments as knowing legalities of contractual obligations.

Precision
03-05-2006, 10:15 PM
I wasn't asking for your help, it was someone else. I was making a statement. If the contract was with the company, then the entities never change no matter who "owns" the company and the contract is valid. Thats just a reasonable assumption on my part. Im not a lawyer so don't misconstrue my comments as knowing legalities of contractual obligations.

If you are a big conglomerate where the workers are just numbers then yeah you have a point. When the workers are you and one or two helpers, and you are no longer there, the client will get nervous aobout quality and perception is reality.

Besides, try to hold someone to a contract they want out of and you have not performed the services on. I mean they can arrest you for trespassing if you continue to mow after canceling.

Bottom line, enforcement of the term of the contract (especially with a homeowner) is pretty pointless.

Fvstringpicker
03-05-2006, 11:41 PM
If the contract was with the company, then the entities never change no matter who "owns" the company and the contract is valid.

Watch out. You may be dealing with a personal service contract and may be unenforceable. (i.e. similar to an artist, musician, or landscape architect) But whatever the case, the point is already made that you can't really sue hundreds of customers for breach of contract. My suggestion is to make the seller guarantee retention of X % of clients for a fixed period of time and hold part of the purchase price in escrow.

PMLAWN
03-07-2006, 08:33 AM
u guys gave me advise that made sense. the owner is running this home based. just him and his wife nobody else. I will be looking at other buss in Florida. I may startup on my own.as for the auto ind 20m gross for a single shingle American is huge if someone is telling u diff tell him too take out 25000,ave cost per car then look at the #. people think dealers make sooooooo!!! much not.
My dealership comment was based on 20,000,000 / 25,000 = 800 cars for a year, less than 100 cars a month. It all has to do with area but around here that is rather small. The point is that you caught what we were saying with what they were selling and you are moving on. Good move- those #'s did not add up.

howardsells2000
03-07-2006, 01:28 PM
Just testing, disregard.