View Full Version : buying out another buissness
06-04-2007, 01:19 AM
Ive been approached by several different companys or solo operaters that are thinking about getting out of the lawn care indistry, all for legit reasons, how do you know if there price is ligit or whats resonable or way to high?
06-04-2007, 06:23 AM
First thing you do is ask to see their past Federal tax returns (3 years min.) which you and your accountant need to review.
06-04-2007, 07:36 PM
I've bought out two companies in the last two years. Around here about one month gross sales is all I would pay and that is only if:
1: they have written contracts. You don't want to buy the guy out and then have all of his customers leave you.
2: tax returns, like stated above. You have to make sure he's telling the truth. If the numbers don't match up then run away. Everyone always thinks that their own business is worth more than is actually is.
3: See if they are willing to drive out to each customer with you and introduce you to them.
4: No compete clause. Make sure they don't just jump back in the next spring and take all of those accounts away from you again.
5: I'm sure there are a lot more things to look at... anyone else?
06-05-2007, 11:16 PM
thanks guys anyone else?
06-08-2007, 05:57 PM
Can anyone send me a copy of a contract you give your customers?
06-08-2007, 06:23 PM
TruGreen pays pretty well, but they requirements. Don't know if they're buying right now or not. Certainly worth a phone call.
06-08-2007, 06:25 PM
Tru Green pays pretty well.
06-08-2007, 06:33 PM
I sold my bizz for my best year's profit....it's a lawyer deal..taxes, etc.
I was lucky, I knew & trusted the buyer & all the suggestions are good.
The "not to compete" could be tricky & a lawyer could write something like
"if the client chooses not to use the buyer or the would-be client is more
comfortable with the seller, this does not fit the "not to " clause.
06-10-2007, 03:22 PM
i have also considered buying and or selling my LCO
RULE OF THUMB IS 3-4 months of gross
30 day stay on / training
non compete for 3-5 years for said accts.
guarantee accts for 90 days
verify acct. cust. & billing
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