View Full Version : By the numbers...

06-08-2007, 04:46 PM
I'm in the process of buying a business from my old neighbor. I currently own a tshirt website gamedaytshirt.com (http://www.gamedaytshirt.com) which keeps me from the beginning August to the end of March. Pretty much the entire off season of mowing. I'm looking to get a business started and grow it into something quite large.

Please take a look at these numbers and tell me what you think. These numbers are based on three other companies owners that I'm friends with.

2 36" Mowers- $2000
1 48" Mower- $2500
Trimmers/blowers- $400
Trailer- $1000
16 Accounts- $1600
Total- $7500

Break Even Point:
16 accounts at $35 = $1680 one month income after tax= 4.5 months to break even
20 = $2128 = 3.5
25 = $2660 = 2.8
30 = $3192 = 2.3
40 = $4256 = 1.7

Ideal Income Scenarios:
40 accounts at $35 on average (factoring operational costs gas/maintenance) = $34,048 after tax
50 = $42,560
60 = $51,072
70 with one employee at $12 and hour, 2.5 lawns per hour = $48,832
80 = $55,808
90 = $62,784
100 = $69,760
120 = $83,712

I've averaged $35 dollars an hour because I realize that some accounts will be commercial.

My concern are how can I add more business in a short amount of time?

Let me know what you guys think about these numbers.

Trimmer Man007
06-08-2007, 05:05 PM
I think you could possibly get a better price for the trimmers/blowers, but I guess that seems reasonable.

06-08-2007, 05:06 PM
I think I'm buying two blowers and two trimmers.

Trimmer Man007
06-08-2007, 05:15 PM
What model and brand are they? Overall, just in my opinion, the asking price for everything isn't bad, except for the 16 accounts, I wouldn't pay that much a piece.

06-08-2007, 05:38 PM
If the average account size is roughly $35 how much do you suggest I buy the 16 accounts for?

Trimmer Man007
06-08-2007, 05:50 PM
I can't give you a good number, but based on where you live I would assume that like in Colorado you only have a 6-7 month season really, and its about 1/3 of the way through.

06-08-2007, 05:52 PM
I've been told that the season here starts up the last week in March and ends the first week of December. So about 8 months.

Any ideas on how much I should ask for the 16 accounts?

Trimmer Man007
06-08-2007, 06:21 PM
Well unless Kansas City is that much different from Kirkwood Missouri and Denver, I don't really think mowing past the end of October is reasonable. But hey, thats just me.

06-08-2007, 07:28 PM
I'd go with the 10% figure for the accounts.

23 cuts(what I got out of your post) times $35.00 x 16 accounts = $12,880

Multiplied by 10% is $1,280 for the accounts.

Beware that just because you buy the accounts does not mean you will keep them.

Also what kind of mowers? How many hours?