Just bought 36 accounts

[EKZTES]

I should probably send a letter out telling them that nothing is changing (except for better service of course), tell them who's in charge, my contact info, etc. Does anyone have any examples of a letter like this? I don't really know where to start.

Thanks in advance.

[KrayzKajun]

i would go introduce myself in person to each customer!!!

[ALC-GregH]

Let m get this straight. You bought 34 accounts and haven't even talked to any of the customers? WOW..... Expect to lose over half if not more. I hope you didn't pay much if anything for them.

[clean_cut]

The letter idea sounds good, it might be a good idea to stop by and talk to them if they're home while you mow too.

[stearns_landscaping]

Let m get this straight. You bought 34 accounts and haven't even talked to any of the customers? WOW..... Expect to lose over half if not more. I hope you didn't pay much if anything for them.

I was thinking the same thing. Most people will not be happy about this and I hope you signed a no contest agreement with him so he doest just start right back up next year and take all the accounts anyways.

[Powerws]

Yeah the krazy Kujun is Crazy

[STIHL GUY]

i would speak to them all in person

[thu cutting edge]

i would introduce youself. its a good first impression. i have met with all my property managers and all my hoa citizens, and know them on a first name basis. so meeting with 36 customesr isnt that much to ask for.

[ALC-GregH]

I was thinking the same thing. Most people will not be happy about this and I hope you signed a no contest agreement with him so he doest just start right back up next year and take all the accounts anyways.

That's probably what the dude has in mind to do next year. Heck, he might have already sold them to someone else and is getting paid twice.

[ALC-GregH]

For the record, I'd NEVER buy out another lawn companies customer list. If I can't gain customers on my own then I'm in the wrong business.

[Hanau]

I should probably send a letter out telling them that nothing is changing (except for better service of course), tell them who's in charge, my contact info, etc. Does anyone have any examples of a letter like this? I don't really know where to start.

Thanks in advance.

Dude, you did what?

[zturncutter]

OMG Why didn't the other guy send out a letter and introduce you personally ? :hammerhead:

[Kutz Lawns]

OMG Why didn't the other guy send out a letter and introduce you personally ? :hammerhead:

That's what I was thinking too, I hope all goes well for you with the new purchase!

But definately go see all of them personally and introduce yourself & definately do a better job than the other guy did & maybe you won't lose any of them.

Good Luck

[DJJS]

talk to them in person if you havent already spoken with them you're probably going to lose 10-20 of those customers if you want to salvage as many as possible, talking to them in person is the best way to go

For the record, I'd NEVER buy out another lawn companies customer list. If I can't gain customers on my own then I'm in the wrong business.

gotta agree with him

[lilweeds]

I did the same thing earlier this year and only lost 3. Most were happy they didn't have to look for a new provider. THe 3 I lost I didn't have to pay for either :)

[procut]

Sounds like you did it backwards. When I bought some accounts a few years back I met them all FIRST and then only paid for the ones who signed with me.

[J&R Landscaping]

I would have wanted to be introduced during or right after the purchase! I would meet with them face to face.

[THEGOLDPRO]

you guys scared him off

[Stillwater]

I should probably send a letter out telling them that nothing is changing (except for better service of course), tell them who's in charge, my contact info, etc. Does anyone have any examples of a letter like this? I don't really know where to start.

Thanks in advance.

Thats not JOB#1, before money changed hands you needed to drive to each and everyone of those accounts with the guy your buying from for a introduction and confirmation with the customer, then you follow up formally with a letter. but forget the letter for now it is not to late so get moving with the seller and start meeting your new customers ASAP like right now drop what your doing

[Stillwater]

have you left yet?

[coqui landscaping]

Dude, you did what?

that is the funniest thing i have seen lol lol lol lol not you r situation man the picture FACEPALM

[PLS-Tx]

No way would I do this. Not saying I would not buy accounts, but I would want to know the customers ok with it before I handed any money over.

I hope it works out for you. I would be doing what has already been said and meeting with them asap.

I had a guy want to see us some accounts, about $115,000 per year, for $30,000. I passed, they were to spread out for me.

[AdamChrap]

I feel the only way to "Buy Accounts" is on a percentage basis. Example:
8% of sales for year 1
4% of sales for year 2
2% of sales for year 3
Or whatever you come up with but basically you only pay the guy a percentage of the customers that stayed with you.

[Lotus Landscaping]

I know this thread is a month old, but here is an example letter that I sent out on behalf of a company that I purchased accounts from a couple of years ago.



Former Lawn Maintenance Co.
XXXXXXXXX
XXXXXX, CA 959XX


October 1, 200X







Dear Valued Customer,

After much thought and deliberation, I have decided to accept an exceptional job opportunity in the (XXXXXXXX) area.

Effective October 1, (your company name) will be taking over my landscape maintenance route. The owner is a personal friend of mine that has been in business for over (X) years. I have great faith that (your company name) will do a terrific job of serving your needs. Enclosed is his card for your pleasure.

Thanks again for letting me serve these past few years.

Best Regards,

XXXX XXXXX
(Previous) Lawn Service
XXX-XXX-XXXX

[kootoomootoo]

For the record, I'd NEVER buy out another lawn companies customer list. If I can't gain customers on my own then I'm in the wrong business.

You are in the wrong business.......7 figure co's do this all the time....6 figures co's dont get to 7 figures and wonder why.

[360ci]

Sounds like you did it backwards. When I bought some accounts a few years back I met them all FIRST and then only paid for the ones who signed with me.

That's what I would have done as well.

Business is business, and bad business isn't the business you want to be in!

[Caterkillar]

You are in the wrong business.......7 figure co's do this all the time....6 figures co's dont get to 7 figures and wonder why.

I agree. I guess we have to remember most of these guys that say they would NEVER buy another business probably are working out compact truck pulling a 5x8 trailer with a walk-behind... and then offer the lawnsite community how to run a business.

[360ci]

I agree. I guess we have to remember most of these guys that say they would NEVER buy another business probably are working out compact truck pulling a 5x8 trailer with a walk-behind... and then offer the lawnsite community how to run a business.

I concur. However, irregardless of client count, I'm still content on pulling a 5x8 with a walk-behind, lol! Part time business works just fine.

[Caterkillar]

I concur. However, irregardless of client count, I'm still content on pulling a 5x8 with a walk-behind, lol! Part time business works just fine.

Nothing wrong with that! I just have feeling some of those people basically calling this guy an idiot for buying accounts do not have the qualifications to do so.

[360ci]

Nothing wrong with that! I just have feeling some of those people basically calling this guy an idiot for buying accounts do not have the qualifications to do so.

Don't I know it. I've had my good deals and bad deals over the years as many have had. Sometimes if a deal is good, you don't want to pass it up and miss out on it. On the other hand, sometimes it's a good price for a reason. If I was unsure of how to spend my money, I'd most definitely get advice, but as I am the person I would turn to for that particular advice, I'd more than likely mull it over for some time and pick apart the good, the bad, and the ugly before I go ahead with any purchase.

I've been seeing it quite a bit over the last couple years though. People selling their business "turn key" with "excellent clientele" followed by the phrase "easy money". The last one, if I recall it correctly, advertised a business for sale, including a beat up truck with trailer (both required work to pass safety!), 78 residential clients (unspecified lot sizes), 13 'larger' commercial clients plus all lawn care tools (quite the list, but everything was at least five years old). Anyway, he wanted $210K for it all! I would have phoned him and offered $25K just for the clients, providing they were wanting to change ownership which is still a great deal and I would've told him to keep his truck and equipment. However, I'm not that nice and hold my opinions to myself in matters such as that. It is however, good for a laugh at least. Even $25K is rather steep since in about two years, I can build up to that many clients if I had the time to do all the work. Nuts!

[jasonnau]

For the record, I'd NEVER buy out another lawn companies customer list. If I can't gain customers on my own then I'm in the wrong business.

I bought 12 customers for $500.00 from a guy. I still have at least 4 or 5 of them after 5 years. I just wouldn't buy them now. I'd buy them in the spring when they don't have any time to think about it. And not only did the guy I buy them from speak with each one telling them that I would be taking over, but as soon as he had spoken with them, I personally met all of them. And hell, it was $500.00. Seemed like a no brainer for me in my 2nd season.

[Caterkillar]

Don't I know it. I've had my good deals and bad deals over the years as many have had. Sometimes if a deal is good, you don't want to pass it up and miss out on it. On the other hand, sometimes it's a good price for a reason. If I was unsure of how to spend my money, I'd most definitely get advice, but as I am the person I would turn to for that particular advice, I'd more than likely mull it over for some time and pick apart the good, the bad, and the ugly before I go ahead with any purchase.

I've been seeing it quite a bit over the last couple years though. People selling their business "turn key" with "excellent clientele" followed by the phrase "easy money". The last one, if I recall it correctly, advertised a business for sale, including a beat up truck with trailer (both required work to pass safety!), 78 residential clients (unspecified lot sizes), 13 'larger' commercial clients plus all lawn care tools (quite the list, but everything was at least five years old). Anyway, he wanted $210K for it all! I would have phoned him and offered $25K just for the clients, providing they were wanting to change ownership which is still a great deal and I would've told him to keep his truck and equipment. However, I'm not that nice and hold my opinions to myself in matters such as that. It is however, good for a laugh at least. Even $25K is rather steep since in about two years, I can build up to that many clients if I had the time to do all the work. Nuts!

You should have made the offer. People are usually absolutely insane when they come up with their pricing for their client list. Most of the time they are not selling a turn key business that will operate without daily interaction... I think this inherrently makes the value of the business much less than a typical business. I TRY to pay 10-15% of gross revenue. What the seller's do not understand initially is, NOBODY has cash. With financing the way it is now, it is a buyer's market.

I spend 40k a year in advertising, but that still does bring the growth I would like... especially in these turbulent times where client turn-over is increased.

I have learned there is no such thing as a perfect client list. Plan to lose 30% of the clientel. Next time a seller tells me their client list have no complainers, late payers, and his clients are angelic in every way... I am going to start dropping percentage points in the negotiations.

[lifetree]

... WOW ... Expect to lose over half if not more. I hope you didn't pay much if anything for them.

Sounds about right !!

[lawnman_scott]

Sounds about right !!

Do you speak from experience or aimless thoughts?

[Caterkillar]

Sounds about right !!

And what is your yearly gross?

[Mahoney3223]

I've bought out two companies accounts and some of their equip. In both cases, the previous owner introduced me and called each one of them himself telling them about the switch. I never lost one over the course of the season I bought them. I bought some in 06 (bought 8 accounts from a friend) and I have since lost all of them BUT I recouped my investment and then some and I bought out 22 from a company in 07 and have lost 3...one of them was a 15,000 year church and I've had it since...so it cost me two thousand to make 30x that??? it's not always a bad thing you just have to be careful and make sure the customers at least give you a shot if you lose them then you don't deserve them anyways. this business isn't hard it's about effort!

[Yater]

And what is your yearly gross?

WTF does that have to do with anything? A homeless guy knows that nothing is guaranteed, including a contract. I hope the OP looked over the current contracts and understood the stipulations involved before he handed over the money.

[Yater]

double post

[Caterkillar]

WTF does that have to do with anything? A homeless guy knows that nothing is guaranteed, including a contract. I hope the OP looked over the current contracts and understood the stipulations involved before he handed over the money.

It has alot to do with it!!! Do you want to take advise from a guy that runs a million dollar gross or a 25k gross that lives in him mom's basement?

I mean honestly, how much experience do think a guy with 50" Dixon has on business acquisitions?

[supercuts]

What happened to the guy that posted this? Whats the outcome? How much did you pay? How many accounts?

[stressed]

depending on how much you gave for these accounts i dont think its dumb to buy accounts.Ive personally never had to but some guys need that boost.You need to talk to each customer you bought asap.Tell them that you will be taking over for blah blah and that you will do a great job for them.Tell them the whole deal that you paid the guy and everything..that way if the guy trys to approach them again they will know wut hes doin.And yes you always want to get a no compete contract before you do that.

[zturncutter]

What happened to the guy that posted this? Whats the outcome? How much did you pay? How many accounts?

According to his stats on his profile page he only posted one time, I hope he did not get totally ripped off.

[traviswalker007]

Send them a letter and let them know that you will be servicing them this year along with a letter from there previous provider and you will have no problems.

[Golfpro21]

so if I pay a guy to cut my grass and clean up my leaves, maybe even clear my snow......he has the right to sell me to someone else......I would be pissed.....only way I would buy contracts from someone...is if all accounts agreed to it before hand....hope you don't lose your shirt

[zturncutter]

......I would be pissed..... A lot of times they are.:)

[PetesLandscape&Supply]

I bought 12 accounts of a guy about 6 years ago along with his mower and blower and a couple other items for $3500.00 my requirements were that I would go with him and visit each customer and see how they felt about me taking over , he was to work for me for 7 weeks and I paid him $500 a week plus his hours till paid in full, I still have 7 of these customers to date. How could I go wrong when there mowing bills basically paid for the new accounts.....pete

[kootoomootoo]

Offer to give them the 3rd cut for free......you are trying to gain some traction and a little bit of goodwill goes also goes a long way.

[HenryB]

For the record, I'd NEVER buy out another lawn companies customer list. If I can't gain customers on my own then I'm in the wrong business.

I really disagree with you guys I've bought over 50 accounts over the years and lost three. A good route takes a lot to build. I'd pay 6 months gross for a good route in a second. A smart business man or woman would see that. Maybe areas are different but here a tight route w/chemicals would fetch a good buck.

[EKZTES]

This is a wayy belated response, but for those that might still read this, here it goes. When I started reading these responses, I did get a little nervous. I stopped reading this thread when it was two paes long. I was surprised to see that there was 3 more pages of posts. I did take most everyone's advice and talked to all the customers. Also came up with my own letter and sent it out.

In regards to how much I paid for the accounts, I paid $3,000 for the 36 accounts. The average account is $37, ranging from $15-280/cut.

Here are some statistics to show how this acquistion has gone so far:

1 - cancelled the day after i met them, ouch

1 - cancelled later, but it was mostly my fault

3 - serviced their lawn for the remaining 2 months and havent heard a peep from them. no payments, no returned phone calls, nothing. but i havent given up. luckily these are lower end clients and not the 280guy

31 - happy, good paying customers. I get way more compliments than I think i deserve

In addition to that, I've made plans to do shrub trimming and mulching for about half these clients. Also, I've agreed to do snow removal for 13 of these clients, which the previous guy didnt do.

Thank you to all of those who supported me. So far this has not been a "double facepalm" situation

[Caterkillar]

This is a wayy belated response, but for those that might still read this, here it goes. When I started reading these responses, I did get a little nervous. I stopped reading this thread when it was two paes long. I was surprised to see that there was 3 more pages of posts. I did take most everyone's advice and talked to all the customers. Also came up with my own letter and sent it out.

In regards to how much I paid for the accounts, I paid $3,000 for the 36 accounts. The average account is $37, ranging from $15-280/cut.

Here are some statistics to show how this acquistion has gone so far:

1 - cancelled the day after i met them, ouch

1 - cancelled later, but it was mostly my fault

3 - serviced their lawn for the remaining 2 months and havent heard a peep from them. no payments, no returned phone calls, nothing. but i havent given up. luckily these are lower end clients and not the 280guy

31 - happy, good paying customers. I get way more compliments than I think i deserve

In addition to that, I've made plans to do shrub trimming and mulching for about half these clients. Also, I've agreed to do snow removal for 13 of these clients, which the previous guy didnt do.

Thank you to all of those who supported me. So far this has not been a "double facepalm" situation

31-5 ratio. You retained 85% of the customers. With any business venture there is risk. Sounds like you made the right choice.

[Cummins343]

i would go introduce myself in person to each customer!!!That's what I did when I bought a couple. Let them see your equipment first hand, and let them see you in person. First impressions are a key!

[Golfpro21]

that's great news....congrats......seems you turned the $3000 into a solid investment......there's hope for the rest of us

[AdamChrap]

Looks like you did well. Glad it worked out.

[echeandia]

For you guys who have bought accounts, how did you find them?