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View Full Version : What are these accounts worth?


pickupman96
12-13-2011, 01:37 PM
I am looking a buying some accounts here in my area. WHat im looking for is how much are they worth, and what is the best way to go about buying them as far as payment schedule. He wants it all up front but i dont like that. There are 23 weekly mowings that do $1100 per week. There is also a list of about 15 other name that have other work done, cleanups, trimming, ext. He gave me a excel sheet that shows $59410 revenue and $6111 in expenses from April- October of this year. Also include is a contract for a condo complex for next year that $20,000 plus materials. That includes spring/fall cleanups, mulch and weekly mowing. He is asking $20,000. What do you guys think and what should my next move be? I just really need more accounts to be able to make a living doing what i love and its either buy the the accounts of take a chance and spend the same amount in advertising.

Dr.NewEarth
12-13-2011, 02:40 PM
First, do a search on this site for comprehensive answers.

The thing with buying contracts worries me. Is this a licensed company?How long has he been in business? Why is he selling a "client list?"

You have no assurance that people or an HOA will continue with you.

I believe you need to have every one of "his" clients sign a new contract with "you."
Sorry, but this type of scenario leaves me skeptical.

Relax until after the New Year, and then start advertising to your target demographic then.

wbw
12-13-2011, 08:14 PM
I would want him to go with me and personally introduce me to the customers. This will ease the transition. I would not pay him all up front. He has rapport with these customers and needs to have a vested interest in their staying with you. I would want something like 1/3 down, 1/3 after 90 days and 1/3 after 180 days. I would want to pay the last two payments based on customer retention. Retain 100% of the customers after 90 days pay 100% of the second payment. Only retain 80% then pay 80% of the second payment. Same with the final payment. Of course you want to make this deal near the beginning of the "season".

KrayzKajun
12-13-2011, 09:32 PM
I'm in the same boat. Have a guy getting out due to health reasons. He has 75+ residential accounts, he has been cutting them all for 10+yrs. Problem is no contracts
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pickupman96
12-13-2011, 09:55 PM
I was thinking something like 5k up front and then divide the rest and put a price on the like say $400 per account and only pay for each account i retain after 90 days. But what i really want to know is are the 25 weekly and 1 condo worth the 20k. He has had the weekly residential for 2-3 years

NEW CITY LAWN CARE LLC
12-13-2011, 10:00 PM
I've been offered X-amount of $$ for accounts in the past, the buyer wanted to make monthly payments on his offer for 12 months, and from a sellers stand point, I would not take payments period, if their quality of work is not at-least par to keep each and every customer happy then they will get fired and in turn not pay me, so from my stand point as a seller, if someone wanted to buy some accounts from me, I would want the agreed upon price paid if full at time of transfer....Needless to say I turned him down as he was unwilling to pay upfront..

meets1
12-14-2011, 12:32 AM
Ok, I have done both. Thing is most will stay but this gives them the chance to jump. Now some people might of liked him and didn't bother checking the work. Others may know you and don't like you or company period and they are going to jump. Either way, make a deal, nail down a price and roll from there.

I am again finding myself in buying accounts. I have done this in the past and there is an ad in paper - snow and lawn business, equipment, clients etc. I know the guy, he knows me, we really dont get along but I am calling him tomorrow. We'll see what happens.

wbw
12-14-2011, 10:48 AM
I'm in the same boat. Have a guy getting out due to health reasons. He has 75+ residential accounts, he has been cutting them all for 10+yrs. Problem is no contractsPosted via Mobile Device

Residential contracts are worth zero.

KrayzKajun
12-14-2011, 11:27 AM
I could prolly spend half the money and direct mail target properties and get just as many accounts
Posted via Mobile Device

pickupman96
12-14-2011, 12:59 PM
Thats where im torn. I could spend the 20k or spend 10k advertising. The problem i see is that in my area the market is saturated with illegal LCOs and lowballs. I am starting to doubt that there are 20 accounts to be had in this town of 80k

B-2 Lawncare
12-14-2011, 01:32 PM
Residential contracts are worth zero.

what? ex-plane

wbw
12-14-2011, 03:13 PM
what? ex-plane

Let's say you mow my lawn. You make me sign your contract. I don't like your work (or I lose my job or whatever). I fire you. I pay you for the work performed.

Do you continue to mow my lawn?

If yes...why? I already told you I wasn't going to pay you.

If no, then why would I pay you?

Now do you think you can go to court and a judge is going to make that customer continue to pay you even though you did an inferior (their perception) job. They will say you did bad work when you did bother to show up and that they caught your helper lstanding on the mower looking through the bathroom window while their wife was showering.

You just can't enforce a contract for residential services. You have to make the customer choose to continue to do business with you.

KrayzKajun
12-14-2011, 03:20 PM
Good point
Posted via Mobile Device

Thanksman
12-14-2011, 04:04 PM
Let's say you mow my lawn. You make me sign your contract. I don't like your work (or I lose my job or whatever). I fire you. I pay you for the work performed.

Do you continue to mow my lawn?

If yes...why? I already told you I wasn't going to pay you.

If no, then why would I pay you?

Now do you think you can go to court and a judge is going to make that customer continue to pay you even though you did an inferior (their perception) job. They will say you did bad work when you did bother to show up and that they caught your helper lstanding on the mower looking through the bathroom window while their wife was showering.

You just can't enforce a contract for residential services. You have to make the customer choose to continue to do business with you.well said...