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Wecutgrass
01-26-2012, 04:03 PM
I am meeting with a man on sunday about buying his company and i am wondering how i should go about buying his lawn company from him. He is asking 32,500 for all of the lawns, their is a total of 60 lawns that are relatively close to each other. So that means he thinks each one of his lawns is worth 533.00 dollars. The lawns on average make 30 a cut. There would be a bout 28 mowing weeks in a year where i am from so that totals to 840. None of the lawns have a signed service agreement so i told him i would not just pay him 32500 upfront because that would be dumb i could loose 15 lawns then but out all this money. I said that i would give him 10,000 down and then pay him 30% of each lawn until the remainder of the balance is paid off but once a lawn is cancelled i no longer pay him for that lawn. I was thinking 533 dollars per lawn was a bit expensive, i was thinking more around the 400-500 dollar range. What do y'all think? any help would be lovely.

luis@NJ
01-26-2012, 04:19 PM
Yes, very smart move don't ever buy a business with accounts and no contract you could loose them all! lol What kind of equipment is he giving you? :confused:

Wecutgrass
01-26-2012, 04:24 PM
there is no equipment involved with the 32,500. that is just for the lawns. he does have 2 walkers a 36 and 42 and some handhelds and a box truck. how much should i tell him each lawn is worth? 475? does that seem reasonable?

williams lcm
01-26-2012, 04:42 PM
Years back I had a guy wanting to sell his business to me for around the same price. I said no thanks. I went home printed up flyers and business cards. Total cost under $500 dollars. I made it my full time job to hit every neighborhood with these flyers. They were every where. Then I sat back and waited for the phone to ring. Boy did it ring. I had plenty of work and used my relatives to spread the word. My first year was a sucess. Basically I saved myself 30k. This is just the way i thought of it anyway. I did not want to buy any business just because I was never guaranteed to have the customers after I bought it.

Quality Cuts PLS
01-26-2012, 04:43 PM
The accounts should be worth about 3 months gross max. That is way out of line for just accounts. Is it only eow's?, because here we get around 40 to 42cuts per season.

Wecutgrass
01-26-2012, 04:50 PM
The accounts should be worth about 3 months gross max. That is way out of line for just accounts. Is it only eow's?, because here we get around 40 to 42cuts per season.
eow's? i am not familiar with that term. i figured 4 cuts in may june july aug and sept. totaling 20 then 2 cuts in nov and december totaling 24 and 1 cut in jan and feb totaling 26 then 2 in march april totaling 28. so each account should be worth more around 300?

Wecutgrass
01-26-2012, 04:52 PM
Years back I had a guy wanting to sell his business to me for around the same price. I said no thanks. I went home printed up flyers and business cards. Total cost under $500 dollars. I made it my full time job to hit every neighborhood with these flyers. They were every where. Then I sat back and waited for the phone to ring. Boy did it ring. I had plenty of work and used my relatives to spread the word. My first year was a sucess. Basically I saved myself 30k. This is just the way i thought of it anyway. I did not want to buy any business just because I was never guaranteed to have the customers after I bought it.

i have 10,000 door hangers sitting in my room and that was my plan before this opportunity came up, i was going to pass out all those. if i passed out all those door hangers to a bunch of neighborhoods and then bought the company also, i would have a whole bunch of lawns, i currently have 33 of my own lawns and i cut my friends 20 lawns who's away at college currently and i am a full time student. i just really want to have a bunch of lawns, if the guy doesn't want to go down to what i want to pay for the company then i just want buy it.

KrayzKajun
01-26-2012, 04:53 PM
I talked to tht guy already. None of the yards are on contract. U could take an 1/8 of tht asking price and use it for advertising and get 100 new customers. Its not worth anywhere close to what he thinks its worth. If it was worth so much he wouldn't be getting out.
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Wecutgrass
01-26-2012, 04:54 PM
won't***********

KrayzKajun
01-26-2012, 04:55 PM
Also where did u get 28cuts from? I'm right accross the bridge from u, we average between 38-43cuts a year.
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Wecutgrass
01-26-2012, 04:56 PM
I talked to tht guy already. None of the yards are on contract. U could take an 1/8 of tht asking price and use it for advertising and get 100 new customers. Its not worth anywhere close to what he thinks its worth. If it was worth so much he wouldn't be getting out.
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ya i see where you are coming from, if i spent 30,000 on advertising i could get way more then 100 lawns hahaha. i don't think I'm going to buy it from him, unless he reduces his price drastically.

Wecutgrass
01-26-2012, 04:59 PM
Also where did u get 28cuts from? I'm right accross the bridge from u, we average between 38-43cuts a year.
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i figured weekly for may-sept=20 then 2 in nov-dec 24 1 in jan and feb 26 then 2 in march and april totaling 30. maybe 3 cuts in april totaling 31.

Lefet2
01-26-2012, 05:07 PM
...........

Lefet2
01-26-2012, 05:08 PM
eow's? i am not familiar with that term. i figured 4 cuts in may june july aug and sept. totaling 20 then 2 cuts in nov and december totaling 24 and 1 cut in jan and feb totaling 26 then 2 in march april totaling 28. so each account should be worth more around 300?



FYI every other weeker's

Wecutgrass
01-26-2012, 05:16 PM
FYI every other weeker's

o alright i had never heard of that before. but no the are weekly cuts in season. ima talk to him and see if he will come down to my price. if not there its not worth my time.

KrayzKajun
01-26-2012, 05:41 PM
Mar-Oct (4x cuts a month, sometimes 5x cuts for May,July) Nov(2-3x cuts), Dec-Feb(1-2xcuts)
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Wecutgrass
01-26-2012, 05:54 PM
O my clients don't want it cut that often, some do, but majority don't.
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hackitdown
01-26-2012, 06:05 PM
If I spend $1000 on advertising in the spring, I can pick up 10 new lawn accounts. And they will be 10 good accounts that want to do business with me, on my terms. So good accounts only cost me about $100 each, plus the time to do the selling bit.

3 years ago I bought 11 accounts for about $125 each. All but 4 of them were a disaster. Slow pay, PITAs, EOWs, etc. Not good.

Wecutgrass
01-26-2012, 06:07 PM
You paid him up front for all the accounts?
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94gt331
01-26-2012, 06:38 PM
You'd be stupid to pay that price for that work I would say $5,000 for all that work. I mean nothing is guaranteed plus you need to make some money the first couple years. Print out 1,000 flyers and take a few days and hand them out to resedential neighborhoods and put a ad in a few service classifieds and put your cards around where u can and you will have 60yrds in no time. $32,000 would buy you a nice mowing truck, trailor, and mowers.

Wecutgrass
01-26-2012, 07:00 PM
Alright, I see where you are coming from. I harve the flyers ready to go I'm just waiting for the perfect time to pass them out
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MarkintheGarden
01-26-2012, 07:58 PM
I agree the asking price was way too high for the accounts.

You will be better off cultivating your own accounts.

And do use a simple agreement or contract that will provide the client with assurance and details regarding the service they are getting and you with assurance that they understand and accept the costs for the services.

Wecutgrass
01-26-2012, 07:59 PM
Im not going to buy the company anymore
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lawn care St. Cloud, MN
01-26-2012, 09:48 PM
Not sure if that is going to be the best deal for you...I purchased a list before from a friend who was getting out of the business and I paid $150 per customer which was roughly 1/3 the cost of the total revenue per customer for the year.

Try and build yourself with quality work/marketing.

LawnXperts lawn care St. Cloud, MN

http://www.saintcloudlawncare.com

Wecutgrass
01-26-2012, 10:19 PM
O man thats much cheaper then this deal I'm in. 150 is a much better number then 533. I told him I'm not interested anymore. Thanks for all yalls help! I hope my door hangers bring me some success and good loyal customers
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TheBetterDoorhanger
01-29-2012, 11:11 PM
Thrilled to hear you mention door hangers. We at Adeas Printing think door hangers are a very good investment & our lawn care clients have much success using them. I wanna quickly let you know about what sets our products apart & makes them so special. Our door hangers can be ordered with Band-It and/or Stick-It attached. Band-It is a secure method of attaching them to the door handle and it keeps your ad off the customers lawn. Stick-It is really cool because it allows your customer to stick your advertisement right to their fridge which will keep your name and number within their view. Our prices are really great and we ship anywhere in the U.S. Take a look a look at our web page to learn more:http://www.adeasprinting.com/Door-Hangers

Good luck to you!

Robin Christopherson
A'DEAS Printing
Home of Band-It & Stick-It® Products
www.AdeasPrinting.com
robin@adeasprinting.com
(316) 269-2494 ext. 200
(866) 251-3181 fax
719 S. St. Francis
Wichita, KS 67211

Glenn Lawn Care
01-30-2012, 08:17 AM
Thats seem pretty high just for accounts that are not under contract.

supercuts
01-30-2012, 08:54 AM
i personally find it amusing that $533 was way over priced, and you thought $500 was a fair offer......

glad you choose the smart road and opted not to buy his lawns. my rule of thumb is they are worth the price of one cut, if its a $30 lawn, thats what it is worth. some say they are worth a months gross. i have never bought any lawns though, dont think i ever will.

MOturkey
01-30-2012, 09:41 AM
I feel that purchasing accounts is like anything else, there are situations where it makes sense, and situations where it doesn't. Paying the bulk of a year's gross for non-contracted accounts doesn't make much sense, but if you can purchase them cheaply enough, it is an easy way to expand quickly.

Unfortunately, most people tend to think their "business" is worth much more than it is. A local guy here is moving because of his occupation, and has his business for sale, equipment and accounts. He's asking $35,000. His mowers are 5 years old or older (2). He has a 16 ft trailer, and the usual assortment of handhelds, so if one were being generous, you could say $10,000 for equipment. A friend of mine called and talked to him about it, and he told him he had around 24 accounts. I am familiar with some of them, and am guessing he is grossing no more than $1,500 a week, possibly less. I wish him well, but I honestly believe someone would have to be an idiot to pay that much for the business.

shadrach
01-30-2012, 11:47 AM
No contracts, high price & he keeps his equipment? No thanks.

Wecutgrass
01-30-2012, 12:00 PM
Ya I'm glad I didn't buy that company, I can grow my own company that large for far less then 32000 bucks
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TriCityLawnCareLLC
01-30-2012, 01:35 PM
Glad to hear you opted out of it. I'm going to approach different companies in my area (in the future) about buying them out. When/If i'm able to buy them out, everything will go through a lawyer. They will sign a non-compete form, restricting them from getting back into the lawn care industry. That's the only way i'll do it.

4 seasons lawn&land
01-30-2012, 02:27 PM
for what its worth I think I would pay 4 or 5 cuts worth for each lawn. At $500 per lawn they would all have to be good size. Id also have to talk to them first, every customer, and make sure Im not wasting my money.

Wecutgrass
01-30-2012, 09:06 PM
ya i passed on the offer, i started passing out flyers today as a little tester..i did about 40 blocks in 5 hours and i got 2 calls while i was still passing them out but none yet, today was just a tester, i passed them out in 3 different areas. to see where i get the most call backs from.