View Full Version : Good Advice Please
04-01-2003, 10:51 PM
Alright guys just wandering what yere thoughts were on this one. I have invested about 9k this year on equipment and I am having a hard time getting the clientel to my goals. A good friend of mine that I work with at my regular job would love to come work with me he worked with one of the biggest LCO's for a couple years and he is really good at lawn care. My concern is if I bring him on he will definetly need to be compensated well because his old boss is willing to give up some prime commercial accts. due to downsizing. I guess my questions is should maybe I come up a % to pay him on contracts that he gets maybe like 35% on yearly contracts ( more/less) any ideas?
04-01-2003, 11:27 PM
well I almost hate to answer this but yu asked so, I THINK YOUR OUT OF YOUR MIND. Is he going to pay for 35% of your overhead. You could hire an excelent sales person for a fraction of this. I have almost 20 years experiance in landscaping, irrigation, and landscape managment and I'll come to work for you for 35% of sales. What if you pay him 35% and he underbids a few contracts. I would think 5 to 10% would br more realistic.
Take some time and think this over.
04-01-2003, 11:32 PM
Well you make a very good point I was just thinking if it is accounts that I would know nothing about without him it just seems like he would be worthy of a healthy cut. But maybe then again I could pay him 10-12$ per hour on days where we do accounts he pulled in.
04-02-2003, 12:00 PM
Let see if I have this right.
A friend of yours will come to work with you and bring his own accounts?
And you want to give him 30-40% of gross of those accounts?
For that much I will go work for you.
If you want the accounts buy them from him, the accounts might NOT follow him. Then hire him as an employee. People will say a lot of things with no concrete proof. He can say yeah I'm sure they will come with me but really has never talked to the client about switching over with him. That is just human nature....people just do things like that and really have no bad intentions.
If you bring him in for the accounts...what happens if he decides to go off on his own. You will be back to square one.
Just a thought.
04-02-2003, 01:16 PM
I agree with the last posts. We have sales people that bring in accounts and we range from paying them 5-10% commission, deppending on the account type and visibility. 35% is alot, even if this guy is your friend and is helping start out you should still not pay this much. you can definatly finde some one that will work for 5-10%.
04-02-2003, 02:39 PM
The situation is that this friend of mine used to work for the LCO his is going to give up some accounts he is willing give him the accounts that he used to service. Ok 35% is too much but how can I compensate him for getting these contracts signed to my business. I am not worried about him going out on his own. He is about to go work for the state, and that is what he really wants to do. It is just that he will have free time to do his second choice(lawn care). So in your opinion how should he be compensated you guys are saying 5-10% but if he got me a comm. worth 7000K for the next 7 months his share would be 350$ for 30 or so servicings while mine would be $6,650 trust me I'm not complaining I would love to make that sort of cut. I just don't know if he will go for it being I would not have if without him plus he would be doing half the work.
04-02-2003, 03:11 PM
Why not give him 10-15 of the accounts for a short time only but still pay him his hourly wage. Kind of buying him out but paying for them as you work them.
You will be compensating him for the accounts and also for the manual labor that he will be doing for you.
One more thing 10% of 7000 is 700. Pay him this much not 5%.
I think that you are trying to bundle this whole deal into one transaction. He must get paid for bringing the accounts but he must get paid for manual labor also. Two different transactions.
Look at it that way....it will make more sense and confuse you less.
Just a thought.
04-02-2003, 03:18 PM
Thakyou for all the advice.
GREEN DRAGON LM
04-03-2003, 11:22 PM
5 to 10% tops, he isnt going to pay the extra overhead. Personally I wouldn't touch this deal. keep grinding out on your own!
04-04-2003, 02:04 AM
I'm not sure I understand what you're asking... or maybe you're asking several questions.
1) He's a good landscaper - so hire him for his landscaping
2) Is he good at sales? This is different than landscaping. You do the sales - let him do the landscaping.
3) Is he brining accounts? Then offer to buy them from him based on a % of return from the customer. Back load the deal so that the first 3 mos is the lowest %, more at 6 or 9 months and more yet a 1 year. This will encourage good customer relations as it will reward your friend in the pocket for good referrals and working with you to make sure the relationships are stable for the long term.
04-04-2003, 10:20 PM
That is a good idea, I guess I just need to sit down with him and discuss what he expexting and what he is looking for then I can let him know what I can do for him. Thanx for the reply
04-04-2003, 10:30 PM
You really do need to ask him what he wants, no sense offering him anything if all he wants is a $10 to $12 per hour part time job and a 12pk of beer at the end of the week. But in the event he does want a commission, I agree that 10% of the season income on the accounts he brings, plus a fair hourly wage when he is working should be more than adequate
04-04-2003, 11:04 PM
I personally just don't agree with paying him a percentage for the accounts. There will be nothing but bad blood over the next couple of years with these accounts.
For example: You will tell him how to work on the accounts and he will say that "hey, i brought them here, i can do them how I want them to or I'm going to take them and leave."
04-04-2003, 11:54 PM
Well for one he could not go out on his own or should I say he wouldn't go out on his own due to his wanting to really do something else. Secondly he is a really good guy, who by chance convinced me when I was in doubt that I could do really good. These so called accounts I am refering to are not his, he just has the connections with the second largest LCO in Pensacola who will be turning down alot of work. Once I find out more info I will keep you guys posted.
04-05-2003, 10:50 AM
That is why I recommended buying him out on the accounts completely. The percentage is just to figure the price to pay the accounts. NOT that he will always pay him that percent. He pays him once and the accounts are his. Period.
Just a thought.
LakeSide Lawn and Landscape
04-05-2003, 11:23 AM
I think the whole idea is bad! You say you havent got the cliental to reach your goals which also means you not making the money you want to.Now do you think 3 or 4 accounts that this guy brings is going to change that enough for you to pay him hourly and pay him for the accounts and add work comp. ins.???????I really dont think so.Use your head on this one.Good luck on what you decide.:confused: :eek: :dizzy:
04-05-2003, 11:54 AM
I still think he should purchase the accounts from the owner of the accounts. I am not sure his friend is the owner of the accounts.
He did state that he did not have enough accounts so this is his chance to get some. The guy that wants to work for him will be part time and he should hire him only if the new accounts are too much for him to handle the work himself.
If you don't get the accounts when are you going to grow your clientele. Now some will say why don't you just advertise yourself and get your own....well that takes money also and time. These accounts are here right now. They are ready to produce income. That is if they are priced right.
Keep in mind the accounts and the hiring of the new guy are two different transactions.....he should not bundle them together.
He should get the accounts at a reasonable price and then decide if he needs the new guy.
Most of you are bundling the new guy and the new accounts as one transaction. That is a bad thing to do. And if that is the case and there is no way to get the accounts without the guy then NO...don't do it.
He should talk it with his friend and tell him that he wants the accounts because he needs more work. If he can't handle the new work load then he can hire his friend part time to help.
Buying accounts happens all the time....that is how most companies grow at a faster rate than their competitors.
Now from what I understand this guy is one of the Larger LCO in that area....these accounts might be pretty good. Or who knows they might be Cr@p and he is trying to unload them. Check into that carefully.
One more thing....the poster did state that they were prime commercial accounts....maybe these accounts will bring enough work for the extra guy. After all they are PRIME.
Hope that you can make a wise decision and keep us posted.
Just a thought.
04-05-2003, 12:09 PM
I will after getting input from you guys I have decided to put a flyer insert into the paper for my area. I will put 12,000 in a Sunday paper and see what that brings. I will keep you posted. By the way if any of you have done the insert in paper thing what day seems to be the best Sunday? The paper told me that Wednesday seems to be a very big advertising day also. Thanx
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