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  #1  
Old 08-25-2009, 10:01 PM
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jada86 jada86 is offline
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Location: Naples, Florida
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To Buy or Market?????

I have an opportunity to buy 60 lawn accounts for $20K with $5000 in income. They are grouped nicely and in the area I would like to work. I am basically reopening a landscape/tree service business that I was forced to close in late 2007 due to lack of work. Our economy really took a dive and by that time I had gotten out of lawns and gone 100% tree service, so no bread and butter income to survive the low. (Yes, my mistake....)

Anyway, I have a lot of experience in marketing my business and have had great success in growing my previous lawn business in a stable or high economy. However, I'm not sure exactly what the market will carry these days as I've been away from it for almost 2 years now.

The other option is to put $5k-$10K into marketing and use the balance equal to $20K for monthly income while I build up to 40-50 lawns as my start point. I would be free to take them on whenever they came and just keep marketing every day.

Can you all please give me your opinions and pros and cons you see with both ideas?
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  #2  
Old 08-25-2009, 10:11 PM
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Raven386 Raven386 is offline
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Do all 60 customers have a contract and are they willing to be switched to new management and a new company. I'm sure the guy has built a relationship and knows what certain people want done at their property. If they aren't on a seasonal agreement/contract then they are free to go find someone else if they don't like what you are doing. At least if they were signed for a year, you would have the remainder of the season to build up a relationship and know what they expect to be done. Show them that nothing has changed but the name.
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  #3  
Old 08-25-2009, 10:17 PM
golfnpreacher golfnpreacher is offline
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Unless they are commercial accounts (or possibly ultra high end residential) I would say go with the marketing aspect.

My thought is this... why are they being sold. If there is a company going out of business, someone somewhere is going to pick those accounts up. If they were so profitable, then why are they going out of business? And if they aren't going out of business, why are they being sold? Residential properties come and go to easy to trust buying them.
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  #4  
Old 08-25-2009, 10:30 PM
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Raven386 Raven386 is offline
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Quote:
Originally Posted by golfnpreacher View Post
Unless they are commercial accounts (or possibly ultra high end residential) I would say go with the marketing aspect.

My thought is this... why are they being sold. If there is a company going out of business, someone somewhere is going to pick those accounts up. If they were so profitable, then why are they going out of business? And if they aren't going out of business, why are they being sold? Residential properties come and go to easy to trust buying them.
The owner of the company could have gotten to the point where he can't physically handle operating the company anymore. He could be moving to a different state. There could be a lot of reasons why he is wanting out of the business. It could've been a partnership gone awry. I think you need more information before you do either.

Contracts make or break this deal. Without them every single customer is free to go find the cheapest service to do the mowing. You would need to have a lawyer draw up an agreement and an accountant look at the books to make sure everything is on the up and up. I would have a non-compete clause made so in case the business owner decides he wants back in he can't go to all the customer and take them back.
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  #5  
Old 08-25-2009, 10:38 PM
golfnpreacher golfnpreacher is offline
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Before you buy an account, it is wise to make sure the account can be sold or transferred. Most accounts have an escape clause that allows the customer to find another provider if the business is sold.

And while there are various reason a person would attempt to sell account, the bottom line is those accounts are going to go somewhere. If no one buys them, they will find someone to service them. The value of "buying" accounts is not having to spend the time and money to market for them.
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  #6  
Old 08-26-2009, 06:36 AM
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jada86 jada86 is offline
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The owners are moving far out of state because the wife does not like Florida. Yes, I have a lawyer advising me. With the income there I could lose 2/3 of the accounts and still make what I make today working at my job. I am very savvy with customers and sales so I am pretty confident I can jump through the transition. I'm also good at building referral work what I have. There are no written contracts which does concern me but in the same sense and it seems here in Fla. hardly anyone does contracts for lawns anymore, for residential. I personally will get contracts in place eventually but after I prove myself.
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  #7  
Old 08-28-2009, 03:30 PM
sancho_man_orlando sancho_man_orlando is offline
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I've been doing contracts in Orlando for years... I would not do it any other way.

It takes a good salesman to convince you no one is doing them.
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