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  #11  
Old 05-26-2013, 08:38 PM
dnc19694339 dnc19694339 is offline
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Quote:
Originally Posted by BPS## View Post
Taking your example and the pulling number out of axx route lets do some "lets say".........


Lets say some one has 134 mowing accounts for sale, and lets say they want 2.5 times which comes out to $10,000.
Could you, or could you not spend $10,000 in advertising and probably get 134 accounts from that advertising????

Maybe you only spend $5000 in advertising and get those accounts.

For me personally I'm rather reluctant to buy accounts from a selling out lawn service.
Too many variables as to why they are no longer with you.
Lawn care is highly dependent on personality and like was mentioned the property owner signed on with John to mow his lawn, he doesn't care about the biz name.
You buy John's route and next thing you know Mrs Smith that signed on with John says where is John?
Oh, he sold me the biz. Ok she says, good bye. I don't need you now.
I've seen it happen far too often especially when residentials are concerned.
Commercials not as much.
Good luck picking up that many accounts with $5 or $10k in advertising. Not to mention the time and estimating involved with selling the work. Ive bought out several smaller companies and its always been worth every penny. These were long term customers not 1 or 2 yr customers. Most people are just happy to have someone to do the work as long as the quality you provide is as good as the seller was giving.
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  #12  
Old 05-26-2013, 11:42 PM
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BPS## BPS## is offline
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Quote:
Originally Posted by dnc19694339 View Post
Good luck picking up that many accounts with $5 or $10k in advertising. Not to mention the time and estimating involved with selling the work. Ive bought out several smaller companies and its always been worth every penny. These were long term customers not 1 or 2 yr customers. Most people are just happy to have someone to do the work as long as the quality you provide is as good as the seller was giving.




Thank you for that view point. Its not one that I know any thing about, as I've not bought any other businesses.

And haven't spent $5000 in advertising to see what it got me.
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  #13  
Old 05-27-2013, 12:58 AM
mowing4cash mowing4cash is offline
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I believe accounts are worth 2 months gross depending on the time of year that you buy them. Adding new customers from advertising is alot of work. Lets say you are buying 50 weekly customers at $35 per cut.

50x35=$1750 x 8 weeks= $14k

Now lets say you want to get 50 new customers, well you have to have 90 leads from advertising to get 50 customers.

Lets just say you end up spending $100 per customer = $5000.

Now you have to estimate them, do the first time cuts which normally takes double the time, they are not going to call all in the same week. Of course they are going to be a tuesday customer but the sign up on Wednesday so now you have to go out of the way to cut them on Thursday and then try to get them on the schedule. And alot of other time just getting a new customer started.

Then you have to upsell them on other stuff where as with a customer list that you bought hopefully you will already have some of the upselling done and the past history of what that person has bought.

So you see paying $14k over time seems alot better then spending $5k and hoping to get those 50 new clients.
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  #14  
Old 05-27-2013, 06:54 AM
grassmasterswilson grassmasterswilson is online now
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All great advice. I've done a few direct mailers and had great success with them. My new additions are coming mostly from Fert and squirt and not mowing. Don't get me wrong, I love to get the Fert and squirt people since this is the side I like and work mostly in. But for someone trying to get out of the mowing truck and on the sprayer and in the office it's been slow getting mowing accounts.

Unfortunately I've had very little success buying up other companies. Some have been a real headache trying to get the financials and others I was upfront at the terms of the deal I was willing to offer.

What I'm seeing is everyone thinks there business is gold and won't take a payment deal based on retention.
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  #15  
Old 05-27-2013, 10:47 AM
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Efficiency Efficiency is offline
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Quote:
Originally Posted by BPS## View Post
Thank you for that view point. Its not one that I know any thing about, as I've not bought any other businesses.

And haven't spent $5000 in advertising to see what it got me.
In which case, why comment?

For sake of discussion, my mowing and upsold services are for sale (no fert in this deal). Business without fertilizing services does $300k and has free cash flow of $70k per year. That makes the business worth $140k or better in my mind. (Plus assets) using you 2 months gross of mowing values the company around $50k. Pat, see why you are having a hard time buying account?
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  #16  
Old 05-27-2013, 01:35 PM
grassmasterswilson grassmasterswilson is online now
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Originally Posted by Efficiency View Post
In which case, why comment?

For sake of discussion, my mowing and upsold services are for sale (no fert in this deal). Business without fertilizing services does $300k and has free cash flow of $70k per year. That makes the business worth $140k or better in my mind. (Plus assets) using you 2 months gross of mowing values the company around $50k. Pat, see why you are having a hard time buying account?
I totally agree with you. The value is in the eye of the beholder!!!

The two deals I have lost in my mind came down to the method of payment. I'd be happy to pay you the 140k for your business if you were willing to base it off of customer retention and those who were ok with the switch. I also don't have 140k and would like to make payments and be paid off within 12-18 months.

The two guys I dealt with wanted upfront payment and that is a risk I'm just not going to take. What if half the list does t want my service?

So in my mind I'd be glad to pay a premium if you would take payments and base it on retention. If you wanted the money upfront then the value drops to me since you should expect a fair amount of customer loss.
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  #17  
Old 05-27-2013, 02:57 PM
Stillwater Stillwater is offline
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I believe in outright takeing them.... not buying them. Flame away.....
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  #18  
Old 05-28-2013, 02:51 PM
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Efficiency Efficiency is offline
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Quote:
Originally Posted by Stillwater View Post
I believe in outright takeing them.... not buying them. Flame away.....
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And how do you accomplish this?
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  #19  
Old 05-28-2013, 09:23 PM
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BPS## BPS## is offline
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Quote:
Originally Posted by Efficiency View Post
In which case, why comment?

For sake of discussion





You answered your own question.


Besides where in the site terms of service does it say that I must ask your permission before posting?
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  #20  
Old 05-28-2013, 10:06 PM
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Efficiency Efficiency is offline
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See, it means nothing to anyone if you are not sharing personal experiences. What you did is called talking out your arse.

My "sake of discussion" is a real life situatuon.
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