Accounts for sale

Discussion in 'Lawn Mowing' started by Coastal Lawn, Jun 30, 2004.

  1. Coastal Lawn

    Coastal Lawn LawnSite Member
    Posts: 16

    I have a question for you senior guys.
    I currently have 25 residential accounts and a local operator I know is going out of business and wants to sell me 15 accounts for one month of service per lawn. Does that sound like a good deal and anything I should look out for? Appreciate any comments.
    Thanks
     
  2. dvmcmrhp52

    dvmcmrhp52 LawnSite Platinum Member
    from Pa.
    Posts: 4,205

    One month per account is not a bad deal but,I would stipulate that payment is to be made at a rate of 33% each month until payed in full for those accounts that continue service with you.
    The possibility does exist that they will find a new provider.
    JMO.
     
  3. GeeVee

    GeeVee LawnSite Senior Member
    Posts: 421

    A months revenue is ok.

    How much confidence do you have in yourself being able to retain the customer?
     
  4. brucec32

    brucec32 LawnSite Platinum Member
    Posts: 4,403

    I would definitely make the payments based on a percentage paid over a period so that he gets less money if customers drop you.
     
  5. awayneward

    awayneward LawnSite Member
    Posts: 22

    I recently purchased 10 bi-weekly accounts. They generate $550.00 per month. The guy wanted $900 for them, I told him that the only way I would pay that for them was to make it in 3 payments. We settled on $600.00 outright and that included a piece of crap Murray rider. I have already mowed them twice and picked up a next door neighbor to one of the accounts. So, I have already made my money back on the accounts. The rule of thumb is 3 times the monthly gross of the accounts. I didn't want to use that formula because I didn't want to invest that much money for bi-weekly accounts.
    The moral to my story is don't be over anxious to purchase the accounts, if you do, then you are sunk. He will recognize that and not be willing to negotiate the price to something that will be good for you. If he is pressing you to make a decision, ignore him some, this will make him think that you are not desperate to buy them.
    Always start low and go up from there. I guarantee you, he is starting out higher than he is willing to take. Be firm and good luck.
     
  6. Coastal Lawn

    Coastal Lawn LawnSite Member
    Posts: 16

    Thanks for all the advise guys , I gave him all the terms you all spoke of and we agreed to break it up over a 3 month period.
    Thanks for the help.
     
  7. gr8cutter

    gr8cutter LawnSite Member
    Posts: 91

    We purchased 15 accounts for 4 weeks of mowing. He kept billing for 4 weeks and we mowed. All the customers are still with us. Had him sign a non compete.
     
  8. GreenDream

    GreenDream LawnSite Member
    Posts: 7

    thats a great deal! Lets face it if customers wern't lazy or too busy we would not have businesses, BUT Customers do not like to shop around, if you are there the same day and charge the same amount you will keep all of them. I would put together a letter thats from the guy that you are buying the accounts from to introduce your self and let them know whats going on. GOOD LUCK
     

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