Advice for a newbie

Discussion in 'Lawn Mowing' started by danp, Dec 9, 2002.

  1. danp

    danp LawnSite Member
    Posts: 30

    Hi everyone,

    I was wondering if I could ask your opinion on the deal I am about to pull the trigger on?

    I have the opportunity to purchase a small landscaping company that has about 20 existing accunts, and a full set of equipment for about 25K.

    Here is the package:

    1997 Ford F250 with V-Plow (Great shape, I have seen and driven)

    16' Utility trailer
    Bunton twister mower
    Chain Saws (2)
    walk behind mower
    leaf blower
    vacum
    misc hand tools


    From my research it seems like a good deal, but I am looking for some feedback from the guys who know. Any help is greatly appreciated

    Dan
     
  2. Runner

    Runner LawnSite Fanatic
    Posts: 13,496

    I'm not big on this kind of thing, but that doesn't sound too bad, irregardless of the accounts.
     
  3. danp

    danp LawnSite Member
    Posts: 30

    Thanks Runner,

    I have been spending a fair amount of time working on the opportunity and believe there is an opportunity to utilize the initial client base to give me the initial push. I was hoping I had been looking at it through clear lenses, and not just through the fog of enthusiasm.

    I appreciate the feedback.

    Dan
     
  4. Runner

    Runner LawnSite Fanatic
    Posts: 13,496

    I'll tell you ONE thing is for sure, I don't know how much experience you have plowing, or if you've owned a plow before, but that plow on that is the ultimate in plows. Is it a 9'2""? If you've ever plowed with a straight plow before, once you have a V plow, you'll never go back to a straight. These are just so much more productive. I will do CIRCLES around a straight plow. Just no comparison. The only thing is, is that it is HARD on a truck! And I mean BIG TIME!!! Be ready to repair some damage, because that is the inevitible. I have no doubt that this truck will handle it, as this is one of the FEW newer trucks that will. I'm not a Ford man, but I know that these Ford frames will definitely take more than the other trucks out there. The newer Chevys will waffle out of shape in no time if they're not the HDs. I hope you do all your own mechanical work, because this is the only way to do it on a commercial basis.
     
  5. Sean Adams

    Sean Adams LawnSite Gold Member
    Posts: 3,597

    This is discussed here a lot. The issues are the value of the equipment and the accounts as well as the truck.

    If you have $25,000 to spend, what could you do with that money for your business? Could you finance the truck and equipment and have working capital to grow and market your business? Something to consider....
     
  6. f350

    f350 Banned
    from mi
    Posts: 424

    cash flow,,, thats what you need. with no customer base and no idea how to run or manage a profitable lawncare operation, the last thing you need is a $10,000 mower. with cash flow available you can, spend the right " type " of money of marketing, survive through a drought and costly mistakes.. example, lets say you pick up 10 customers, you sharpen your mower blades, while putting them on you fail to realize they are on up-side down.. excited and full of pride you rush out to cut those 10 lawns.. 4 days later your on top of the world, felling like you made a million bucks.. then out of nowhere 10 calls in a row... you burned my grass, yadayadayada.. now you are left with zero customers and ruined reputation in that neighborhood..
     
  7. danp

    danp LawnSite Member
    Posts: 30

    Sean & 350,

    Both of your comments make good business sense, I researched the value of the truck (fairly easy to do) and the equipment (a little more difficult) and based on what I have found the truck and equipment have a value of at least the 25K so I would basically be getting the customers for nil.

    There is a two man crew in place that has been working the accounts, and I plan to keep them on board for continuity sake as well as there knowledge base.

    The other issue of cash flow is a good one, fortunately the current owner is willing to take 15K up front and finance the rest of two years at 0%.

    These are great comments, keep em coming.

    Thanks Again

    Dan
     
  8. Russo

    Russo LawnSite Senior Member
    Posts: 287

    Looks like a good deal with the info provided. Do what you're heart tells you and be aware of the opportunity costs as well.


    If I had $ 25,000 "extra" , heck ya. But If I had to borrow it to start a business, especially one like this which cost so little to enter, forget about it. Everyone has their own comfort level.....


    If you can buy a $1,000 elephant for 600 bucks, that don't mean you should.


    Just some food for thought, Jon
     
  9. ahah

    ahah LawnSite Member
    from 5
    Posts: 70

    If the customers aren't under contract, the only thing you are guaranteed is used equipment.
     
  10. danp

    danp LawnSite Member
    Posts: 30

    Ahah & Russo,

    I appreciate the response, I woun't have to borrow 15K upfront cost, and the current owner is going to spot the remaining 10K over a 2Yr payback 0%.

    About half of the accounts are under contract, and the rest are customers he has had for an average of about 4 yrs. I am planning to utilize the current crew, and get myself in front of the customers as the new owner to keep the continuity, and hopefully the accounts.

    Comments very much appreciated.

    Dan
     

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