Need Help - What are accounts worth when selling?

Discussion in 'Business Operations' started by bishop65, Apr 10, 2002.

  1. bishop65

    bishop65 LawnSite Member
    from Ohio
    Posts: 6

    Hey guys,

    This is my third year in business and I think I'm hanging up the tools after this one.


    1) bad back- (barely can move at times)
    2) massive competition
    3) being under bidded left & right
    4) Charging the rates that I orginally charged my first year to stay afloat.
    5) Getting married and the new wife thinks the biz is a to much work for what I make!

    My question is what is two years worth of one time clients, & numerous mowing clients worth when selling? I have a list of over 100 one time clients and about 10 regular weekingly mowings.

    Also my equipment is 1.5 years old and is like brand new, what would be the resell value ?

    Thanks for the help


  2. bruces

    bruces LawnSite Senior Member
    Posts: 648

    Equipment - hard to say without knowing what it is, but I'd say probably about 1/2 of new if it is commercial quality in good shape.

    Your accounts - in my opinion, the list of 100 one time customers is worthless. What would you pay for the name of someone who called me one time for mowing?

    The 10 regular customers probably is worth something, but with just 10, unless they are large, it is not enough for someone to buy if they aren't already in the business.

    Your best bet might be to find a competitor in the area and offer the accounts to them for a % of revenue for a certain period of time.

    Good luck, but in my opinion, other that what your equipment is worth, you don't have much to sell.
  3. bishop65

    bishop65 LawnSite Member
    from Ohio
    Posts: 6


    Let me better explain the situation,
    The 100 + clients were not mowing clients. They were mulching, pruning, fall cleanups, etc. Many of these clients call me throughout the season for misc. work.

    Two years of clients aren't worth a dime?

    I was planning on selling everything as a package-

    A 5 * 10 Trailer, 48" scag w/14 kaw, echo gas trimmer, aerator tractor attachement, & alot of misc. tools + two years of clients (ranging from one time -multiple jobs) & 10 mowing accounts for $4,000

    (all the equipment is less then 2 years old and in great shape)

    Is this reasonable or am I dreaming?

  4. tramahor

    tramahor LawnSite Member
    Posts: 82

    I thnk bruce is right, the 100 are still not worth a dime and the 10 accts would depend on how much you make monthly on them to give you a price. maybe 2500 for all.......
  5. shadow

    shadow LawnSite Member
    Posts: 7

    if I were to buy your 100 accounts that are on a on call basis for whatever they want done, who is to say they will ever call?, if there not on a contract they are worthless . No offense but I wouldnt pay a dime for 100 people who might not call me . ya know what i mean?
  6. landscaper3

    landscaper3 LawnSite Bronze Member
    Posts: 1,354

    Around 10% for contrated customers. Equipment mabey 50% value without seeing. Those 100 customers arent worth anthing!
  7. smburgess

    smburgess LawnSite Senior Member
    Posts: 469

    I would say forget the customer list, it's not worth anything. The equipment - take pictures of it and put a price on them and post them on a bulliten board at your supermarket, or put them in the "Trading Post". In the last 6 years I've bought two other lawn maintenance companies, on did $350,000 and one did $150,000. with a customer list you're talking about isn't worth trying to sell as a "stand alone" business, you might be able to sell it to an existing business., but you'll be hard-pressed to get what you want out of it!
  8. MuskTurfKing

    MuskTurfKing LawnSite Senior Member
    Posts: 338

    I'm with the other guys, I wouldn't ever give a cent for someone else's account, I can just as easily go pick up more for free.

  9. bishop65

    bishop65 LawnSite Member
    from Ohio
    Posts: 6

    Thanks for the info-

    One more question,

    My 10 mowing accounts bring in about $1,600 a month, would they sell for around $1,600 & do I have to resign all my customers over to the seller or does he act upon this himself?


  10. John Allin

    John Allin LawnSite Bronze Member
    Posts: 1,489

    At $1600 a month, gross revenue, you might find someone to pay you about $800 for the whole bunch, if they are under written contract for at least one year. Throw in the list of 100 as an incentive....

    On the equipment, I'd say these guys are about right... for the age, maybe 50% of new. Maybe.

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