Need Your Thoughts On Biz Proposal

Discussion in 'Starting a Lawn Care Business' started by willjones4, Apr 21, 2008.

  1. willjones4

    willjones4 LawnSite Member
    Posts: 123

    An acquaintance made me an offer today of partnership. I generally run from this sort of thing but I listened a little too long to this one. He wants to supply me with all the equipment (including 2 new Exmark ZTR's) and trailer. He and I both beat the bushes for accounts and I run the work side of things. He will pay for fuel/repairs/maintenance. I can hire help if I want but it will be out of my pocket. The guy is older so he wont be doing much if any of the work. He says he will take 50% and I get 50%. I havent really had time to think about it and wanted to run it past some of you experienced guys. Thanks for your opinions.
     
  2. flattoplawncare

    flattoplawncare LawnSite Senior Member
    Posts: 321

    If i where you i would not do it, You don't need him, I started with basically nothing a 48 scag wb and a lincoln towncar with a 5x8 fleet farm trailer :laugh:
    But now i have everything i need and some just work hard for now.
     
  3. Yater

    Yater LawnSite Senior Member
    Posts: 687

    You'll pay off your half of that equipment shortly and you'll keep paying him for nothing. I'd work out some numbers on buying that equipment from him over time if you deal with him at all.
     
  4. ALC-GregH

    ALC-GregH LawnSite Fanatic
    from PA
    Posts: 7,053

    I wouldn't do it.
     
  5. ALC-GregH

    ALC-GregH LawnSite Fanatic
    from PA
    Posts: 7,053

    damn edit won't work. I meant to say I "would" do it. It sounds like a good deal and you've used it before so you know the mower somewhat. Try to get more work to help pay it off faster.
     
  6. Yater

    Yater LawnSite Senior Member
    Posts: 687


    The thing is he WON'T pay it off. He'll pay for the equipment 10x over and still be paying the other guy 50% of the profit. I'd rather pay off a loan.
     
  7. willjones4

    willjones4 LawnSite Member
    Posts: 123


    That's what I was thinking. I just got stars in my eyes when I heard "2 ztr's". My credit is all screwed up and I can't buy anything. :( I also have no one who I can ask for help. I dunno, there has to be a way I can work this to my advantage.
     
  8. Yater

    Yater LawnSite Senior Member
    Posts: 687

    If you have the customer base to support yourself on 50% of the profit, then you could consider it a loan....BUT, there need to be terms to the loan. You'll need to come up with some numbers (total cost) for this equipment. At some point, the guy has made his money back...then you'll owe him (interest). The numbers are between the two of you but consider what percentage you would pay a bank if your credit is "all screwed up". If you go 50/50 indefinitely, you'll be getting screwed big time in the long run.

    If he agrees to bankroll you, pay him well....but not forever.
     

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