Propositioned one of my Customers

Discussion in 'Business Operations' started by MainTainZ Property Svcs., Jul 11, 2013.

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  1. MainTainZ Property Svcs.

    MainTainZ Property Svcs. LawnSite Member
    Posts: 172

    Now, this is not what you might think....I have a customer that I've done his weedeating for the last 15 years or so. He's been having me mow for him the last few weeks because his mower, which is a 4 yr. old Scag Turf Tiger w/ 72 inch deck and liquid cooled engine, needs a new battery or ignition switch. He's also getting older and is not able to do as much as he once could. Now this is the proposition: That he give me the mower and I would mow his yard for the next so many yrs. for the mower. He said, "What if you quit the mowing business". I told him that we could do a contract that states if I quit, I have to pay a certain, agreed upon amount for the mower. He then said that it sounded like a good idea and he would think about it. When I first mentioned the proposition of trading the mower for me mowing, I was half heartedly joking and wasn't serious but since he's going to think about it, and the more I think about it, I like the idea. I figure the mower, which still only has about 150 hrs, is worth at least $7000 (he paid $12,500). I would probably write a contract that states that I'll mow his yard approx. 30 times a year for the next 4 years (that's $60 per mow = $7,200 ). If something happens that I can't mow it anymore, I would have the option to pay him the balance remaining on the agreed upon price. What do you all think...?? Good deal??
     
  2. TruSomethingOrOther

    TruSomethingOrOther LawnSite Member
    Posts: 171

    Considering the amount of return on investment is involved, I as well would jump on that idea.
     
  3. jbpo

    jbpo LawnSite Member
    Posts: 46

    Sounds like a good idea especially if you are maintaining some larger properties. The size of that mower would increase your efficiency and you don't have to come up with money out of pocket to get it. I think you got a good deal going. Good luck.
     
  4. clydebusa

    clydebusa LawnSite Bronze Member
    Posts: 1,660

    I would just buy the mower. Your contract would have no increases for 4 years? Gas goes to $10 a gallon and so on. Paid 12.5 k worth as a good deal 6k.
     
  5. dllawson

    dllawson LawnSite Member
    Posts: 172

    If you have a good relationship with this gentleman it could really work out great for both of you. One of my favorite landscape jobs was trading a small installation for a jeep. We both got really good deals, and it led to several paying jobs with their neighbors and family members.
     
  6. Woody82986

    Woody82986 LawnSite Silver Member
    from DFW, TX
    Posts: 2,128

    I would also add into the agreement what happens if and when something should break during the period that you still owe on the mower. This type of thing is good in theory. As long as both of you CYA then I see no real downside. I would probably be hesitant to use the machine much outside of caring for that man's property until it is paid off though. I'd probably try to pay it off within a season regardless.
     
  7. Will P.C.

    Will P.C. LawnSite Senior Member
    Posts: 966

    Go to the drawing board and come up with some strict paperwork
     
  8. RWI

    RWI Banned
    from GA
    Posts: 125

    Sounds like a screw up. Who uses a 72" that doesn't cut 90% commercial properties.
     
  9. Colaguy

    Colaguy LawnSite Senior Member
    Posts: 599

    I would probably write a contract that states that I'll mow his yard approx. 30 times a year for the next 4 years (that's $60 per mow = $7,200 ). If something happens that I can't mow it anymore, I would have the option to pay him the balance remaining on the agreed upon price. What do you all think...?? Good deal??



    Bad deal for you, good deal for him. Mower will depreciate as you mow each yr decreasing its value. Buy it outright or buy something else. Just because its worth $7200 based on whoever's opinion, Dont mean you should pay top dollar. I'd offer 5K based on you mowing his yard in lieu of $.
     
  10. MainTainZ Property Svcs.

    MainTainZ Property Svcs. LawnSite Member
    Posts: 172

    I think the deal will come down to giving the mower a value of $5500. And what some of you that say it's a bad idea don't understand, is that it only takes me 20 mins. to mow his yard. So, I'll mow his yard for 3 yrs (90 total mows) in trade for the mower. Each mow will cost me approx. $20 for labor and gas. So way I figure, I'll have $1800 invested in the mower. Even with depreciation, that's a good deal. Actually, it's a great deal. Also, someone made a comment about why would I want a 72" mower that can't be used on 90% of comm. accts. Well, I don't really know what he's talking about but all my commercial accounts are large properties and a 72" mower and 61" running will really cut down my time. Also, several people said I should buy it outright. Well, why would I want to pay $7200 for something that I can get for $1800 and I want have to put all that cash out of pocket. I'm going to talk to him again this week and I'm going to try to do the deal. I'd be a idiot not to.
     

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