Purchasing Accounts

Discussion in 'Business Operations' started by Scag48, Aug 15, 2002.

  1. Scag48

    Scag48 LawnSite Fanatic
    Posts: 6,067

    Hey guys. I was talking to my grandpa today and he informed me that one of his friends that he knows, and older guy, is in the lawn maint. business and is apparently getting out. I don't think he has that many lawns, like maybe 10-15. What I want to know is how you go about purchasing accounts. How do you pay for such an account. I have NO clue on how much to pay for one account. Can anyone tell me how much you should pay or how you would go about purchasing these accounts? Any information would be greatly appreciated. My dad is really into this idea and is pushing me to go for it. Thanks guys!
     
  2. bruces

    bruces LawnSite Senior Member
    Posts: 648

    Talk to him first and see what he wants. If he just has 10 or 15 accounts and is wanting to retire, he my not even want anything for them.

    If you buy them, 1 to 3 weeks income seems to be the going price. You also need to look at the accounts and make sure they are ones that you want.

    Is the price per cut ok?
    Is the location ok?
    Will the customer stay with you?

    If you can make a deal based on paying him from collections, it would be best. That way if the accounts don't stay with you for some reason, you don't pay.

    A lot of people don't like the idea of buying accounts, but I think it can be a way to give to a jump start.

    Good luck.
     
  3. B. Phagan

    B. Phagan LawnSite Member
    Posts: 95

    Some things to consider before buying accounts.......

    1. What is your breakeven point?

    2. Are the accounts profitable?

    3. Do they pay on time?

    4. Do you have a written agreement that holds them in case of "whims"

    5. Will you buy in summer or coming into fall?

    Lots of things to look at before you do the deed. Heard lots of horror stories on this topic!!
     

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