seeking advise on a partnership

Discussion in 'Starting a Lawn Care Business' started by nervjiggy, Oct 25, 2013.

  1. nervjiggy

    nervjiggy LawnSite Member
    Posts: 28

    Hello

    My father is going to be scaling back his lawn service next summer and plans to give a friend and I those jobs so we can continue the business.

    The original plan was to do a partnership between the friend and I. I would buy the equipment and he would pay me off till he paid off his half.

    I am having second thoughts now.
    If I'm going to be fronting the entire cost that's not a partnership.
    If I can afford the entire start up myself, whats the point in doing a partnership?

    I only wanted to work a specific amount and he is wanting to do more. So he wants to use the equipment I bought to do work on his own on the side. That is not a partnership either.

    What say you?
    Thanks.
     
  2. easy-lift guy

    easy-lift guy LawnSite Gold Member
    Posts: 3,376

    You are correct, in spite of your father retiring from the business he has left you in an unattainable position.
    I believe you have Two choices. Buy out your fathers share of the business and hirer the friend as an employee for your company. Second choice form your own company and let your dad,friend sort out their own business affairs. I believe a partnership based on the information you have posted will end badly and could hurt your relationship with your Father in the process.
    easy-lift guy
     
  3. jsslawncare

    jsslawncare LawnSite Bronze Member
    Posts: 1,674

    Agreed^^^^^^
     
  4. TuffTurfLawnCare

    TuffTurfLawnCare LawnSite Senior Member
    Posts: 670

    You have no reason to partner with anyone. Business partnerships often fail, look on here, you will see many stories of people who tried it and not only lost a business, but also friends. Business is business and friends are friends. This is why I will not do any work for friends nor go into business with friends.
     
  5. recycledsole

    recycledsole LawnSite Gold Member
    from MD
    Posts: 3,231

    100% NO. Search for 'partnership' on here and see how most of them turn out.
    What is the point if you can do it yourself?
    Your friend can also do it himself. If he cant afford the equipment, he needs to get a loan. He also may not know how to save money, which would be a thing to watch out for if he is entitled to half your profit.
    Even if he had half the money, I would still say no. To me I don't see anything good about the situation except for saving money on equipment.
    Good luck
     
  6. recycledsole

    recycledsole LawnSite Gold Member
    from MD
    Posts: 3,231

    Good Advice
     
  7. Vecchio Lawn Care

    Vecchio Lawn Care LawnSite Senior Member
    Posts: 905

    Look at the history of partnerships. They rarely work. If you want him to be apart of the company hire him as a top foreman or a high position but still under you.
     
  8. johnsonslawnmanagement

    johnsonslawnmanagement LawnSite Senior Member
    Posts: 909

    Only thing you need a partner for is eating a bucket of poo.... And he is going first
    Posted via Mobile Device
     
  9. A. W. Landscapers  Inc.

    A. W. Landscapers Inc. LawnSite Bronze Member
    Posts: 1,287

    You don't need to bring your father's friend in as a partner unless your father's friend is bringing something to the table that you cannot/will not bring to the table yourself.

    I'm not sure why, but I am getting the impression that your father's friend is someone who has been working for your father for a number of years and your father may feel like he owes this employee for the years of dedicated service the employee has provided while working for your father. If this is the case, you need to be very careful with how you proceed. This friend/employee might feel like he has earned a right to ownership of the company as some sort of payback for his years of dedication. This friend also might be an excellent employee but might not be able to adequately fill the role of owner/partner.

    Another thing to consider is what kind of conversations has your father had with his friend over the years…Did he mention any promises of handing the business over to this friend or anything like that? I can see how something like, "when I retire this will all be yours" can give someone the impression that the owner is going to gift them the business upon retirement when the owner may have really meant that "when you buy me out I'm going to retire."

    You really need to be careful with how you proceed. This friend may hold a lot of animosity towards you/the company/your father if things don't go exactly the way this friend has envisioned the "passing of the torch" would occur.

    Sit down with your father and discuss your options. If this friend is an employee, you might want to consider some sort of profit sharing arrangement. If you go this route, make sure that this friend has a complete understanding of how "profit" is determined…a lot of people do not have a clue about what "profit" really is…many people think that if the company charges $100 to mow the lawn and the crew leader gets payed $15 an hour and the two other members on the crew each get $10 an hour and the lawn takes about 1 hour to mow, they think that the company is making $65 "profit" every time the lawn gets mowed. If this employee has a 10% profit share, he is going to be expecting $6.50 for each lawn he mows so he does the math in his head…10 lawns a day times 5 days a week is 50 lawns…50 lawns times $6.50…that's $325 every week per crew…$325 times 3 crews is $975 every week…I only make $429.36 each week (he doesn't really understand that he really makes $600 a week but that's not how much the paycheck is for but that's a different story)…that's over twice as much as I'm making now...I don't have to work anymore…I'm going to be rich. You don't want to have to deal with trying to educate someone like this on how to determine the company's actual profit.

    Discuss the options with your father and then when you have an agreement, document it in writing.
     
    Last edited: Oct 25, 2013
  10. nervjiggy

    nervjiggy LawnSite Member
    Posts: 28

    I appreciate the advise. I should note that the friend I'm referring to is a friend of mine. He's worked with my dad several summers (I told my dad about him). I think my dad probably wants to make every one happy and will likely split up the lawns he doesn't want between us if my friend not willing to take less then 50%.
     

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