What are these accounts worth?

Discussion in 'Starting a Lawn Care Business' started by E & J Pro Turf, Jul 26, 2007.

  1. E & J Pro Turf

    E & J Pro Turf LawnSite Member
    from Midwest
    Posts: 122

    14 accounts making gross of $ 600.00 per week just for mowing. No contracts current operator has had them for 7 yrs. 2 comm 12 res.

    Whats a fair price for both? And how would you work pay out?


    Thanks for all the help.
     
  2. All_Toro_4ME

    All_Toro_4ME LawnSite Bronze Member
    Posts: 1,578

    We need more information then what is given. Instead of an overall price, its better to approach as case-by-case basis. For instance, assuming your 12 residentials are all "average" size, then set a minimum price for them, say $35 each. If they are larger then "average" go more. How large are your comm. accts? On large properties, I generally charge between $80-100 per acre, depending on the height. If trimming and shrubs need to be done also, then charge a minimum per hr to factor those costs in as well. Unless I'm reading your post wrong, there is nothing that says you have to accept the price that the previous lco serviced the accts. for.
     
  3. E & J Pro Turf

    E & J Pro Turf LawnSite Member
    from Midwest
    Posts: 122

    2 acre is $ 120.00 w trimming, I agree its low. They seem to have the other at ok pricing but will need to be raised next yr. They have some that are ok and some that are at $ 40 and should be $ 50 on res. The comm account is tied to 3 res accounts{owners of comm building}. Always think they are paying to much acording to seller. Seller has become friends with some of the customers and has been afraid to raise the price. All chem and shrubs are extra.

    Thanks for the input!!
     
  4. amtrucker22

    amtrucker22 LawnSite Member
    from Florida
    Posts: 69

    This does not sound like a good situation to buy out (season already 1/2 done, customers complain about price, big property underbidded). If you are hell bent on doing it though, I would offer about $1000 - $2000 depending on the properties. I would pay half up front and the other half over the next 3-4 months taking out for any who drop you. Make sure they sign a no compete.

    Good luck!
     
  5. E & J Pro Turf

    E & J Pro Turf LawnSite Member
    from Midwest
    Posts: 122

    They want $ 20,000 for all the accounts. One yr income was what they stated. I was like I don't think that is in the ball park. Do you mean $ 1,000 to 2,000 total for all accounts? Yes I agree its 1/2 way in the season. They want out so bad, but have a false since of what the accounts are worth. Been trying to sell for 3 months. I would only do it to get started in the area and at the right price.

    Thanks Again AM & TORO
     
  6. cpel2004

    cpel2004 LawnSite Bronze Member
    Posts: 1,415

    Nope you would be crazy for offering that price and no way in hell they are going to get 20k at most i would offer 1k-2k thats depending on if they we charging market price to maintain the lawns. I would tell them that the asking price is so unreasonable that you would pass on the accounts.

    Remember, they have them up for sale. More than likely from a mental stand point they dont want to maintain the lawns any more. Give them your offer let them sit on the accounts for a while the season will be over in three months so let them make the next move.
     
  7. westwind

    westwind LawnSite Senior Member
    Posts: 444

    Average lawn accounts up here are worth 2 months of the total revenue. Keep in mind the accounts have to be contracted. You should be provided with copies of all contracts before even considering purchasing. Make sure that these accounts have been clients for more than 2 seasons. I cannot stress these points enough! Good Luck!
     
  8. amtrucker22

    amtrucker22 LawnSite Member
    from Florida
    Posts: 69

    They have been trying to sell them for 3 months because of the price they are asking.

    $20000 is ridiculous. These accounts are not contracted, some have been known to complain about the price they are paying already, and it is late in the season.

    Going prices around here usually run from 1 month to 6 month gross depending on the type of client/properties, time of year, and if they are contracted or not.

    With that price tag there will not be a lot left over for beer and that would be my main concern! :drinkup:
     
  9. All_Toro_4ME

    All_Toro_4ME LawnSite Bronze Member
    Posts: 1,578


    As previously stated, if you really want the accounts, give them an offer and move on and be firm with it. 20k is crazy. It'd be much more cost effective to run ads and do some marketing yourself for new business for res and comm. accts.
     
  10. rudeboy

    rudeboy LawnSite Member
    Posts: 48

    i wouldn't do 20k ether
     

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