Accounts value

Discussion in 'Lawn Mowing' started by TJ1, May 17, 2002.

  1. TJ1

    TJ1 LawnSite Member
    Messages: 5

    I'm just a little confused when you determine the value of accounts that are for sale the general rule of thumb is your yearly gross generated by these accounts multiplied times three Is this correct?
    Thanks for any reply.
  2. CLM1103

    CLM1103 LawnSite Member
    Messages: 75

    I wish!
  3. KDJ

    KDJ LawnSite Senior Member
    Messages: 325

  4. Dennis E.

    Dennis E. LawnSite Senior Member
    Messages: 349

    My son,you have much to learn!!:D ;)
  5. nu83

    nu83 LawnSite Member
    from omaha
    Messages: 238

    yea its not even close to that, it varies alot by market conditions. I would probably be willing to pay 1/2 year earnings if they were on contract. Also, if I were buying accounts I would work it so I would only buy the accounts that stayed.
  6. wolfpacklawn

    wolfpacklawn LawnSite Member
    Messages: 120

    The gross of an account is meaningless. What is the net of an account. That shows its value. I wouldn't pay 1 cent for an account thats gross is $10,000 a year if it costs $9,000 to do the work
  7. P&J Lawncare

    P&J Lawncare LawnSite Senior Member
    Messages: 531

    In this buisiness accounts are almost worthless in value due to the fact that they are not legally transferable from one company to another (a contract is broken once a third party is involved unless all three parties agree on it and then they must have a new contract drawn up). Most companies wont pay upfront for a account but they will pay as they mow the account (usually 2-4 cuts worth) so they can determine if the account is going to stay with them or leave (find another companie).

    Just in case someone wants to buy my accounts at three times the gross they are for sale, just bring me a check for $750,000 and their yours.
  8. HOMER

    HOMER LawnSite Gold Member
    Messages: 3,183

    Funny about transferring come the cell phone companies can do it so often. Cellular one just sold here to Unicell, wouldn't that make my contract with Cell One void? I should be abe to walk in and turn my phone in.........where's the difference I ask?:confused:

    I'd sell mine for 3x their amount today and give you one mower to cut them with.

    Come on down.
  9. sheppard

    sheppard LawnSite Senior Member
    Messages: 542

    The going figure here is 10% of the annulaized premium. E.G. If an account yeilds $1000.00 a year, the 'slae' price of the account is typically $100.00 bucks or rouphly 3 months of value

    LAWNS AND MOWER LawnSite Bronze Member
    Messages: 1,129

    I'm confused. By your math, Tallahassee must have 30 months in a year!!!


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