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Buying out another company

Discussion in 'Starting a Lawn Care Business' started by sootonurford, Jul 26, 2014.

  1. agent walker

    agent walker LawnSite Senior Member
    Messages: 477

    around here the accounts are worth approx 4-6wks of gross income. Id want to have a look at all the properties first and know his pricing on each one to make sure they are profitable and the type of clients you want.
  2. whiffyspark

    whiffyspark LawnSite Fanatic
    Messages: 6,506

    If it costs you 20k to land 75 customers you have other issues going on. With a 20k budget we could probably land 3x times that
    Posted via Mobile Device
  3. 205mx

    205mx LawnSite Silver Member
    Messages: 2,392

    We've purchased a few client lists. Works fine. Keep customer acquisition below $116/client and you do well.

    This means you won't always make a deal with a seller.
    Posted via Mobile Device
  4. TPendagast

    TPendagast LawnSite Fanatic
    Messages: 10,736

    so a company with a hundred active properties, you would pay $11,600?

    All these guys trying to sell these businesses want 30, 75, 200k.

    This is what Ive been saying.

    Selling a landscape company isn't worth a lot of money.
  5. 205mx

    205mx LawnSite Silver Member
    Messages: 2,392

    Don't lecture me TP. There's a difference in purchasing a company and purchasing a client list.
    Posted via Mobile Device
  6. Tn Turf

    Tn Turf LawnSite Senior Member
    Messages: 307

    There's one for sale in my area for $12k includes truck and equipment and contracts, but the owner wants to own 20% and get paid a percentage of profits. Not sure if that is ideal.
  7. dc33

    dc33 LawnSite Senior Member
    from Indiana
    Messages: 257

    theres a guy around here trying to get 60k for a list of 90 accounts that are NOT under contract

  8. Pietro

    Pietro LawnSite Senior Member
    Messages: 855

    In my opinion the accounts are worthless. They could drop you right after you buy him out. Even with a contract.....there is no way to guarantee client retention. Spend some money on nice full color fliers and advertise. You'll get clients no problem. He clearly wants out....and when no one buys his "company" he is going to throw in the towel.m then you can get his clients for nothing.
  9. dc33

    dc33 LawnSite Senior Member
    from Indiana
    Messages: 257


    in my case I said we could talk about a price IF he would agree to payments and those payments would be based on the retention rate at various points.
    If I have 80% of the account in 10 weeks, you get 80% of that payment, if 50% renew at the end of the year, you get 50% of that payment amount. He didn't like that.

    Me and a dozen other companies will pick up his accounts for free next year :D
  10. Tn Turf

    Tn Turf LawnSite Senior Member
    Messages: 307

    On the flip side, from his point of view, what if they are good clients but you're a bad or unprofessional business man and lose some of the good clients?

    Not saying you are personally, but that is a risk the seller has on his end of the spectrum.

    Food 4 thought

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