I might be buying anothers LCO... Need input.

Discussion in 'Starting a Lawn Care Business' started by Primetime-SRQ, Sep 21, 2007.

  1. Primetime-SRQ

    Primetime-SRQ LawnSite Member
    Messages: 88

    Hey guys,
    I was approached recently to purchase another LCO in my area.
    Here is the deal, they bought all of the equipment in January from a shop with that nice little 12month no interest--NO payment. And they are needing to move about 80 miles away for family medical reasons.

    Basically they are wanting me to buy the equipment for the original price they paid for the equipment and they will toss in 40 residental accounts they have for FREE. These accounts are small and only generate $100 bucks a month, but they are the small postage style lots. And they are claiming they have them in 2 clusters, and not to far apart from each other. And most of these they just gathered this year of course, hence the new equipment purchase.

    Here is the equipment listing.

    46" Exmark Zero Turn Lawn Mower 100hrs 19HP Kawi (2007 Model)
    Echo 2 Backpack blower
    Echo2 weed whips
    Echo 2 edgers
    Echo pole saw
    Echo chain saw
    Echo gas powered hedge trimmer

    14' single axel lawn trailer

    various hand toold,

    1995 F150, 6 cyld, stick, great gas mil.

    The truck, in which I don't need can be had for an extra $500.

    The have the loan due for payment(s) in January. And the loan payoff is $10,500.

    So, I'm thinking it is fairly a good deal, even though I don't really need any more equipment but it would be a luxury to have a backup of each plus a mower to go along with my 52" LazerHP.

    This would be my first time buying another LCO biz.. But this deal seems tastyif buy the equipment and the free accounts, and yes, I may lose 20% of them but still come out ahead.

    I was figuring since the equipment is used and depricated already that maybe I could squeeze them down to say $8k, plus the NO-Compete clause of course from him and his employee that he was working with him, if that is possible even..

    Any input would be great... Since I am meeting them this weekend to check everything out.

    And yes, I did post this on the other lawn site also for more input coverage... :drinkup:
  2. Runner

    Runner LawnSite Fanatic
    Messages: 13,497

    I'm sorry, but I don't see all that great of a deal, there. WHAT Echo equipment is it? Are they SRM 2400's or above, or are they the standard Home Depot 21's? Same with the blowers. The Echo pole saw...is it the extendable Power Pruner? Same goes with the edgers...(why 2 edgers - that is strange for an outfit this size). Also, the trailer is just a single axle. Bottom line, you COULD about go and buy all this stuff new for this amount. Essentially, you are buying $10,000 worth the equipment for 40 accounts that would take an entire year to pay for anyway. Don't be fooled by the "pay $100 a month" thing...because that is GROSS. If he was looking at a few thousand dollars less, it may be something to consider.
  3. All_Toro_4ME

    All_Toro_4ME LawnSite Bronze Member
    Messages: 1,578

    Are you say that all 40 accounts bring in $100/month or each? Did I read that right?
  4. Primetime-SRQ

    Primetime-SRQ LawnSite Member
    Messages: 88

    Yes--Each account brings in $100.00 Each... So it would be $4000 a month

    Well , and that is why I was trying to get them down a little on the price. I ddi not getting any of the model numbers for the Echos, but since he got everything from an Exmark dealer. I was hoping they wouldn't be the Home-Depot models... But I will find out more this weekend.

    JE LAWN CARE LawnSite Member
    Messages: 22

    I would probably do it, It will pay for itself within 6 months I know you got other bills to pay and stuff. I would just make sure the accounts are a sure thing first.
    And then I would get someone to help me.
    Good luck.
  6. All_Toro_4ME

    All_Toro_4ME LawnSite Bronze Member
    Messages: 1,578

    100 a month for each of the accounts? Wow. What are the yards going for each cut there in FL? I've read in other posts that some charge around 7.50 -15.00 per cut. Is this about right?
  7. Patriot Services

    Patriot Services LawnSite Fanatic
    Messages: 14,506

    100.00 a month for standard .20 to .25 acre homesites is about right for FL. You will get bigger accounts and some with extra services. A hundred a month is the bread and butter of residential down here, The trick is getting them close together, not too hard as the subdivisions are huge. You get a couple in one area and saturate it with hangers, flyer's and ads in the community papers. A property this size should take a solo no more than 18-20 minutes to do. A two man crew maybe 10. Good Luck!:usflag: :usflag: :usflag:
  8. Primetime-SRQ

    Primetime-SRQ LawnSite Member
    Messages: 88

    Yep.. I already have a few that are that size and it usuallt takes me about 15-16 minutes from the time the gate drops until I grab the truck keys..

    And these accounts are rather close together already, and I am sure there is some room for property improvement upsell items.

    SLCINC LawnSite Member
    Messages: 110

    Sounds like a pretty good deal. There is good value in the 40 accounts. If they bring in $4k a month, they can be worth good money. I purchased a smaller company last yr. and paid $13k for it. It came with trailer, 60" exmark w/1500 hrs, vacuum kit, 48" walk behind, and trimmers, edgers, blowers, along with about 50 residential accounts. I broke it down to the equipment to be worth about $8-$9k, therefore I paid $4-5k for the customers. If you can pay off all equipment in one season with his customers its a pretty good deal, especially if you arent working the crew. Just some of my thoughts
  10. Down2EarthLawns

    Down2EarthLawns LawnSite Member
    Messages: 191

    If you have the extra $, go for it. It will be a quick and easy way to expand and create that much more expansion room for you next season. Find a couple more guys during the off season and you will have 2 trucks running for the price of equipping one crew with NEW equipment. I would be all over it if rapid expansion is what you're after.

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