Purchasing another LCOs stuff and accounts

Discussion in 'General Industry Discussions' started by mad_wrestler, May 4, 2005.

  1. mad_wrestler

    mad_wrestler LawnSite Senior Member
    Messages: 339

    I got approached by another LCO in the area. He asked if I was looking to expand because he needs a quick sale. He is in the AF and is PCSing(Permanent Change of Station) on May 20th. He is what he hs.

    Exmark metro XP 48" floating deck w bagger, sulkie and mulch kit.(2 yrs old)
    Stihl BP blower BR340 Brand new
    Stihl Weed Eater FS55 1 year old
    5 X 10 utility trailer
    He also has 15 accounts. Ranging from 25-45 dollars.
    Asking $7000, I asked what his rock bottom was and he stated $5500 but any cash offer would be entertained.

    The accounts in my opinion are low. I don't do any lawns for less than 45.
    What would be a good offer price.

  2. A+ Lawncare

    A+ Lawncare LawnSite Senior Member
    Messages: 503

    IMO price looks high, unless there's many profitable accounts up for grabs, and will sign at least a 1yr contract....

    the Exmark is about $3,500 new... but with accessory its about $4,500-$4,700 new... 2 years old i'de say its worth about $3k for the mower w/accesories....

    Blower give him about a $75 less than what he paid for new....
    weedeater give him about $125 less than what he paid for...

    5x10 trailer you didn't give much details on it or year of it.... but u can buy this trailer for about $800-900 new.... so if its a few years i'de say anywhere from $500-700.
    a rule for the buyin accounts is for a turn-key business, it is usually 2.5x-3x the monthly revenue, but you must have an insurance of keeping the customer, a binded contract w/the customers for you to at least service their lawn for 1 year/season....

    from what you said He also has 15 accounts. Ranging from 25-45 dollars
    thats about $525 a week so thats $1,200 a month....

    IMO i'de offer 75% monthly and thats about $900 for those 15 lots....
    with all of this said, the following holds a value of $3k for the mower, $700 for all of those handhelds, $600 for the trailer, and $900 for those 15 accounts totals to be $5,200.....

    but IMO offer him $4,5000 cash
  3. bicmudpuppy

    bicmudpuppy LawnSite Silver Member
    Messages: 2,781

    What are the 15 accounts to YOU? and of that list of equipment, what do you need or can really use. The equipment only has value if you need it. This site is full of suggestions on what it costs to produce customers. Most say a figure less than $50 each. If he doesn't sell, those customers will find someone and it will cost that someone less than $50 in advertising to pick them up. If he has an actual full season contract that can be transfered for those accounts, then a percentage of those contracts could be considered. It sounds like the Exmark is the meat of this sale. What is that mower worth to you?
    I don't think the "buisness" without the equipment is worth a grand by itself.
  4. grassmanvt

    grassmanvt LawnSite Senior Member
    Messages: 906

    heres my .02 , as stated, the equipment has a decent value if you need it, otherwise, safe rule of thumb (obviously varies a lot) especially for the small stuff is half of new cost. Same might be said for the exmark, yes it may be worth more but sometimes what something is worth and what you can get are two different things so, if it isn't of much use to you, don't pay much. It sounds like you are in the drivers seat here. As far as accounts, sounds like you don't want them, so they are'nt worth much to you. Or, if they are well routed and you can knock em' out quick maybe they are worth something. Again, HE needs to get rid if something, sounds like YOU don't really care either way. I woud make a low offer and go from there. On a side note, I have purchased accounts in the past both summer and winter, worked out well for me but I took a calculated risk and it payed off. On the other hand, if the transition works out poorly, many customers could have been lost, only a couple were contracted but most stayed on anyway and were very satisfied. Good luck.
  5. Soupy

    Soupy LawnSite Gold Member
    Messages: 3,125

    15 accounts would cost me about $1,000 to obtain. The main thing is to look at them and see if they are worth anything. If they are priced low you might not want them for free. If they are well priced then they are worth a little more then your cost to obtain 15 customers because it is turn key and the work is done.

    The 15 accounts that cost me roughly $1,000 are priced by my standards. I guess I could obtain 100 accounts for $1,000 if I under price them all. See my point?

    This sounds to small to consider, unless your current operation could benefit from the mower. The handheld stuff and trailer are entry level at best. This might be a good buy for a person with nothing and wanting to get his feet wet.

    You mentioned charging $45+. That price and his price means nothing without knowing the variables. He might be doing 1/2 duplexes for $25-$45 and you might be doing acres.

    My minimum is $30 for up to about 8,000 sq. ft. depending on variables. But I do have a string of duplexes were I do each side for $20-25. Usually sell the first side for $25 and then pick up adjoining lots for $20. This actually brings me $45 for 6,000 sq ft but I have 2 customers instead of one (no billing on these). But if you focused on the $20-$25 price you might not realize the profit on the accounts.
  6. mad_wrestler

    mad_wrestler LawnSite Senior Member
    Messages: 339

    Wow, as always you all have great suggestions and advice. It will be determined if those accounts would be good or not. He is supposed to give me locations and breakdown today. The EXmark would be nice. I was really looking for a 36 however. Can those 48" metro get tilted through back gates of 36"? Thanks again.
  7. Todd's lawncare

    Todd's lawncare LawnSite Senior Member
    from P.A
    Messages: 548

    The accounts should be over 2000 i would think there every week cuts you didn't say but i bet ya you flash 4500 at him you have it
  8. BCSteel

    BCSteel LawnSite Senior Member
    Messages: 876

    Thats what I'd say too. Start counting out the C-notes and when you get to 35 kind of slow down like your pondering wether its worth it or not. 15 yards isnt exactly raking in the dough so 35 crisp $100 dollar bills would look mighty tempting. I dont know if I'd go over 4k though.

Share This Page