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View Full Version : Bought accounts this year.. think I'm getting screwed


greenscaper123
10-08-2012, 01:04 PM
This is my first year in business. In May, I paid $8k for 23 accounts that gross $3k a month for lawn cutting and $12k for spring/fall clean ups. He originally wanted $12k for everything so it seemed like a good deal at the time. Well, over the course of the next couple months 8 people quit. Now another person just quit cause I don't do snow plowing. He told me he would take care of the snow plowing the first year but he hasn't answered his phone for me or any of the customers the last 3 months. So I basically paid $8k for 14 accounts.

When we made this deal he ASSURED me nobody would quit. 9 quit so far. He ASSURED me that he would stay on with me the first year to answer phone calls and such. Never answers one. He ASSURED me that he would do the snow plowing the first year so that nobody would quit. Well now it appears he won't be doing that either so it looks like I'll probably lose even more. I've worked this entire year to pay off what I dished out and by the time next year comes around I'll probably only end up with 10 accounts. How badly am I getting screwed here and is there anything I can do about this?

LawnBoy0311
10-08-2012, 01:12 PM
Was anything is writing or was it all verbal? If it was all verbal, theres really nothing you could do.

Sprinkler Buddy
10-08-2012, 01:14 PM
Happens all the time. Buying accounts is just a bad idea. Try and build the business is all you can do. Tough lesson learned I'm sure.

LawnBoy0311
10-08-2012, 01:15 PM
Not too sure if this will help, but if it was verbal, send him a letter via certified mail. Outline everything he has not held up to and put a little note that you'd like to get it resolved or you'll be in talks with your lawyer.

Was there a non compete involved, or a clause saying he can't come back and take all his customers back??

greenscaper123
10-08-2012, 02:00 PM
Not too sure if this will help, but if it was verbal, send him a letter via certified mail. Outline everything he has not held up to and put a little note that you'd like to get it resolved or you'll be in talks with your lawyer.

Was there a non compete involved, or a clause saying he can't come back and take all his customers back??

We did write up a contract but nowhere in the contract does it state what happens if people quit. Same thing with the snow plowing. It doesn't state anywhere that he was to take care of the snow for the first season. Those two things were agreed to verbally. The guy went to school with my sister and lives around the block from me. He had this whole demeanor like yea I know your sister and we're practically neighbors, so I'm not gonna screw you over. He seemed like a trust worthy guy so I went with it. "How many people could possibly quit" I thought. The contract only states non competition and the said price for said number of accounts. It also states that he is relieved of all liability and insurance.

Here is what I agreed to in the contract, word for word:

"Party Two agrees to pay the estimated sum of $8,000 for 23 lawn accounts in said towns. It is the duty of greenscapes to maintain the proper customer service of the listed accounts in order to retain yearly contracts."

Well I did maintain the proper customer service. Everyone quit for reasons unrelated to my service. They either moved, couldn't afford it anymore, or some other reason out of my control. That's the part that I feel I may have some sort of case against him. Except, how do I actually prove before a court that the people who quit did so for other reasons, not having to do with poor service?

greenscaper123
10-08-2012, 02:04 PM
Happens all the time. Buying accounts is just a bad idea. Try and build the business is all you can do. Tough lesson learned I'm sure.

yup I'll never do this again thats for sure..

LawnBoy0311
10-08-2012, 05:23 PM
Doesnt look like anything you can hold him to. Customers can quit for any reason (contract or not). A contract only makes it harder for them to quit, but they still can. In the case your in, looks like your out 8K.

dpld
10-08-2012, 05:56 PM
i am sorry to hear it did not work out for you but from the sounds of it there might not be much you could do about it because you both had some of the agreement on paper but yet some other key area's of the agreement were not included in the written agreement and mostly agreed upon verbally.

i know a few people that bought existing businesses and it worked out well for them but i know dozens of guys that got screwed buying businesses almost the same exact way in what happened to you.

all you can really do from here is hope to retain all the people you can to get a further return on your investment and hopefully you can recoup all your money and some more for your troubles and chock it up for experience and avoid that from happening again.

mark123
10-08-2012, 09:50 PM
The guy doesn't own the customers so I have no idea how he thought he could sell them to you. Boggles the mind.

Grass Doctor
10-08-2012, 11:45 PM
We did write up a contract but nowhere in the contract does it state what happens if people quit. Same thing with the snow plowing. It doesn't state anywhere that he was to take care of the snow for the first season. Those two things were agreed to verbally. The guy went to school with my sister and lives around the block from me. He had this whole demeanor like yea I know your sister and we're practically neighbors, so I'm not gonna screw you over. He seemed like a trust worthy guy so I went with it. "How many people could possibly quit" I thought. The contract only states non competition and the said price for said number of accounts. It also states that he is relieved of all liability and insurance.

Here is what I agreed to in the contract, word for word:

"Party Two agrees to pay the estimated sum of $8,000 for 23 lawn accounts in said towns. It is the duty of greenscapes to maintain the proper customer service of the listed accounts in order to retain yearly contracts."

Well I did maintain the proper customer service. Everyone quit for reasons unrelated to my service. They either moved, couldn't afford it anymore, or some other reason out of my control. That's the part that I feel I may have some sort of case against him. Except, how do I actually prove before a court that the people who quit did so for other reasons, not having to do with poor service?

well brother you should rethink need to adjust to the situation if i dint have a truck ill rent one and if i dint have the money rent a plowing truck ill be shoveling snow,about start doing snow removal. to cesar what is from cesar.

Lawn Cop
10-09-2012, 07:52 AM
Yeah, Grass Doctor hit it right on the head.

Hedgemaster
10-09-2012, 09:11 AM
"Party Two agrees to pay the estimated sum of $8,000 for 23 lawn accounts..."


Seriously? "estimated sum"? Sounds like he could say you owe him MORE if he wants.

When I was 14 I sold a dirt bike with a note signed by the buyer ("sold as is") that was probably more legally binding than the example you posted.





Good luck. Learn and move on.
I guess I just live in an area where "buying accounts" isn't necessary because there are always people out there looking for a lawn guy.
Advertise.

Steve
10-09-2012, 10:47 AM
Sorry about all this happening.

How did all this go down? When you put your feelers out saying you were interested, did he take you out with him to meet the customers before you bought the customer list? Did he tell you how much he was charging each customer and did that price seem to be appropriate to you?

Did you get any equipment out of it?

LawnBoy0311
10-09-2012, 11:40 AM
easy there fella's! I'm sure he feels like cr@p after spending a hard earned 8K. Maybe we should try to keep the bashing comments to a minimum? Afterall, he was just trying to make a living. We've all made bad choices. I KNOW I HAVE!!!!

greenscaper123
10-09-2012, 01:03 PM
Sorry about all this happening.

How did all this go down? When you put your feelers out saying you were interested, did he take you out with him to meet the customers before you bought the customer list? Did he tell you how much he was charging each customer and did that price seem to be appropriate to you?

Did you get any equipment out of it?

well he posted an ad on craigslist and i contacted him about the accounts.. it turned out he was friends with my sister in HS and knew most of my sisters friends. no equip was included and he never introduced me to the customers. he just sent out a letter notifying them. he sent this letter out a month after me giving him the money. he did show me a contact list with all the prices and drove me around to see all the properties. most of the accounts were right next to each other too which was good. seemed like a good opportunity to add onto the 15 accounts that I had already gotten myself, putting me at about 40 accounts in my first year. plus my father was letting me use his truck, trailer and equip to help me get started so not too many start up expenses. i didn't mind droppin some money as long as they were good accounts. we both didn't really see the point in getting an attorney because we felt like it was simple really.. "you don't screw me over, I won't screw you over" i've worked for my father landscaping for about 14 years and i've never seen accounts quit unless you do a pretty bad job. so i was confident nobody was really going to quit. based on that, I guess i didn't really see the point in getting an attorney. even when i asked him "ok but what if some people do quit?" he replied "trust me nobody is going to quit as long as you do a good job" well, i did do a good job. while i know this is partly my fault, i'm just pissed off this guy can't keep his word as a man. he assured me and gave me his word nobody would quit. ultimately that's why i never went with an attorney because i decided to trust him and now he's just avoiding me like a plague. if it were 2-3 i wouldn't sweat it. but we are looking at nearly 10 now and almost half the accounts.

AkersLawn
10-09-2012, 01:16 PM
Gosh man I feel for ya. Thats a bad deal and hopefully you can at least not lose money, just time. When you own a business you get paid anything but an hourly wage. It is unfortunate he jerked you around, but at least now you know. Is there a reason you don't do snow removal/shoveling/plowing? Maybe it'd be worth looking into.
All you can do at this point is maintain a good relationship with the customers you still do have, and try not to ever lose your *** like taht again. Every user on here has gotten screwed before, and all of us probably will again. Im sweating hard on losing 950$ of work right now, and it sucks too, but the way i see it is there is nothing to do about it now, and at least its not out of my bank account, just time and expenses invested. Good luck with your business, keep working hard and advertising harder. Happens to the best of us man !!!!

greenscaper123
10-09-2012, 01:53 PM
Gosh man I feel for ya. Thats a bad deal and hopefully you can at least not lose money, just time. When you own a business you get paid anything but an hourly wage. It is unfortunate he jerked you around, but at least now you know. Is there a reason you don't do snow removal/shoveling/plowing? Maybe it'd be worth looking into.
All you can do at this point is maintain a good relationship with the customers you still do have, and try not to ever lose your *** like taht again. Every user on here has gotten screwed before, and all of us probably will again. Im sweating hard on losing 950$ of work right now, and it sucks too, but the way i see it is there is nothing to do about it now, and at least its not out of my bank account, just time and expenses invested. Good luck with your business, keep working hard and advertising harder. Happens to the best of us man !!!!

thanks man.. the reason why i didn't plan on plowing this season was because his plow accounts only really generate about $1k for an average winter. all driveways mainly. last winter we didn't even get anything. about 1 inch maybe. so after dumping all my cash on these accounts i didn't really want to sink more money into a plow and pay for the plow insurance until my second year in biz when i have more accounts. i was concerned about maybe losing some accounts to landscapers who do plow at the end of the season and that's when he said "alright, well you want me to take care of the driveways this winter until next season?" to which i replied yes. so i've been telling all these customers this summer that he would be doing it..cause that's what he told me... now everyone is upset because he is not answering his phone and guess who looks like the a hole.. ME.

Grass Doctor
10-09-2012, 08:24 PM
well he posted an ad on craigslist and i contacted him about the accounts.. it turned out he was friends with my sister in HS and knew most of my sisters friends. no equip was included and he never introduced me to the customers. he just sent out a letter notifying them. he sent this letter out a month after me giving him the money. he did show me a contact list with all the prices and drove me around to see all the properties. most of the accounts were right next to each other too which was good. seemed like a good opportunity to add onto the 15 accounts that I had already gotten myself, putting me at about 40 accounts in my first year. plus my father was letting me use his truck, trailer and equip to help me get started so not too many start up expenses. i didn't mind droppin some money as long as they were good accounts. we both didn't really see the point in getting an attorney because we felt like it was simple really.. "you don't screw me over, I won't screw you over" i've worked for my father landscaping for about 14 years and i've never seen accounts quit unless you do a pretty bad job. so i was confident nobody was really going to quit. based on that, I guess i didn't really see the point in getting an attorney. even when i asked him "ok but what if some people do quit?" he replied "trust me nobody is going to quit as long as you do a good job" well, i did do a good job. while i know this is partly my fault, i'm just pissed off this guy can't keep his word as a man. he assured me and gave me his word nobody would quit. ultimately that's why i never went with an attorney because i decided to trust him and now he's just avoiding me like a plague. if it were 2-3 i wouldn't sweat it. but we are looking at nearly 10 now and almost half the accounts.

here is my contribution buddy, keep in mind my English its not the best, here is what i think where ur problems start, u buy the accounts from this X guy.
he had his accounts set the way he had them, people was use to his services, snow plowing, free weed removal i dont know . u shouldn't came and want to change the way they were already set up, like you said i guy drop u cause u don't do snow plowing, here is where u start looking for troubles, there is an old saying that says, dont fix if is not broken that's were u got it all wrong, u should go back, to all this people and start giving **** away like free soil aeration, if the sign up for a new contract tell them that you are interested in provide them with a high quality services at very affordable prices, now its a good time to aerate, or what can i do to regain your services,

Steve
10-10-2012, 07:58 AM
From this point onward can you push forwards and continue your marketing? I think next year will be a better year and you are going to find more customers.

AkersLawn
10-10-2012, 10:21 AM
thanks man.. the reason why i didn't plan on plowing this season was because his plow accounts only really generate about $1k for an average winter. all driveways mainly. last winter we didn't even get anything. about 1 inch maybe. so after dumping all my cash on these accounts i didn't really want to sink more money into a plow and pay for the plow insurance until my second year in biz when i have more accounts. i was concerned about maybe losing some accounts to landscapers who do plow at the end of the season and that's when he said "alright, well you want me to take care of the driveways this winter until next season?" to which i replied yes. so i've been telling all these customers this summer that he would be doing it..cause that's what he told me... now everyone is upset because he is not answering his phone and guess who looks like the a hole.. ME.

Ya ive had similar experiences. If you arent in an area to do snow removal, honestly I dont know how you could do it. Ive found that this winter I'll make about 5 times what I did this summer. Im sure everyone gets by, but its hard to sell snow plowing when you have no snow..
Keep your chin up and go get some accounts that are worth while. Don't lowball, don't give your services away for free, and don't kiss A** just to kiss it. You are a businessman, with a business, not an employee with a job.
All you can do at this point is do your best to keep the clientelle that you do have, and market hard for more. Maybe try to find a high school kid or something that will be willing to do the work, and even if you hardly make anything, you do none of the work and more importantly, keep the clients. This is by no means an easy business and we're all learning here. If i had a dollar for every time ive been screwed over, I'd at least be able to buy a fifth of crown and cope with it. If all else fails get a job over the winter to at least keep the cash flow going and hit it strong and early next spring. Sounds like you are becoming more and more equipped to handle a bigger load, get some employees and just keep taking it seriously, It'll pay off in the end. I mean ... this is America right??

TiedemanLLC
10-10-2012, 04:41 PM
I feel for you too. I have been on both ends of almost being bought out, and trying to buy someone out too. In the end, with two different situations I walked away from the deal, it was the best decision that I ever made.

In regards to the buy out, I had it setup differently when I was trying to buy the other person out. Everything was in writing, non-compete, I was buying not only accounts, but supplies and equipment.

The buy out was going to happen over a three year phase. More or less, if I lost any clients then the next years payment would be adjusted accordingly. He would stay on as a part time manager to help with the transition, and at the end of the three years, if he actually got me more clients, then he would receive a percentage bonus (this was a little incentive so he wouldn't screw me over but actually work with me). In the end I canceled the deal because he wanted all of the money up front. I declined.

In another instance when I was going to get bought up, I was made promises and promises (this was when I first started in the business so I was a little wet behind the ears). I agreed to a buy out price that included the equipment, my accounts, and me being a manager of the company that just sat behind a desk all day.

However, after three days of no money, not being promised the qualified help, and having to work out in the field, I packed up and left.

Grass Doctor
10-14-2012, 10:56 AM
this is America right??

<iframe width="420" height="315" src="http://www.youtube.com/embed/xFVdvXGIT34" frameborder="0" allowfullscreen></iframe>

LawnBoy0311
02-26-2013, 08:18 AM
Greenscape, what ever happened? How did your first year go? of those customers, how many in the end stayed?

greenscaper123
02-27-2013, 03:03 PM
Greenscape, what ever happened? How did your first year go? of those customers, how many in the end stayed?

Out of the 23 I bought, 14 stayed. It could have been worse I guess, just wish I hadn't spent so much money for them. A couple weeks ago I saw a guy on craigslist selling 54 accounts under CONTRACT for $7000. That's a $1000 less than what I paid for essentially 14 haha. I'm looking past it though, it's a new season and most of the customers who stayed on are agreeing to monthly maintenance packages and pre pay billing. I realized my depression over it last year really hindered my drive and focus to succeed. So I'm making a big push with my postcards this year and expect to be around 70 by April. Regardless of whatever money I wasted last year, if I can be in that position in my second year, I'll be happy. Wish me luck!

LawnBoy0311
02-27-2013, 03:51 PM
Out of the 23 I bought, 14 stayed. It could have been worse I guess, just wish I hadn't spent so much money for them. A couple weeks ago I saw a guy on craigslist selling 54 accounts under CONTRACT for $7000. That's a $1000 less than what I paid for essentially 14 haha. I'm looking past it though, it's a new season and most of the customers who stayed on are agreeing to monthly maintenance packages and pre pay billing. I realized my depression over it last year really hindered my drive and focus to succeed. So I'm making a big push with my postcards this year and expect to be around 70 by April. Regardless of whatever money I wasted last year, if I can be in that position in my second year, I'll be happy. Wish me luck!

Wow, thats still not too bad. You'll do great this year and making them full service is even better! Good luck to you!

jymie
02-27-2013, 04:02 PM
Out of the 23 I bought, 14 stayed. It could have been worse I guess, just wish I hadn't spent so much money for them. A couple weeks ago I saw a guy on craigslist selling 54 accounts under CONTRACT for $7000. That's a $1000 less than what I paid for essentially 14 haha. I'm looking past it though, it's a new season and most of the customers who stayed on are agreeing to monthly maintenance packages and pre pay billing. I realized my depression over it last year really hindered my drive and focus to succeed. So I'm making a big push with my postcards this year and expect to be around 70 by April. Regardless of whatever money I wasted last year, if I can be in that position in my second year, I'll be happy. Wish me luck!

Best of luck. Do you have a website?

Steve
02-28-2013, 01:04 PM
Out of the 23 I bought, 14 stayed. It could have been worse I guess, just wish I hadn't spent so much money for them.

Looking back at the situation now, what range do you feel would have been a good price to pay? What multiple of their weekly mowing price would you pay for a customer in the future?

I realized my depression over it last year really hindered my drive and focus to succeed

Every once in a while on here we talk about depression and how it effects are abilities to do what we want to do. Can you tell us a little about your thought on how depression factored into this business transaction and how it effected you afterwards?

greenscaper123
03-05-2013, 04:55 PM
Looking back at the situation now, what range do you feel would have been a good price to pay? What multiple of their weekly mowing price would you pay for a customer in the future?


Every once in a while on here we talk about depression and how it effects are abilities to do what we want to do. Can you tell us a little about your thought on how depression factored into this business transaction and how it effected you afterwards?

Well based on the customers that actually stayed on, which was 14, looking back I would have never paid more than 3000.

When I started the season I had so much fire. I had all these thoughts and ideas on where to go with this business and I just couldn't wait to get started. Then when people started quitting, it was like every bit of ambition I had in me was sucked out. I was skeptical dropping that much cash as it already was. I stopped advertising and basically became content with what I had. I was only working 20 hours a week and yet when I was done with what I had to do, I wouldn't even attempt to find more work. Instead I would go home and feel sorry for myself. "If I would have done this, if I would have done that" I would spend hours online trying to figure out if there was a way I could recoup my money. I would call lawyers, I would go on forums like these and ask people what I should do. Looking back, I realized what I should have been doing was going out and finding more work, calling up all my existing customers and try to up sell, network with people, create a website, work on things to improve my overall image as a business. Instead I didn't do any of that. Instead I came on here and complained about it and spent hours trying to figure out how to correct the past.

I eventually realized that if I was ever going to continue growing I needed to put it behind me and start focusing on a fresh start. It's literally impossible to focus on the future when you're stuck in the past. The past brings about nothing but depression when you dwell on poor decisions, because it's over and done with. The future on the other hand instills opportunity, which in turn creates optimism. I think that's why my ambition has finally returned.

greenscaper123
03-05-2013, 04:55 PM
Best of luck. Do you have a website?

I'm working on one now actually

jymie
03-05-2013, 06:30 PM
Check out my site click on the banner below maybe you will get some ideas. I have one page as a request a quote page, that has been golden for me. At the bottom of that page you can click on the link to the host for it, it is free to use for up to 5 forms. I use it for job applications, quote request page, referral form and satisfaction survey.

Heres the link for it: http://www.emailmeform.com/

Its very simple to use, after you create your form, you get html code and insert the code onto your site page.

Steve
03-06-2013, 10:52 AM
I have one page as a request a quote page, that has been golden for me.

It seems so often that new customers are impatient. If they call and don't get their call answered, they tend to move on to another company to call. With that in mind, how do you explain a quote page working so well? Do you think potential customers are more able to wait for a response when they fill one out or maybe they fill them out on off hours and don't expect to talk to someone at such times?

SNethercutt
03-17-2013, 08:24 AM
Well he took you to the cleaners. One thing I would do if I was you, always have a lawyer write up all of your contracts to protect you 100%. A lawyer can include things in the contract that me and you wouldn't understand but would bind the seller to certain obligations in this event. Next time you might want to pay it out over 6 months to ensure said customers remain with you and if they don't you renogotiate on price. And it says you will do everything to ensure customer satisfaction....that includes snow removal. Lol.

I now for a big time lawyer, I trade my services with her to read and ensure accountability of all of my contract applied to certain situations.

Steve
03-18-2013, 11:57 AM
I now for a big time lawyer, I trade my services with her to read and ensure accountability of all of my contract applied to certain situations.

Are there any specific circumstances where she helped you with something you didn't realize could be a potential problem?

SNethercutt
03-18-2013, 07:52 PM
One that comes to mind here recently is I had a contract I wrote out, it said that all complaints must be emailed to (insert email here) and that you couldn't drop us without filing a formal complaint.

Customers will give NMC 15 days to correct problem.

Problems must be document to terminate contract without penalties.

She pointed out to me that anybody can email me and say this or that and complain. Instead it stated that dropping for problems with services outlined in Scope of Work will be sent certified mail to me. We have 15 days to correct the problems and investigate the issue and come to agreement with customer.customer may terminate contract with nmc after two formal complaints have been filed.

Something along those lines.

SNethercutt
03-18-2013, 07:58 PM
She helps me out, but mostly I reuse the same contract just change things where needed, depending on what's being done.

Steve
03-19-2013, 10:43 AM
Well those seem to be very useful tips! I am glad you have her as a resource like that.

rockymtnnut
03-21-2013, 08:59 AM
This is my first year in business. In May, I paid $8k for 23 accounts that gross $3k a month for lawn cutting and $12k for spring/fall clean ups. He originally wanted $12k for everything so it seemed like a good deal at the time. Well, over the course of the next couple months 8 people quit. Now another person just quit cause I don't do snow plowing. He told me he would take care of the snow plowing the first year but he hasn't answered his phone for me or any of the customers the last 3 months. So I basically paid $8k for 14 accounts.

When we made this deal he ASSURED me nobody would quit. 9 quit so far. He ASSURED me that he would stay on with me the first year to answer phone calls and such. Never answers one. He ASSURED me that he would do the snow plowing the first year so that nobody would quit. Well now it appears he won't be doing that either so it looks like I'll probably lose even more. I've worked this entire year to pay off what I dished out and by the time next year comes around I'll probably only end up with 10 accounts. How badly am I getting screwed here and is there anything I can do about this?

now it's time for damage control take your time in your energy going to the 10 you still have talk to him make sure they're still happy and saturated your business with those 10 accounts your next door neighbors everybody on your street should have some type of proposals from you. unfortunately he has no integrity unfortunately there isn't much you can do about it. In this business is like a leaking boat you never stop bailing and doing damage control. make it a point to never do this again and never do this to someone else. there will be a time when you see him and what you do to him is up to you.