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Customer leads for sale..how much?

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  • Customer leads for sale..how much?

    I have been in business going on now almost 8 years and I am looking to sell off all of my customers as leads to a local competitor. Most of the customers have been around for 5+ years and are good solid customers.

    How can I figure out how much all of the leads are worth? Also how can I figure out how much each individual customer is worth?

  • #2
    I have been in business going on now almost 8 years and I am looking to sell off all of my customers as leads to a local competitor. Most of the customers have been around for 5+ years and are good solid customers.

    How can I figure out how much all of the leads are worth? Also how can I figure out how much each individual customer is worth?
    I would give you 30% to 35% of the gross for the year
    DJ Carroll
    EasyPro Property Services
    502-525-3279

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    • #3
      That is around what I was thinking too, but I have been asking other business leaders and owners, and they say anywhere from 1x to 3x your yearly gross. That just seems like a lot of money with no guarantee that the customer will stick around.

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      • #4
        That is around what I was thinking too, but I have been asking other business leaders and owners, and they say anywhere from 1x to 3x your yearly gross. That just seems like a lot of money with no guarantee that the customer will stick around.
        That is is for a business you are just selling customers . . .the basic formula is 3x a business' net profit
        DJ Carroll
        EasyPro Property Services
        502-525-3279

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        • #5
          I have been in business going on now almost 8 years and I am looking to see off all of my customers as leads to a local competitor. Most of the customers have been around for 5+ years and are good solid customers.
          This is interesting. Why are you selling them off as leads? Why not sell them off as customers? Have that new lawn care business owner work with you on the properties for a specific period of time and then introduce him to your customers. I bet most would stay.

          Is this what you are planning on doing or are you just looking to sell your customer list and have him take it from there?
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          • #6
            This is interesting. Why are you selling them off as leads? Why not sell them off as customers? Have that new lawn care business owner work with you on the properties for a specific period of time and then introduce him to your customers. I bet most would stay.

            Is this what you are planning on doing or are you just looking to sell your customer list and have him take it from there?
            Well, this is the situation. I have had a guy help me out here and there the last year with some of the accounts, subbing them out to him. But he doesn't do the quality of work that I expect, just the price. He is the only one with a flexible schedule and offers me a descent price.

            So I plan on using him again this year while I am finishing everything up and the contracts expire in December 2009 even though I can personally get out of the contract, the customer can not. I am in a sense just using the guy to finish up the year for I can spend time doing other stuff. But in the mean time, I do not want to give him the accounts and I know he can not afford buying them off from me. If I had an option, I would sell the accounts before the start of the season even began to a larger local competitor that I know has the money for the accounts.

            How you explain it though is that I can not really sell them as customers, because I can not sell the contracts or I should say "I won't sell the contracts" to him. I can only sell the possibility that they will stick around as customers to someone. There is no definite.

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            • #7
              Well, this is the situation. I have had a guy help me out here and there the last year with some of the accounts, subbing them out to him. But he doesn't do the quality of work that I expect, just the price. He is the only one with a flexible schedule and offers me a descent price.

              So I plan on using him again this year while I am finishing everything up and the contracts expire in December 2009 even though I can personally get out of the contract, the customer can not. I am in a sense just using the guy to finish up the year for I can spend time doing other stuff. But in the mean time, I do not want to give him the accounts and I know he can not afford buying them off from me. If I had an option, I would sell the accounts before the start of the season even began to a larger local competitor that I know has the money for the accounts.

              How you explain it though is that I can not really sell them as customers, because I can not sell the contracts or I should say "I won't sell the contracts" to him. I can only sell the possibility that they will stick around as customers to someone. There is no definite.
              Have you considered trying to advertise that you have your accounts for sale and see if anyone else can come in and buy them out right from you? What's your view on that, would that just be better to sell everything?
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              • #8
                Yeah I'm with Steve on this one, Find someone else to sell the accounts to. If you don't have the time to dedicate to you customers anymore you owe it to them to find a way to get their service to continue at the same or higher quality that YOU'VE been providing. Don't send a 2 bit shlep there just because he's cheap. That's crap. If his work isn't up to your standards then it isn't up to theirs either, but as far as their concerned he now works for you you & it's you doing the lousy job. Sell them off. To buy contracted accounts with a year to go I would sy you should be able to get a month or maybe 2 worth of gross from them. ($100/month account ... $100 sale price) That's a typical account sale. Think about it, How many months will he have to service that account to PROFIT his $100 back? Then he obviously want's to make some money on the deal right? So 1 months gross is fair. More than that & it's not really worth it to the buyer.

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                • #9
                  Chuck what suggestions would you have if a lawn care business owner wanted to sell his accounts and business?

                  Should he sell it as a package deal or separate it? Where should he advertise?
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                  • #10
                    Have you considered trying to advertise that you have your accounts for sale and see if anyone else can come in and buy them out right from you? What's your view on that, would that just be better to sell everything?

                    I thought about advertising the accounts, but then again I am kind of scared that some of the local competition then may try to screw me over, or that my customers may find out that I am trying to sell out and get really mad about the situation

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                    • #11
                      Yeah I'm with Steve on this one, Find someone else to sell the accounts to. If you don't have the time to dedicate to you customers anymore you owe it to them to find a way to get their service to continue at the same or higher quality that YOU'VE been providing. Don't send a 2 bit shlep there just because he's cheap. That's crap. If his work isn't up to your standards then it isn't up to theirs either, but as far as their concerned he now works for you you & it's you doing the lousy job. Sell them off. To buy contracted accounts with a year to go I would sy you should be able to get a month or maybe 2 worth of gross from them. ($100/month account ... $100 sale price) That's a typical account sale. Think about it, How many months will he have to service that account to PROFIT his $100 back? Then he obviously want's to make some money on the deal right? So 1 months gross is fair. More than that & it's not really worth it to the buyer.
                      Please dont misunderstand me in regards to the quality of the work. I should have better explained myself. The work is pretty great, not perfect. I don't think anyone could ever do the type of work that I expect. But what I am worried about in the quality is the personal attention, quick response time, and friendly service. He is just not "there" to that point yet.

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                      • #12
                        Keep us posted on what you decide to do.
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                        • #13
                          I will let you know what I decide. Put of me really wants to hang onto the customers and find a good solid sub. Its just hard to let go of customers that I have taken so much time and energy to build up. While the other part of me feels that its time to move on because the market is becoming completely saturated with fly by nights and new start ups, and with the economy absolutely tanking. A very hard decision to make

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                          • #14
                            Why not just sell it all outright if you want. Then take the money and look for new investment opportunities or hire someone full time to do the jobs maybe?
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                            • #15
                              Why not just sell it all outright if you want. Then take the money and look for new investment opportunities or hire someone full time to do the jobs maybe?
                              That is one of the things that I am considering. Whether to sell everything off, part of it, or just sub it out.

                              There are lots of pros and cons to everything, but trying to make the right decision. I think that what will help me make the right decision is whether I can get a good price for the customers if I was to sell them. If someone offers me a good price or accepts my offer, then I will probably bow out from the business totally.

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