Lawn Care Business Forum Lawn Care Business Book Lawn Care Business Blog Lawn Care Software
Home Forum Contract & Flyer Templates Blog Software Videos Podcast Calculators / Estimators Store Mower Review Design It Yourself Lawn Business School

Go Back   GopherHaul Landscaping & Lawn Care Business Marketing Forum > Business > General Business Discussions

General Business Discussions A place to talk about general business discussions.

Conctract Customers - Buying or Selling


General Business Discussions

A place to talk about general business discussions.
Reply
 
Thread Tools Search this Thread
  #1  
Old 03-20-2011, 12:41 AM
The Cleaning Doctor's Avatar
The Cleaning Doctor The Cleaning Doctor is offline
Senior Member
 
Join Date: Nov 2009
Location: Helena, MT
Posts: 927
Rep Power: 6
The Cleaning Doctor is on a distinguished road
Default Conctract Customers - Buying or Selling

Lately I have noticed a lot of questions about purchasing customers from another lawn care business and one question keeps coming up in every thread.

Quote:
How many of the customers will stay with you?
I have been thinking on this a lot lately and have come up with a possible solution. In most contracts you will find a clause (no not Santa) in there that gives them the right to sell your contract to another service provider. Mortgages are the biggest example of this. Car notes are another.

What if you were to put a clause in your contract that gives you the right to sell that contract for service to another company? Would this give you more value if you should decide to resell? Can you knock down the value if there is no clause in there and you are the potential buyer?

Without that clause the customers do not have to stick with you because the contract was between them and the former service provider not you.

You might also want a clause in there that will allow you to subcontract if the need should arise. Maybe your equipment broke and the job has to get done so you call a competitor and pay them to cut? It could be any number of reasons.

I would like to hear some other thoughts on this as I am curious.
__________________
Pat
Reply With Quote

Stop guess-timating. Learn how to estimate and make money! $$$
Mow Time Estimator Lawn Care Price Estimator Mulch and Topsoil Calculator Snow Plow Estimate Calculator


  #2  
Old 03-20-2011, 01:21 AM
Simpkins's Avatar
Simpkins Simpkins is offline
Senior Member
 
Join Date: Feb 2011
Location: Tri-State Area
Age: 34
Posts: 100
Rep Power: 5
Simpkins is on a distinguished road
Default

Lawn care business tipsLawn Care Business Book
Quote:
Originally Posted by The Cleaning Doctor View Post
Lately I have noticed a lot of questions about purchasing customers from another lawn care business and one question keeps coming up in every thread.



I have been thinking on this a lot lately and have come up with a possible solution. In most contracts you will find a clause (no not Santa) in there that gives them the right to sell your contract to another service provider. Mortgages are the biggest example of this. Car notes are another.

What if you were to put a clause in your contract that gives you the right to sell that contract for service to another company? Would this give you more value if you should decide to resell? Can you knock down the value if there is no clause in there and you are the potential buyer?

Without that clause the customers do not have to stick with you because the contract was between them and the former service provider not you.

You might also want a clause in there that will allow you to subcontract if the need should arise. Maybe your equipment broke and the job has to get done so you call a competitor and pay them to cut? It could be any number of reasons.

I would like to hear some other thoughts on this as I am curious.


I think this sounds like a great idea, personally! As far as knocking down the value if this clause doesn't exist, I'd say your hands are a little tied here. For example, if I were selling you customers and you beat me down to half what I was asking based on this fact, if a customer decided to go with another provider there is nothing you could do about it.

I think if you are purchasing customers and this clause doesn't exist, you can either choose to beat the price down because of it or take another route like was pointed out in some other threads (ie if a customer doesn't stay for xxx then you aren't paying for that customer). It would be a gamble going with the first option as you've already agreed to pay xx for him but if you can play on this and REALLY beat the price down, it could potentially be well worth it.

I would definitely start putting this clause in my contracts though.

Just my two cents. I'm interested to hear what others think too!
Reply With Quote
  #3  
Old 03-20-2011, 01:40 AM
The Cleaning Doctor's Avatar
The Cleaning Doctor The Cleaning Doctor is offline
Senior Member
 
Join Date: Nov 2009
Location: Helena, MT
Posts: 927
Rep Power: 6
The Cleaning Doctor is on a distinguished road
Default

Quote:
Originally Posted by Simpkins View Post
I think this sounds like a great idea, personally! As far as knocking down the value if this clause doesn't exist, I'd say your hands are a little tied here. For example, if I were selling you customers and you beat me down to half what I was asking based on this fact, if a customer decided to go with another provider there is nothing you could do about it.
You take a chance either way. How are you going to get your money back on that customer if they leave? do you thing the former owner will pay it? Some might but some will not. I personally would take the risk on a smaller investment.



Quote:
Originally Posted by Simpkins View Post
I would definitely start putting this clause in my contracts though.
I currently have a subcontract clause in mine because there are times that I do not have the time to do the writing and although I dabble in design, I am not great at it so I sub that work out.

That is just an example of how I do things. You might even consider sub contracting some pressure washing if you do not have the equipment. Better to make 10-20% than 0.
__________________
Pat
Reply With Quote
  #4  
Old 03-20-2011, 03:56 PM
Steve's Avatar
Steve Steve is offline
Administrator
 
Join Date: May 2003
Posts: 37,506
Rep Power: 10
Steve has disabled reputation
Default

The thing I wonder is this.

The service one lawn care business owner may provide to a customer can vary immensely compared to another.

So say if the original lawn care business owner really had a great hands on approach and the customers loved him.

He then sells to another company that is much larger and is only in it to mow, blow, and go.

To me, it seems that if the customer does not get that same level of care, they are going to look for another provider. How could a contract really help in such situations? I guess you could take customers to court that wanted to leave, but still? Would that be good for business?

What's your take on that?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Forum Jump

Similar Threads
Thread Thread Starter Forum Replies Last Post
Buying Customers LawnMedic Lawn Care Marketing & Post your marketing material for review! 13 02-25-2010 10:22 AM
Buying old vs. buying newer. rclandscaping Truck, Trailer, and Outdoor Power Equipment Discussion, Repairs. 5 08-27-2009 04:13 PM
Buying Customers jjones41 Lawn Maintenance / Lawn Renovation 3 03-31-2009 04:20 AM
Buying Residential Customers mowboy General Business Discussions 1 06-27-2008 09:44 PM
Advice on Buying Customers mowboy General Business Discussions 0 07-19-2005 01:04 AM

» Recent Threads
  RatingTitle, Username, & Date Last Post Replies Views
I came across this on a...
rootytalbot
Yesterday 11:04 AM
Yesterday 06:16 PM
by Chilehead
2 61
Help bidding a hedge...
hopolb33
Yesterday 06:09 PM
Yesterday 06:09 PM
by hopolb33
0 32
scag SWZT review!
mattthelawnguy
07-23-2015 02:28 PM
08-01-2015 11:27 AM
by mattthelawnguy
10 407
Big mowing job
Bradcook21
07-30-2015 03:57 PM
07-31-2015 01:16 PM
by Bradcook21
6 150
Say Hello !!!
Steve
03-19-2007 11:18 AM
07-31-2015 12:29 PM
by Steve
1,227 401,552
Hello Everybody
budspop
07-30-2015 11:42 AM
07-31-2015 12:28 PM
by Steve
1 66
Should I buy this Exmark...
googus
07-03-2015 09:22 AM
07-31-2015 11:34 AM
by googus
9 605
Hello!
brandycarlton
07-29-2015 12:31 PM
07-29-2015 03:54 PM
by Steve
1 141
Assessing the Market
NJDB60
07-27-2015 03:25 PM
07-28-2015 09:24 PM
by Steve
2 257
Whats wrong with this...
GreenWorx
07-28-2015 07:56 PM
07-28-2015 09:09 PM
by Steve
2 237
Funny craigslist post
GreenWorx
07-28-2015 07:17 PM
07-28-2015 09:02 PM
by Steve
2 251
Watch out for this -...
rootytalbot
07-22-2015 02:13 PM
07-28-2015 09:00 PM
by Steve
7 402
NewVenture
NJDB60
07-27-2015 03:38 PM
07-28-2015 08:58 PM
by Steve
1 231
Pricing issue
Mr. Mow
07-07-2015 06:15 AM
07-27-2015 06:40 PM
by GreenWorx
17 800
how to make customers...
Bradcook21
05-27-2015 05:04 PM
07-27-2015 06:08 PM
by GreenWorx
15 2,975
Need your help, Gopher...
Chilehead
07-23-2015 07:02 PM
07-27-2015 11:28 AM
by Steve
11 390
These are the days on...
ExtremeLawncareServices
01-11-2015 10:41 AM
07-27-2015 11:22 AM
by Steve
94 10,481
Dogs
Mr. Mow
06-29-2015 02:37 PM
07-25-2015 07:50 AM
by Chilehead
12 2,438
Just about mid year, how...
GreenWorx
06-24-2015 07:05 PM
07-22-2015 07:31 PM
by Chilehead
14 2,510
Learning as I grow -...
WarriorLandscapingCAN
07-18-2015 07:46 AM
07-21-2015 10:53 AM
by Steve
3 327
Large dirt mound removal
purdue1973
07-09-2015 07:45 PM
07-20-2015 12:55 PM
by Steve
6 471
Hey everyone
Fantasy landscaping
07-09-2015 06:53 AM
07-09-2015 11:47 AM
by Steve
1 342
Quickbooks Online
jscarolina
07-08-2015 07:54 AM
07-08-2015 12:55 PM
by Nate10928
1 366
I dont know what to do...
Bradcook21
06-21-2015 08:49 AM
07-07-2015 09:48 PM
by SGL1
16 2,768
Start LIKING FACEBOOK...
rlclawncare123
02-26-2015 12:06 AM
07-07-2015 02:54 PM
by GreenWorx
13 3,704
Is it too late to do...
markty
06-16-2015 05:28 PM
07-07-2015 01:00 PM
by problem solver
9 2,511
Hi everyone
Mattw
07-06-2015 05:59 PM
07-07-2015 10:18 AM
by Steve
1 364
4th of July parade...
Steve
07-06-2015 10:35 AM
07-06-2015 10:35 AM
by Steve
0 314
Unemployment rates drop,...
Steve
07-02-2015 12:40 PM
07-06-2015 10:30 AM
by Steve
4 488
» Popular Tags
ad landscaping advertising aerocore applying billy goat brushcutter blowout bob villa bush curb appeal services deliquentaccounts demonstration design door hangers employee problems equipment dealer equipment rental financials flyers foreman free advertising free lawn care growing a lawn care business hardscapes hiring how to husqvarna hydro increase customers invoicing landscape landscape services landscaping landscaping training lawn aeration lawn care lawn care busines plan lawn mowing marketing marketing secrets more customers business mr dave mulch new business ordinance patio install per hour charge pricing profit on employee quickbooks quickbooks online roundup scag secrets to landscaping shell shreaded small engine repair snow plowing solo solo backpack sprayer sq ft square foot swzt tree tree pics up sell employee web design website website design wood www.greenturion.co.za
Powered by vBadvanced CMPS v3.1.0

All times are GMT -5. The time now is 09:34 AM.


(C) 2011 Riggs Publications - Terms of use & Privacy Policy

All times are GMT -5. The time now is 09:34 AM.

(C) 2011 Riggs Publications - Terms of use & Privacy Policy