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client lists for sale....

Discussion in 'Business Fundamentals' started by sledneck24x, Feb 24, 2012.

  1. sledneck24x

    sledneck24x Senior Member
    Messages: 107

    I always kind of wondered how others feel about buying client lists or buying another companys plow routes. I see them all the time on craigslist usually not for my area, but recently one went up for sale in my neck of the woods but I personally feel alittle nervous about buying someone elses accounts.
    Thanks For you advice and expertise in advance.
  2. Rc2505

    Rc2505 PlowSite.com Addict
    Messages: 1,245

    They are only worth money, if the client signs your contract. Otherwise your just paying for a list of names that mean nothing.
  3. sledneck24x

    sledneck24x Senior Member
    Messages: 107

    Thats how I have always looked at them. Its wierd that so many snow plow routes go up for sale I wonder how many people that have purchased the plow routes dont come out ahead.

    NICHOLS LANDSCA PlowSite Veteran
    Messages: 4,286

    Never thought it was a good business decision. You don't know what you're getting, I guess if you're getting signed contracts it would be worth something but you have to go off his numbers and you are already starting out behind on the profit. I guess I'd do it if it were a minimal amount, if I had to plow each account once for free it might be worth it
  5. 4wydnr

    4wydnr Senior Member
    from N. IL
    Messages: 151

    To me it seems like it would only be worth a percentage of what you actually make off of it. Unless it was dirt cheap there is no way I could see paying a flat rate for a list.
  6. sledneck24x

    sledneck24x Senior Member
    Messages: 107

    Yeah alot of the times I cant see making money on some of those client lists. and could be quite sketchy I would assume because you never know if he could be BSing you. I havent called the guy yet but I was just going to call and see how much to see if he is crazy or not. I have seen it where guys want 80% of what they make in one year.
  7. cmo18

    cmo18 Senior Member
    Messages: 814

    I had an opportunity to purchase a 50 account mowing list last year. I looked at all the properties and figured out what I would charge. Then looked at the signed contracts and I found out why he was selling!! he was making no money, and wanted 30% of the contract values.

    Very risky, especially if the previous company offered terrible service and the chance of the client signing back up is minimal.
  8. sledneck24x

    sledneck24x Senior Member
    Messages: 107

    I think that in the end there is just way too many variables and The risk of not making money and losing money is just not worth it.
  9. 4wydnr

    4wydnr Senior Member
    from N. IL
    Messages: 151

    I would sign a confidentialilty agreement to look at his records. If they look good then maybe you can work out a deal for say 50% of profits for the first year or something along those lines.

    I think a fair deal is when you pay for what you are actually getting, maybe he will see it that way too?
  10. Chineau

    Chineau Senior Member
    Messages: 446

    Has to be a away.

    So think about it you build a following of customers by delivering good service there has to be away to get value out of your effort when you want to get out of business. This is a something to figure out otherwise at some point all you have is a bunch of not so gently used equipment for sale.tymusic
  11. dubya

    dubya Junior Member
    from NY
    Messages: 23

    I've given this some thought too. If I was to sell my list of residential customers I'd ask $75-$100 per name. I have 50 customers all within a 3 mile radius so its very concentrated. My customers don't really care who plows them as long as they are reliable. If I informed my customers that I sold the business and recommended him to them, I'm sure they would all give him a shot, but it would be up to him to perform. You can start up your own list and take 3-5 years to where I am with them all concentrated in an area, or pay me $3500-5000 and start off with 50 customers the first year. I don't see it as a big deal for customers to give the new guy a shot-at least one time. Just give them timely service and don't tear anything up.
  12. snoworks07

    snoworks07 Member
    Messages: 34

    It could work if all variables were right. But in my opinion, all you have to do is do a little leg work to get what they already have.
  13. RLM

    RLM PlowSite.com Addict
    Messages: 1,270

    As others have pointed out there are alot of different ideas 9pm this. Part of it depends on the market, client type, etc. In my view a tight residential list has more value than a loose list of commercial properties. As others have pointed out you are basically buy the "leg work", if you are willing to put time & money (cost) into developing a good client base, or it may be less expensive to pay someone who has already done this for you. It is a judgement call, just like buying a frachise, anyone can open a sub shop...buy a subway frachise your buying a "system", but there is a cost associated with that franchise, it is up to you to determine if the cost is worth it to you. In my opinion it is part of the problem with our society, nobody wants to take the time to develop their "own" business, so we end up with a butt load of franchises, box stores, etc. as posed to a bunch if mom & pop type places, where staff cares about customers, quality, etc.
  14. sledneck24x

    sledneck24x Senior Member
    Messages: 107

    the big problem with the guy that was selling his client list he was not reasonable. He wanted $15000 for a list of less than 50 residential accounts and spread between a 25 mile radius. He could not give me a reason why he wanted what he wanted. So I told him what I though they were worth and he threw a fit. I am open to a purchasing a client list, but am not willing to pay more than they are worth.