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Opportunity - Need Advice

Discussion in 'Commercial Snow Removal' started by M&M, Dec 23, 2009.

  1. M&M

    M&M Senior Member
    Messages: 312

    I have an opportunity to "buy" 15 driveway accounts from a very good friend in the area that I already plow in. I have someone who I will be able to sub them out to. The accounts will gross about $550 per event. What do you think is a fair deal for for me and my friend who I am buying them from? I'm thinking about 2x per push for each account that stays with me. Is that low? High? Of course I would make sure they sign with me before I pay for them. I just want it to be fair for both sides because we are good friends.
     
  2. Rickslawn

    Rickslawn Junior Member
    from midwest
    Messages: 20

    how much does your friend want for the accounts? I wish you luck doing business with friends and keeping the friendship intact. Its kinda like the business with family thing
     
  3. hydro_37

    hydro_37 PlowSite Veteran
    from iowa
    Messages: 3,790

    Why pay for something you can get for FREE??
    The accounts will be looking for someone to plow anyway
     
  4. parnellyj

    parnellyj Junior Member
    from MT
    Messages: 18

    I Have some Blue sky wanna buy it? Don't do it!!
     
  5. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    I had a company try and sell me about 15 lawn accounts this summer. I know the guy and h kept telling me they would be a good pickup, I kept telling him no, since I already service 25 accounts in this close knit sub division and I know I can pick them up. Well he started slacking on them since he was awarded a large contract and wanted to make a good impression on this condo complex. Within a month I had picked up 11 of them. I did not even go and talk to his clients. They called me or stopped me while I was out working and asked me to take over there yards. Dont buy accounts. Just take them if he is not going to service them. simple as that.
     
  6. mycirus

    mycirus Senior Member
    from Mass
    Messages: 589

    Dont buy clients. Earn them. I have gotten a lot by word of mouth and my great service. Advertise a little and you will be all set. You dont need to pay for them. If he cant do em, then fine, take em or let them find you. Youre throwing money away to buy them. Then what if they fire you? You paid for nothing.
     
  7. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,045

    I think the 2 times the /push rate is fair if they stay with you. Nothing wrong with paying for accounts if it's reasonable.
     
  8. snocrete

    snocrete Banned
    Messages: 2,862

    I agree on the fact that it can "sometimes" be a reasonable thing to do, I did it with 2 accounts the first year I did snow removal....still have the accounts, and they are 2 of the easiest going, fastest paying customers I have (1 commercial/1 resi)...........but I dont agree on the price. IMO, $500 after you receive the money from the first successful event would be more than fair.
     
  9. M&M

    M&M Senior Member
    Messages: 312

    Thanks for the input, Guys. I guess I probably should have told you that my friend hates plowing and has been wanting to get out of it for a while now. Well, his plow was stolen from a house he is building. He's not too sure if insurance will cover the loss. If it does not, he will not buy a new plow. I feel bad for the guy but also realize that it is still business and I need to look out for myself.
     
  10. Lugnut

    Lugnut Senior Member
    Messages: 250

    Theres nothing wrong with buying accounts, if you don't buy them someone else could, and they may come in and do just as good of a job as you. If you want to expand and the price is right, go for it.
     
  11. augerandblade

    augerandblade PlowSite.com Addict
    Messages: 1,054

    I know its business, but if he is a good friend, he would just open the books, tell ya what theyre worth , give you the contact numbers etc. and let ya go at it. You may have a lead on something in the future and do him the return favor of sending him business his way.
     
  12. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    Figure out how much it would of cost you to advertise to get the same amount of drives and give him the money instead.
     
  13. MIDTOWNPC

    MIDTOWNPC PlowSite Veteran
    Messages: 4,452

    Buy them. 2 times the rate is a great deal.
    Especially if he has done them for a few years.
    Id ask why he is selling them but as long as he doesnt say "they dont pay" I think your good.

    Also if more people call him he will refer them to you also.
    Make sure he shows you, or tells you any of the little things that certain ones may want when you are plowing. That way there is no noticable transition between him and you.
     
  14. buckwheat_la

    buckwheat_la 2000 Club Member
    Messages: 2,254

    why not "sub" to him for a year, that way you can ease into them, he well make money over the season to pay for them, and next year, he can just send a letter out to these accounts, "i am getting out of the plow buisness, but my sub wants to take over the accounts, and keep the service level the same as you enjoyed last year"
     
  15. wideout

    wideout Senior Member
    from iowa
    Messages: 727

    Buying snow removal accounts is stupid especially if he is wanting to give it up! Even if you buy them who's to say they will stay with you and an account may be his but it really isn't his to sell if that makes sense to you.
     
  16. Kubota 8540

    Kubota 8540 PlowSite.com Addict
    Messages: 1,952

    I bought a retiring snowplowers accounts, 2 trucks, 2 spreaders, about 20 years ago. Added those to my accounts and equipment. I was prepared to loose 25% of the customers on the list. He had been plowing for 20 years. He had accumulated more than 65 accounts. I had been plowing for 5 years and was lucky to have 20 accounts and couldn't gain anymore. I lost 3-4 customers off the list. I still have most of his original accounts even though owners have changed hands at some of the businesses and residences. Its can be risky, but it is possible to make it work out. I had him notify all the customers on the list that I would be servicing them for a certain date forward. He also put in a good word for me. If the price is right , do it! Even though it worked for me, hindsight would have the owner of the list agree in writing not to sell to someone else and that he would not plow again for X number years.
     
  17. M&M

    M&M Senior Member
    Messages: 312

    It's interesting to see hear both sides of the argument. We are going to have another conversation about this soon since we might get some snow Sat. night.

    We have passed work back and forth for years with no problems. Another idea is paying him in labor at the house he is building. And yes, I will have him call his accounts to inform them of the transition.