The Truth

Buying vs Starting your own

Analysing and Valuing a Round

Questions to Ask

Sales Contract etc

Truth: Purchasing A Lawn Mowing Round

Some groups within the industry are making BIG money from the selling of rounds.  Unfortunately, until now no-one has been willing to bring out the problems within the industry.  On many occasions there is to much money being made for honesty to come through.  You will very rarely see a lawn mowing contractor being in business for a year or more buying extra customers because he has learnt about the game and plays it very well.

Customer's are Free Why Buy Them? (The Valuation method used in this example is one of a few used in this industry depending on what state you are in, please see Analysing & Valuing A Round for further details).

If you were to purchase a round you would usually pay the amount per cut multiplied by 10 (which does not include machinery).  Therefore, if you were to buy a round consisting of 30 customers at a total price of $600 per cut you would pay around $6,000.  You would then have to mow the 30 lawns that you have purchase 12 times to brake - even (taking into consideration your expenses).  Therefore, you would have to work for 9 months without a cent of profit.

You then have the concern of losing customers as not everyone likes being sold.  Quite often customers do not like to be treated as an item to be sold and they don't want the new contractor.  Not to mention, you are not an expert and your cut might not be as good as the contractor before.  The chance is that you will lose around 30 to 40% when purchasing a round.  Out of the $6,000 you spent, you would have paid on around $1,800 to $2,400 for customers that aren't yours.

I achieved a client base of 40 customers in 3 months (which gave me around 60 cuts per month at an average of $20 per cut).  Other work consisting of one-off jobs, included rubbish removal, gutter cleaning, long grass slashing and weeding made up a balance of my monthly turnover.  I started slowly; this gave me the chance to get fit and helped me with on the job training

There is no need to buy customers, they are out there waiting for you.  You must realise that lawn mowing is a growth industry, the customers are free don't buy them.

Part Time And Cash Rounds

As stated in Analysing & Valuing A Round some businesses are sold with clients "on the side" or "cashies".  Due to the fact that this is illegal, it is extremely difficult for these clients to be incorporated into a contract of sale or for any legal document to be produced in support of the sale of these customers.  No money whatsoever should change hands for these clients, if the vendor (seller) chooses to give you these clients free of charge and they are not sold as part of the package, you must then put these customers on your books for legal reasons and they can then be sold at a later date as part of your business. 

Despite the fact that "cash rounds" are illegal many people operate businesses such as lawn mowing for extra cash income and do not declare it.  This is none of our business, however, they then, amazingly, try to sell this illegal operation and in doing so offer the buyer no guarantee whatsoever.  No contracts are signed, no records available.  This is regrettably a major problem within our industry.  What amazes me is not only do people purchase these high risk "businesses" but the sellers are asking prices equivalent to an established legitimate business.

If you would like any further information on purchasing rounds and the potential cons of doing so, please don't hesitate to contact Dean Bartorelli. 

Copyright © Independent Lawn Mowing Contractors Of Australia 2001-2008
Disclaimer - We will freely give advice  to all who visit this site, however we will not be legally responsible for any advice given.

sible for any advice given.