Buying store front accounts?

I ran into a guy at the mall cleaning windows about 3 months ago, and stopped to talk for a few minutes. He said business was pretty good, and seemed happy to do little 15 minute jobs and make a few bucks. Fast forward and now he’s posting that he’s getting out of the business, and wants to sell his accounts. This kid did so many dumb things though, and I’m not sure how to take it over correctly? First of all he worked for another company and signed a “non-compete form”. His old boss has threatened to come after him since he’s obviously competing now (this is why he’s quitting). Secondly, he has nothing in writing with these mall stores. Just a handshake agreement that he will clean some weekly, and others bi-weekly. He keeps showing up, and they keep paying. His third mistake is making up a business name that’s not registered with the state of Florida, and having no insurance (not legit).

  1. I have this idea of both of us going to the stores together to explain how he’s leaving, and I would like to take over. What’s the right way to do that?

  2. We’re only talking 6 stores that only make $300/month so what’s a fair price to “buy” this from him?

Note: I am forming my LLC now (pending), and have insurance ready to go as soon as it’s approved.

Personally, I don’t think it’s worth a buyout. If I were you, i wouldn’t snatch the stores right out from under him, just cuz I try to be a nice guy. If you want those types of jobs, go market to the other stores, certificate of insurance in hand and use that as a selling point.

There’s another company near me that a former friend owned and was honestly bringing in more money than I was but their biz practices were terrible. As much as they frustrated me, I never downed them to a potential clients, I simply stressed my good practices and selled myself up.

As far as I know, they are now out of business with a line of lawsuits to follow and their clients are up for grabs.

Things like that always run their course.
Good luck with your new biz venture and welcome to the group!!

2 Likes

I wouldnt purchase them. Being very new (no offense) but you don’t even know if they are priced correctly. I wont just try to take them either. Looking for “easy” accounts to grow rarely works out. I’d hit the streets or invest in online marketing to grow. I think you would see a higher return.

2 Likes

I wouldn’t buy jack chit.

2 Likes

A fair price to buy this off him would be ZERO. You can get it yourself for free, keeping listening for a moment.

Rule number 1, this is for buying any business. Have them provide income statements for at least the past 5 years. If they cannot do that, its not worth it. This does two things. This verifies that they actually have a positive cash flow that is on the books, also it tells how long he has kept clients for. The other is, this also prevents you from investing in series of storefronts that may leave shortly after. It would be really bad if you invested money and were expecting a return and not only you do not get your return but you have to declare a loss on that investment.

The issue with the “non compete form” is between him and his former boss. It has nothing to do with you, he basically has no worth or leverage to get you to buy his routes. Actually, its the opposite. You now have all the leverage to take those stores and you can use him as fuel to build up your fire. Go and solicit to the stores you know he has since he is leaving.

If he is not going to be of use to them any longer and he cant get anyone to buy them, he will just leave with nothing. That would be when you go in and take all the stores. I had a similar experience where a window cleaner in a local town near my area left after not cleaning for 4 months, never returned calls and a few shop owners said he used the same excuse before that his back was injured (three times) and he had family issues (even more). Even if it is true, that person in my case was no longer helping storefronts solve their window cleaning problems. I took almost 10 stores in that single day, I have the whole town now.

When you pitch, remember use him as the leverage. If you just ask to clean, you may be met with resistance. You could tell the storefront owners this “Hi I’m Chris S. I just wanted to make myself known to you. Your current window cleaner said he is leaving the business and I would like to help out in any way I can. This is my card, if you have any questions, feel free to call and I will be happy to help.”

If they respond well to it, start with fact finding responses even if you already know the answers to the questions, you are getting them to realize the problem they are facing. Here are a few and you dont have to ask them all, but some of these will get you stores real quick.

“Do you know if your previous cleaner was licensed to do business?” “Did he have general liability in case something happened to your windows?” “How did he present himself? Did he have a uniform?” “Did he provide a paper or electronic invoice or receipts for tax purposes?” “How do you feel about how he cleaned for you? On a scale from 1 to 9, how would you rate him? What could “I” do to make that a 10?”

Once they establish their previous cleaner basically is not coming back and they turn to you for cleaning, do not underbid. There was a reason he was only getting 300/month for all these stores for weekly and biweekly cleanings, you could easily get more selling the service if the owners you pitch to are absolutely certain they need it. You may get haggled and feel like you need to keep the stores. They may say “Oh he was only 10 dollars a week, can you beat that?” you tell them outright “I understand, however that is why he is not in business anymore. We can service you all year for x amount (pitch more than what he was doing it for).”

Lastly when you get the stores, KEEP THEM. Build fun relationships with people, learn about their stories too. People you service also may want their homes done too. Sometimes when you clean commercially or corporate locations, you get people that wander up to you and say “Do you do residential?” or ask for your card.

Hopefully this helps you, I know Florida seems like a competitive state. Let me know if you have any other questions. I will be happy to help.

1 Like

Thank you all for the helpful feedback. My LLC was just approved, and now I’m working on stuff like logo, website, business cards, polo shirts, and trying to learn if I need to be licensed in FL.

What does he want for the accounts? One month’s worth of revenue, three months? I would have no problem paying something like that for them. I think a lot of storefront accounts are done on a handshake. If you don’t buy them someone else will and then you’ll wish you had spent a little money to make a little money.

Against the advice of some I ended up making a deal with that guy. I learned that he actually had a total of 9 store fronts that make $547 a month gross. I bought them for $980 in writing, and with a few conditions…

  1. He would personally go with me and introduce me as the guy taking over
  2. I would only pay for what’s in writing (Stores had to sign service agreements with my company)
  3. Since I’m so new he has to train me over the next month (1 day per week), and he won’t be paid any additional for his time training (part of the $980).
  4. If he fails to uphold his end of the deal I can put a lien on his car.

For a new guy like me just trying to get into the business it’s $980 well spend because now I can market to other people explaining how I already clean 9 other stores, get training, and not waste as much time/money in marketing.

Not bad, I still would have just took the stores and kept the extra $980 but whats done is done. At least you will turn a profit in 3 months. The conditions in writing helps. However, make sure the stores stay on with you. If there is a way to leave, they could also not pay you anything if the contract was not solid enough.

Congratulations on your victory.

1 Like