I know I have covered this before, that is, the question of whether you should by a Lawn Mowing franchise or not?
It is no secret that I am not in favour of buying a lawn and garden maintenance business whether it is an independent lawn mowing contractor’s business or a lawn mowing franchise.
But before I go any further I want to look at the pro-s and con-s of buying a business!
Reasons for buying a business:
- Established revenues or income streams
- Jobs in the locality or geographical area you want to focus on
- The sale price is too good to knock back, it might even be a freebie
- The business owner is motivated to sell quickly – so less expensive
- You can buy revenues without inheriting equipment, this makes you more competitive
- Due diligence shows it is a good acquisition
- No “growing pains” especially if you are only paying for revenues only without equipment
- Previous business owner stays on for settlement period
- You can manage the acquired growth properly
- Guaranteed income including franchise guarantees
Reasons for NOT buying:
- The asking price is too high
- You are not guaranteed customer loyalty, that is, the previous owner may poach some of your customers
- The job prices are locked in so you can’t put prices up
- Getting equipment that is an unknown
- You never know real reason for business sale
- You can grow organically with your ideas of how to brand and grow business
- You cannot retain the services of business owner for settlement/take-over period
Now, I want to ask the question again!
Would I buy a Lawn Mowing Franchise?
No, for all the reasons above, but also because of:
- Initial Franchise Fee of around $20,000 to $30,000
- Ongoing Franchise Fees of around $600-$900 per month
- Many of these franchisor organizations are primarily focused on selling franchises for the sake of selling franchises
- The franchisors are not focused on their primary customer which is the franchisee
- It appears the franchisees are the primary risk taker
- The franchise brand is easily tarnished by things or people out of your control
- Usually, the sale of a franchisee’s business must be approved by head office – so your exit strategy may not go your way
- The franchisors fund the initial period of 3-6 months with a “Work Availability Guarantee” – this guarantee is funded by your initial franchise fee – so really all the risks are borne by the franchisee. This guarantee is supposedly “a safety net” that is funded out of your own money
My Reasons for “going solo” include:
- Much better cash flow. If I were to purchase new equipment and vehicle on regular finance terms, then my cash flow would be a whole lot better providing I can get the new jobs.
- Getting the new jobs is not that difficult as I have shown in The “How To Build Your Own Successful Lawn and Garden Business In 30 Days” Blueprint. The money you save in ongoing franchise fees can be directed to targeting the sort of work you really want!
- Your money can be spent more efficiently
- You are not dictated to about where and when you can advertise
- If you want to exit the business, you can sell when you want to, and you can sell to who you want to!
- There is plenty of support to help you run your business. This support is available at places like http://www.YourLawnAndGarden.com/ . Also, there is support to be found in your local government run and funded business support agencies, for example, http://www.SydneyMetroBEC.com.au/ and the http://www.EnterpriseHub.com/ . Take a look at these organizations, and see how they can help provide support and direction for your business venture.
Have a look at our Profit making reports for excellent business support and marketing at:
- How To Prepare Winning Quotes For Your Lawn And Garden Business
- Ready-To-Use Templates of Real Quotes and Proposals for Residential, Commercial and Industrial Sites
- Starting A Profitable Lawn Mowing Business – From Scratch
- Understanding Your OHS System
- How To Win & Manage Commercial Landscape Maintenance Contracts
- The Contractor’s Guide To Weed & Feed Lawn Care
- How To Build Your Own Successful Lawn & Garden Business in 30 Days
- Successful Customer Service Tips For Contractors
- Ready-To-Use-Templates For Your Own Safety Policy
- The Ultimate Referral System For Contractors