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Buying \"good will\"

Dan Wood
Dan Wood Member Posts: 1
in THE MAIN WALL
I am in the process of closing a deal to buy the customer list and phone number of an HVAC company in our town. It is good fit for our firm as far as business philosphy. Their rates are not as high as ours but they have always gotten top dollar for installations. They have a good reputation but have let the business dwindle the last year or two. They did not renew there add in the yellow pages that has just come out. But I think one year out of the book for a company that has been around since 1928 should be easy to recover the following year.

What I'd like to hear is if anyone has experience in this type of transaction and if you have any simple advice. We are drafting a simple contract that I will have my attorney reveiw and the other contractor said he would sell part time to his old customers as he phases into full time retirement

Thank You for your input,

Sincerley Dan Wood

Comments

  • hr
    hr Member Posts: 6,106
    Be careful buying \"goodwill\"

    and customer lists. Sometimes the most valuable part of a company is their yellow page spot if it was near the front.
    I wouldn't spend too much for his customer list. If he goes out of business guess where his customers will go! Good chance some of them will become your customers anyways.
    Also be careful not to buy his liabilities!
    Yes you would be wise to consult with an attorney versed in this type of transaction. I have been through this once and it is a lot more involved than a page or two of legaleze.

    hr

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  • John@Reliable
    John@Reliable Member Posts: 379


    Would advise to check into a business broker who really knows what you are buying, one firm that comes to mind is Gray,Gray,and Gray out of Boston they do alot of oil comp. also Bob Heddon? Assoc. out of Vermont also oil,they both are in trade mags. would be worth the price to know if worthwhile. Being out of the YP shouldn't be a big deal, have friend who is in 20 books for drain cleaning and skips every other year due to most people don't throw out books right away + they can't handle all the calls.
  • Andy_3
    Andy_3 Member Posts: 7
    Buying phone numbers

    I just went thru the same decision last year when a local Carrier dealer was trying to buy another Lennox dealer across town from myself. At first I thought I should be buying it because I sell Lennox products but after thinking about what they had to sell I did not think it was worth it. Not sure how much business my competor gets from the purchase but I know that many of the people now call us because they want a trained dealer to work on their products. And like someone else had said here we can't take all the calls we get now! Good luck
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