If you bought a business, would you

[Jamesh921]

If you were to purchase another carpet cleaning business that was located in another town, and their reputation was adequate, would you change the name to YOUR company name or would you continue to operate it under the existing company's name?

Why or why not?

Thanks

 

[Bjorn]

why would you want to change it

 

[Gary Taylor]

leave the name that's what you are buying. If you feel you need to change, do it over time.

 

[Jamesh921]

why would you want to change it

That's the whole point of this discussion. If the company has an adequate (or good) reputation, why or why not, would you change it?

Would you change it just because you're proud of your current company and want to emulate that reputation? Would it be for "pride" in your current company name? Do you think you would lose customers from the purchased company if you changed the name? etc.....

Or, would you think YOUR company name would carry over into another market and you would actually GAIN market share, even though most of those clients have never heard of you?

This is what I'm saying, "What are your thoughts about pros and cons of changing the company name"?

Thanks

 

[joe harper]

why would you want to change it

That's the whole point of this discussion. If the company has an adequate (or good) reputation, why or why not, would you change it?

Would you change it just because you're proud of your current company and want to emulate that reputation? Would it be for "pride" in your current company name? Do you think you would lose customers from the purchased company if you changed the name? etc.....

Or, would you think YOUR company name would carry over into another market and you would actually GAIN market share, even though most of those clients have never heard of you?

This is what I'm saying, "What are your thoughts about pros and cons of changing the company name"?

Thanks

James,

I have purchased several companies over the years...
If you are a Corporation..? Run the new company as a "Division of your corporation"...
Do this for 2 to 3 years..."Eventually converting to your present corporation.."

Have the checks made out to your current corporation...!
This will save..lots of accounting & insurance issues..."idea"....!

If you are ..NOT.. a corporation...?...Do a "DBA".....!!!!

KEEP IT SIMPLE....!!!!!

ps...You basically treat this NEW company as a franchise....! Strip all assets over a
short period of time...and create the image of a MUCH LARGER...mother ship...!!!

 

[Brian R]

What Harper said.

But really...take your time...I've had customers come looking for my old company names after 7 or 8 years. :shock:
Back when I was called "Just Carpet Cleaning"

 

[joe harper]

What Harper said.

But really...take your time...I've had customers come looking for my old company names after 7 or 8 years. :shock:
Back when I was called "Just Carpet Cleaning"

The ...KEY...is to have the initial check written to the "EXISTING CORPORATION"....!
If the service is GOOD....they will search their checkbook or CC statement...when they
need RE-SERVICE................! "Two chances to get the client back"...Either by payment
record ....or....name recognition of purchased company...!

 

[steve frasier]

I would do what Harper says

locally

GI Joe's went to Joe's and went out of business

I do work for Charlie's Tire Factory but a guy named Gary bought it. He didn't change the name but checks are written to his other automotive business, he never even considered changing the name

K&M Care Car bought Total Car Care and changed the name, business has been down ever since

 

[rick imby]

I cannot think you would want to keep two identities. Different identities would be a pain to maintain. Multiple trucks with different logos.

Unless you wanted to expand the name you just bought into your own city and expand your name into the other city. Then you would have two competing franchises in the same markets. A pain but with some paybacks. You would have two points of contact in both markets. Advertising two companies is about 1.5 times as expensive (I know this from experience).

Are you buying the company or just their customer list and their assets? I guess I am asking if you are paying much blue sky for the business. How good is their marketing? How good is yours?

You could get two websites in the top of both your markets. Two points of contact. Two sets of advertising in both markets.

One answering service, two different franchises. One management, two companies. One service department two companies.

One company does all the commercial and both fight it out for residential.

Sounds like a challenge to me.

If you have a split personality it might work well.


Harper,
You have bought a lot of companies through the years. Can you give us a range of how much you would pay for a company?

One Truck, $100,000 per year, 10 year old business? Owner retiring?

Rick

 

[Brian R]

Two different identities is not a bad thing. You can use one for high end work and the other to catch the market just below it.
I know people who have started another name just to grab more of the market share.

Do you know how many companies Coke owns? Their not all called Coke.

I know, I know...this is different but the but the reasons still apply.

It is a pain running two different names in two different markets...I've done it. But I think if done correctly, you can dominate your area.

So unless the reason is to market to 2 different demographics IE: homeowners or renters or pro managers or commercial etc....THEN bring it into one name.

If you want to sell to every category....2 names is not a bad idea.

 

[joe harper]

Rick,

Most of the companies that are for sale are in the biz from 3 to 5 years...!
Most of these companies can be bought for VERY little...10% or less of gross sales.

I never buy the equipment...It is usually "UNDERPOWERED"....for our use...!
Many reasons for the sale's..."Divorce, Moving, Health, Lack of capital to make a profit..."


As for the 100K..10 year Biz.....?

Very seldom is this the case...This business is NOT on the market very often...!
The "retiring"..Owner will want TOO MUCH money for the purchase...!

This type of "SALE"...is best negotiated with the owner to receive 30% of the gross sales
and just sub the work to MY company..."AS A PERPETUAL RETIREMENT"....!

PS..One year I bought out 3 of my competitors..CARPET PRO...NOVA...&...RAINBOW...!
They all had "Yellow Page Ads"..is my local area...!!!! For the NEXT 3 years....I OWNED
4 of the 7 companies in my area...!!! "After the customer had called 3 different companies"
And always got ME on the phone....They just GIVE-UP...!!! and book the job...!

 

[Brian R]

So you couldn't close the deal the first 3 times huh Harp. Tisk tisk. shiteatinggrin

I'll fly down and give you some pointers on phone skills. !gotcha! :mrgreen:

 

[joe harper]

So you couldn't close the deal the first 3 times huh Harp. Tisk tisk. shiteatinggrin

I'll fly down and give you some pointers on phone skills. !gotcha! :mrgreen:

NO marY...!

Whether you want to ADMITT it or NOT....Customers will price shop "AFTER" booking
with another company...!!!!

"YOU COULD NOT CLOSE A SCREEN DOOR ON A SubMaRinE..."

UNLIKE...your B&S..viRtUaL company..."sad"

I purchased for "MARKET SHARE"......
"I actually UNDERSTAND....that it TAKES money to make MONEY..!!!!"

By having a MonOpoLY....We were able to CONVERT...low-end clients into HIGH-END clients..!

"That takes something that you don't have.................."TALENT"....!"

You think getting your FOOT into the door ....is closing a client...."embarrassed"

 

[Brian R]

Back peddle all you want...but you just said you suck on the phone. What?...can't use smiley's over the phone to get yer point across?? :mrgreen:

 

[floorguy]

The 1 i bought wasnt very far away...but it wasnt huge either, and we never had crossed paths before....

with that said i just changed it to my name, and told the custys i had bought it out...

heres the kicker, he had just bought it from another guy 2.5 yrs earlier...sooooo some of the custys were i bit irked....UNTIL....

i DID A BETTER JOB THEN EITHER OF THEM...then they have/are happy as pie...

I probably over paid, but with the little bit of work on it, it will pay its self off in less then 1.5 years, for what i am avg per month...

but i got a bigger machine, and some other tools, and a new base of clients to work through....

 

[mirf]

Is he larger or smaller? Better market? How close is the new location ? Have you considered changeing your name?
I would want one name for marketing reasons but would keep the rights to the old name. Especially internet and licenses with local and state.

 

[Jamesh921]

The other company services mostly upscale rental properties.The company is only 2 years old but has over 500 properties on the customer list, which MUST be cleaned at least once per year.

It's in a bigger market area and is about a 40 minute drive away.

The company also comes with 2 2008 Chevy vans (one 3/4 ton and a one ton) and both have Boxxer 427s in them. Less than 25K miles on each van. All equipment is very well maintained.


This would be a great opportunity to break into a new market. Just tryin' to determine whether to change the name or not.

Thanks

 

[joe harper]

Then..Take the time to PERSONALLY.....stop by and speak with the agent in charge...!!!

Inform them of your recent purchase..&..ASSURE them that they can call you
PERSONIALLY at any time..!

Drop by all necessary documentation they will NEED to..put your company into their
system. "Proof of insurance, 1099 information, business license. ect...ect...!


GOOD LUCK...!

 

[Jamesh921]

OK, so here's how I see it. Tell me if I'm wrong or where you agree/disagree;

PROS (of keeping the "purchased" company's name)

You basically treat this NEW company as a franchise....! Strip all assets over a
short period of time...and create the image of a MUCH LARGER...mother ship...!!!

I've had customers come looking for my old company names after 7 or 8 years.

If the service is GOOD....they will search their checkbook or CC statement...when they
need RE-SERVICE................! "Two chances to get the client back"...Either by payment
record ....or....name recognition of purchased company...!

I do work for Charlie's Tire Factory but a guy named Gary bought it. He didn't change the name but checks are written to his other automotive business, he never even considered changing the name

You would have two points of contact in both markets.

You could get two websites in the top of both your markets. Two points of contact. Two sets of advertising in both markets.

One answering service, two different franchises. One management, two companies. One service department two companies.

Two different identities is not a bad thing……..If you want to sell to every category....2 names is not a bad idea.

.....but i got a bigger machine, and some other tools, and a new base of clients to work through....




CONS (of keeping the "purchased" company's name)

GI Joe's went to Joe's and went out of business

K&M Care Car bought Total Car Care and changed the name, business has been down ever since

I cannot think you would want to keep two identities. Different identities would be a pain to maintain. Multiple trucks with different logos.

Advertising two companies is about 1.5 times as expensive