Bought a business on contract, can we get out of contract?

Question

This spring we purchased a lawn company on contract. However, the number of accounts that we agreed to buy has significantly dropped, resulting in us paying more than the business is worth. The contract states that they will give money back for each account lost, however the refunded amount is only 25% of what we have paid. We signed the contract and never thought so many accounts would have been lost. Now we would like to get out of the contract. The contract does not list what will happen if it is broken. Even though contract was signed can we get out of it because of unfair terms?

Answer 1

the problem is the seller will probably state you caused the loss of accounts by bad service.

that is the reason it is capped at 25%.

make a list of all the accounts you lost and find out why they stopped using your service.

if it is not your fault (meaning bad service). go back to the seller and tell him you want to re-negotiate.

be nice at first and reasonable. you can always escalate it to an attorney if you can demonstrate the seller listed accounts dishonestly or fraudulently.

Answer 2

i tend to agree with Rabbit and he pointed out some good things and you do have an edge . But if you bought the business and the customers were there you really have no legs to stand on . caveat emperor is the old adage - like buyer beware . Did you taklk to all the clients before you closed on the business ? If not shame on you . it takes a moment to lose a customer but a lifetime to build trust up with a client so therefore maybe you need to mend some fences too . By the way that was a very generous default he gave you up to 25 % whereas most businesses would give 10 % max . good luck .

Answer 3

Unfair terms? Listen, moron, customers are not bricks on your wall, You have to earn their business. What you got is a list of people who had done business in the past, not an automatic money tree. What have you done to reassure them that whatever it was that made them customers before WILL continue, and possibly even better. Your previous management had a relationship with their customers. Unless you build that relationship, it is akin to trying to bed a woman down without the courtship and foreplay--she will likely call it rude at least but rape if you persist. It takes time to court and acquire a customer, but just moment to lose them. You still have an advantage over competitors, you know exactly who to see and exactly what they like, now you have to get them to like you well enough to get them to do it again for you.

Get your list, start with the biggest ones, or the ones whose needs are closest to what you do best, and practice this line, or something like it, "I'd like to talk with you, let me buy you lunch." You invested in the predecessor's book of business, now you have to invest in your business' customers.