Client base buying help

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Modify Me

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Hi all

I have today looked at buying a client base from someone with 900 clients on the books. She wants 2k but i think this is a bit steep as i imagine that not all clients will stay, so i don't want to be out of pocket. I am thinking of suggesting £10 per client which would be £900 do you think that is reasonable or am i way off?? I don't wish to offend her in anyway.

thanks

Kerrie
 

Trinity

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900 at £10 is £9000, a pound each would be £900
 

Haircutz

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I strongly recommend you take business advice from a solicitor before making her a definite offer. I also think she has to get the express (written) consent of every client on her books before she can legally sell her client details. Remember the new GDPR regs came into effect last month.

Just a few thoughts that you’ve probably already considered:
Do you know how many clients on this list are regulars and how many are one-off discount voucher type? It’s easy enough to substantially increase the size of your client database with a Groupon type offer, but only a tiny percentage of those types of clients will become regulars.
What are her future plans? How will you ensure she doesn’t keep the regulars for herself?
How much advertising/marketing can you get for £900?
 

CFBS

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Ooo no, don't go there.
As Haircutz says, I doubt she can legally pass on their details without consent from each individual client.
The list may have 900 clients on it but I bet only about 300 or less are actually active clients.

People talk about selling the 'goodwill' of a business and putting a value on it but in our trade, like retail shops, it actually has no value at all.
If the clients don't like what you offer then they go elsewhere. There is no 'contract' for a client to continue to visit a business if they don't want to.

Spend your money on advertising your services locally and you will gain loyal clients.
 

Modify Me

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Modify Me

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Ooo no, don't go there.
As Haircutz says, I doubt she can legally pass on their details without consent from each individual client.
The list may have 900 clients on it but I bet only about 300 or less are actually active clients.

People talk about selling the 'goodwill' of a business and putting a value on it but in our trade, like retail shops, it actually has no value at all.
If the clients don't like what you offer then they go elsewhere. There is no 'contract' for a client to continue to visit a business if they don't want to.

Spend your money on advertising your services locally and you will gain loyal clients.
Thank you that makes a lot of sense, much appreciated xx
 

Modify Me

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I strongly recommend you take business advice from a solicitor before making her a definite offer. I also think she has to get the express (written) consent of every client on her books before she can legally sell her client details. Remember the new GDPR regs came into effect last month.

Just a few thoughts that you’ve probably already considered:
Do you know how many clients on this list are regulars and how many are one-off discount voucher type? It’s easy enough to substantially increase the size of your client database with a Groupon type offer, but only a tiny percentage of those types of clients will become regulars.
What are her future plans? How will you ensure she doesn’t keep the regulars for herself?
How much advertising/marketing can you get for £900?
Very true she mention groupon and quite rightly so I will be double checking the GDPR regs. She is emigrating but I guess that can’t be proved either really. I have been in touch with the landlord and already expressed my interest in the salon without her client base. I do already have my own clients but like you said I could potentially gain a lot more spending the money of advertising.

Thanks for your advice x
 

Haircutz

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In that case... I don’t think her client list is really worth buying.
If you keep the same landline number, I’d guess that the majority of regulars will simply call the salon to make an appointment and when told she’s moving abroad will likely choose to book in anyway, especially if you sound really lovely on the phone.

Definitely spend the money on advertising and possibly a discount for their first appointment, with a loyalty card to encourage them to return.
 

Modify Me

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Thank you so much for your responses all makes perfect sense
 

Persephannie

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I would never buy someone's clients. They are people and can't be bought and dont "belong" to a tech or a salon. Not to mention I would be livid as a client if someone sold my details. I would consider it a total breach of trust and feel the person selling my details would lack integrity and loyalty. Clients have to be earned. I guess this is a hot button issue with me.
 

rubywoo

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If you are buying a business from this woman the client base would be considered part of the goodwill, whilst people cannot be bought and sold, goodwill and intangible assets can. You've mentioned speaking to the landlord about the salon so I'm assuming that she's just shutting up shop and walking away. If that is the case and you retain the telephone number then I'm sure you will inherit a great deal of the old clients. If I was looking at buying a client base I would want to see the revenue generated by this list, how long she has been trading, client retention rates and average client lifespan for the business and make an offer based on this. If you are not buying the business from her but simply taking on the property after she leaves, there doesn't seem to be much need for you to purchase it.
 

Modify Me

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If you are buying a business from this woman the client base would be considered part of the goodwill, whilst people cannot be bought and sold, goodwill and intangible assets can. You've mentioned speaking to the landlord about the salon so I'm assuming that she's just shutting up shop and walking away. If that is the case and you retain the telephone number then I'm sure you will inherit a great deal of the old clients. If I was looking at buying a client base I would want to see the revenue generated by this list, how long she has been trading, client retention rates and average client lifespan for the business and make an offer based on this. If you are not buying the business from her but simply taking on the property after she leaves, there doesn't seem to be much need for you to purchase it.

I met with the landlord tonight and discussed my plans and did some negotiating with rent so I will be taking on the shop after she leaves and I will not be buying her client list. She is shutting up shop anyway and if the clients want to still come and have their treatments they can at their own free will. If she was selling the business with stock etc then I’d have given it more thought. I already have my own client base and can build on this. So it’s a win win for me
 

Modify Me

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I would never buy someone's clients. They are people and can't be bought and dont "belong" to a tech or a salon. Not to mention I would be livid as a client if someone sold my details. I would consider it a total breach of trust and feel the person selling my details would lack integrity and loyalty. Clients have to be earned. I guess this is a hot button issue with me.
I agree completely and although she had said she’d contacted her 900 clients to opt out of the data sharing I am not convinced this has been done. I have a friend that has visited the salon, only once, but surely she’d be one of the ‘900’ and she hasn’t been contacted by her at all.
 

jamiereid92

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If you're taking over a salon then you are handling the data in the same way they have given consent to the previous owner. So you can buy client databases.

If the salon is still there loads of clients will still come you don't really need that database.

You are a very lucky person!
 

Modify Me

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If you're taking over a salon then you are handling the data in the same way they have given consent to the previous owner. So you can buy client databases.

If the salon is still there loads of clients will still come you don't really need that database.

You are a very lucky person!
Thank you, technically there is nothing to buy as I will be rebranding the salon to fit in with my business which already exists hopefully some will come back anyway even if they come for a nose around on my open day!

Argh lots to do
 

House Beauty

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Please bear in mind that she likely cannot legally give their information to you! GDPR! I wouldnt open myself up to being sued by one of them because this previous owner couldn't be bothered to check whether they are ok with it.
 

TheDuchess

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I set up on the site of a closing down salon and I bought some of the furniture and the domain name and phone number etc but not the goodwill. I gave everything a good clean and then replaced everything, one item a month over about 18 months. It saved me loads on my set up costs and gave me time to choose carefully. It saved the outgoing owner loads of hassle and disposal costs so she was really grateful.

It was quite tricky keeping the phone number, so I'd look into this without delay. I set up a redirect for two years on the old domain name.

It was all very amicable and it felt "honest". From Day one though, it felt like my business, I never felt I was benefiting off someone else's hard work. My own website scored much higher for Google analytics.

We weren't on a busy high street so we never got much in the way of walk-in business, but we were on a bus route, and near a set of traffic lights. I had the Windows made over displaying a list of our services and we got loads of business from students that saw us on their route to Uni and rang in. People sometimes mentioned that they'd been to the previous salon, but they were clear that we were a different business.

Ultimately a business is in the image of the owner. I had a different vision, so even with the same furnishings I rearranged everything and made the place my own, people realised instantly that we'd changed ownership - I didn't offer the same treatments and I changed skincare brand. The previous owner had her business for 7 years. I doubled the turnover within 2 years with a different mx of products and services.
 

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