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View Full Version : Customer will pay me $25 an hour for help, but not two ppl 25 an hour


Eho
05-14-2005, 01:11 AM
I customer of mine( very, very good one too) wants me to do some major bushes trimming. He has a ton of bushes on the property including some 15 ft. bushes that will require a ladder and some major cleanup. This might even take me about 4 hours to do solo. I mentioned that it will cost 25 an hour( kinda cheap, but hes a good customer) and the guy is fine with that. Then I mention I might hire a helper and it would be 25 per man hour. In theory, this would cost the same price. He says that I cant do that and he will not pay 50 an hour. I m thinking to myself: If it takes me four hours, thats 100 bucks, if it takes the two of us two hours, thats 100 bucks..whats the problem. Do most of yall guys charge per man- per hour. I thought I was right in this situation but I ll do it alone cuz hes a solid customer. What are yalls thoughts
EHO

Todd's lawncare
05-14-2005, 01:20 AM
maybe tell him it will be the same price either way or just do it alone if your not busy

PLM-1
05-14-2005, 02:11 AM
Wow...he must be a good customer. I wouldn't touch a bush for 25/hr. A lot of ppl get turned off on "by the man hour". I prefer it that way. I get a lot of questions like "this says eight hours...but you were only here for 4". Some people are dumb!

alwaysgreener
05-14-2005, 07:03 AM
Not to sound mean but… It is not the customer's problem that it will take you 4 hours to do the job. You have to know you’re pricing before you bid a job, yes he may be a good customer but is it worth 100 dollars? And you never tell a customer “Then I mention I might hire a helper and it would be 25 per man hour” Again not his problem, just remember do all the math first then submit the bid.. :rolleyes:

Precision
05-14-2005, 07:35 AM
Not to sound mean but… It is not the customer's problem that it will take you 4 hours to do the job. You have to know you’re pricing before you bid a job, yes he may be a good customer but is it worth 100 dollars? And you never tell a customer “Then I mention I might hire a helper and it would be 25 per man hour” Again not his problem, just remember do all the math first then submit the bid.. :rolleyes:

Couldn't agree more.

If you think it will take 4 man hours. Then you should be charging whatever your rate is times those number of hours.

Mr Jones, that trim job will be (quick mental calculation 4 hours x $100) $400 plus the disposal fee of $75, for a total of $475. We have an opening in the schedule on Tuesday afternoon next week. How does that sound?

Bidding by the hour is a losing proposition. It makes it seem like you have no idea how to price. Always makes the customer think you are milking the clock. Leaves them room to complain on price. Bid for a completed job for a price. If it takes 10 minutes they got the job done at the agreed price so no worries. If it takes 10 hours, well you need to learn to estimate better, but it is a lesson you will not quickly forget.

But the bigger problem, can you really work for $25 per hour? I can't even think of working that cheap. Is your overhead really less that $5 per hour and that means you still are earning only $40K (pre taxes) if you run full time and that is only counting billable hours.

My overhead is closer to $15 per hour all things counted and averaged. NO WAY I am working for $10 net per hour. I pay my helper $12.

cajuncutter
05-14-2005, 10:12 AM
I agree with Precision, however I did do a job 2 weeks ago that caught me off guard. This guy has this MONSTER home right in the middle of about 29 acres. Not all of it could be mowed due to heavy under growth in some areas. I just told the people it was $35/man hour. 4 people, 2 mowers and 2 weed whackers with a little stick edging, logged 33.83 man hours. It was a hell of a day I can tell ya. I have never done such a big property but now I know how to price it accordingly. This place usually has a full time staff doing the yard while on payroll but the last batch quit and this people were desperate to have it done. Unfortunately it is not a full time gig. It would be nice to land it so I could drop some PITA's :D

brucec32
05-14-2005, 08:42 PM
Couldn't agree more.

If you think it will take 4 man hours. Then you should be charging whatever your rate is times those number of hours.

Mr Jones, that trim job will be (quick mental calculation 4 hours x $100) $400 plus the disposal fee of $75, for a total of $475. We have an opening in the schedule on Tuesday afternoon next week. How does that sound?

Bidding by the hour is a losing proposition. It makes it seem like you have no idea how to price. Always makes the customer think you are milking the clock. Leaves them room to complain on price. Bid for a completed job for a price. If it takes 10 minutes they got the job done at the agreed price so no worries. If it takes 10 hours, well you need to learn to estimate better, but it is a lesson you will not quickly forget.

But the bigger problem, can you really work for $25 per hour? I can't even think of working that cheap. Is your overhead really less that $5 per hour and that means you still are earning only $40K (pre taxes) if you run full time and that is only counting billable hours.

My overhead is closer to $15 per hour all things counted and averaged. NO WAY I am working for $10 net per hour. I pay my helper $12.


There is always more than one way to skin a cat. There are pros and cons to each way of doing it. Think of it this way.

1. Say a guy makes most of his income mowing lawns and doing regular stuff onsite.
2. Shrub work is a source of a lot of conflict, since beauty is in the eye of the beholder, and there are differing legitimate ways to prune shrubs. I always wonder if I'm going to get a call after doing shrubs telling me they wanted it done differently.
3. What exactly constitutes "trimmed" ? You may feel that cutting off the new growth and doing a little light reshaping is fine. Your customer may be expecting a severe cutback and shaping that could easily take three or four times as long as a simple touch up. You may like them rounded and natural looking. He may be expecting cubes done to the precision of topiary. I don't have customers that have time to meet me to discuss how each shrub will be tackled. And I wouldn't want ones who cared. But after the fact, if they pay a set price, they may feel they didn't get what they wanted.
4. What constitutes proper cleanup? Every piece of material removed? Just the biggest part? Ever try to blow cuttings out of a bed w/o removing mulch once you get past a certain point? Do you clean out cuttings even when the beds underneath are already full of last year's leaves and weeds? Ever try to pick up by hand 50,000 seperate cuttings so a finicky customer is happy? See how maybe a customer is willing to live with a good job that saves time and money, vs. expecting perfection that will only cost him more as you work longer?
4. Customer isn't happy with job for your quoted price. He forces you to return and do more work than you planned to for the same fixed price. Or, he cancels regular maintenance agreement worth $1200/year over your $200 shrub job where you're disagreeing over about $50 worth of it.
5. Charging hourly, the customer is inhibited from nit-picking, you get paid fairly for your time, and if a customer does want more done, he has to pay you for the extra time. Just give a general estimate of the time required and then beat that estimate so they feel they got a deal.
6. For a set price, you or your employees are at least sub-consciously encouraged to rush and cut corners to "beat the clock". This could result in more negative situations.
7. With set-price bidding, you have the opportunity to make more if you price it right and if the customer accepts your high quote. But the downside is that you can also guess wrong. Adding a "fudge factor" to make sure you err in your favor, not theirs, just raises your price, which is always subject to being rejected as too high.

I can always estimate the time it takes me to do the job MY way. But I can't always assume the customer wants the job done that I'm going to do. There are just too many variables with shrubs, unlike mowing a lawn.

I realize that people may be suspicious about how fast you're willing to work. But I find that once they know me for a season, they realize I'm honest and work hard. Again, putting a top-range of time is a good way to assuage their fears on that.

Sometimes trying to maximize income can result in losing money in the long run. My goal is to minimize customer conflict while protecting my long term money. I don't want to cause hard feelings squeezing out a few more dollars on what is to me a minor source of income anyway.

Precision
05-14-2005, 09:46 PM
I never do any one time trimmings without the customer meeting me onsite to review what they want. In my part of the woods, a one time trim job means 2-15 years of deferred maintenance. Everything is reviewed, notes are taken, a written proposal is submitted, the proposal is signed off on and a 40% deposit is recieved prior to any work being done.

I usually am also able to get add on sales, mulching the beds (makes the cleaning up of small debris so much easier. Just throw the mulch on top), weed removal, shrub or lawn fertilization, monthly maintenance contract.

Bruce, I am sure your system works for you as mine does for me. But all my clients must make time to meet if they want me to perform work. Closing rate on meetings with clients is 35-50% depending on type of work (mowing lower, trimming and clean ups higher). Closing rate on "just drop off an estimate" less than 5%.

If I have to take the time out of my schedule to look at your property you should at least have the courtesy of meeting me there.

Green Pastures
05-14-2005, 09:57 PM
I tell my customers the price and then I do it with how ever many people I want to bring with me that day.

Why are you letting your customer dictate how you run your business?

Do you tell the plumber how to snake your drains?

Remsen1
05-14-2005, 10:55 PM
NEVER tell price per hour. EVER.

drsogr
05-14-2005, 11:13 PM
NEVER tell price per hour. EVER.

Agreed! If you start giving your price per hour...then people will compare what they get paid to what you get paid. They will wonder why this loser makes more than they do. Bid it...do it...review it. Sometimes you will lose...sometimes you will win. If you bid enough you will barely ever lose.

hole in one lco
05-14-2005, 11:21 PM
bid the job and let them know that a estimate is a estimate not an invoice.

Soupy
05-15-2005, 02:25 AM
If you consider this guy a solid customers... I would hate to hear about some of your not so solid customers. Never let a customer dictate how you run your business. If he doesn't agree then don't do the work.

Precision
05-15-2005, 10:15 AM
If you consider this guy a solid customers... I would hate to hear about some of your not so solid customers. Never let a customer dictate how you run your business. If he doesn't agree then don't do the work.


Very true.

A good customer is one who never complains, when he has a question asks politely and gives you the respect of allowing an answer without interruption, pays well and on time, when he has a difficulty with your work (or missed something) is polite and understanding that compared to a years worth of flawless performance, missing the edging on one side of his drive isn't any big deal, Refers you to friends AND tells them you aren't the cheapest, but you are well worth it. When he wants extras done, calls ahead and schedules it, not expecting you to do it on his mow day or because he has a party this evening and forgot to tell you for the last 3 weeks.

Asks your prices and accepts them or not but doesn't try to haggle you down. Accepts responsibility when he hires in a scrub to do the job cheaper and gets a crummy job, then tells you he should have and will do what you suggest from now on.

Lux Lawn
05-15-2005, 10:22 AM
I would tell the guy that you don't work alone and with the amount of work you have this time of year its more productive to have two men on every job instead of one.If he still doesn't like it tell him you have some other jobs to do first and stall him a little...if he wants it done quickly he will let you bring your helper.

LawnsRUsInc.
05-15-2005, 11:58 AM
I personally think less is more. You were telling your customer things that is none of thier business like how many guys on the job. Also 25 dollars an hour seems way to low you need to figure dumping, drive time, all of the administrative fees that you incure. Everyone runs thier business but we charge $45 an hour per man for trimming shrubs but we bid by the job not the hour. Also with what customers want thier shrubs trimmed like should be your discretion not thiers your the proffesional, just tell them what they need done.

Eho
05-15-2005, 02:55 PM
Ok...In response to my cost per hour, I understand it's low,but this is a very minor source of income. In fact, I love just mowing but i hate doing cleanup and extra work. I basically only do it to keep the customer happy. Anyways, i m still pretty small( mowing about 20 a week now and still in college) and the reason I say they are a good customer is because they are. Before this, PERFECT customers...no problems at all. This was my first ever" nice " lawn that I did weekly which I started doing about 4 years ago. Also, they pay me well to mow, very nice people. Anyways...I guess in the future I will price not per hour. The only thing is, what if it turns out to be a lot harder than I originally planned and dont get paid properly. I m considering getting even more lawns next year and only mowing and just referring ppl for extra work to another company.
EHO

Watkinslawnservice
05-15-2005, 04:56 PM
NEVER tell price per hour. EVER.
I agree. I always estimate and give a price accordingly. Usually I add a little on if I am not exactly sure how long it will take.

I was approached once by a client of my wife's whom she cleans house for. They live in a ritzy neighborhood on a golf course and seem to have all kinds of money. They wanted all kinds of things done like 25 yds of mulch installed and lots of other things. I gave them a bid that he cringed at because they are actually very cheap. There was no way they were going to accept this so being the nice guy that I am(plus my wife likes them and cosiders them a very good customer) I decided to tell them that I would do it by the man hour and since they are used to paying my wife $25 per hour I believed that they would have no problem paying me $25 per man hour. Well they thought that it was rediculous that they would have to pay $25 for me AND my helpers. What they didn't realize was that they were getting a very good deal because I usually charge between $35 and $45 per man hour plus a little extra built into the quote just in case. They said they were going to find someone else but I found out that they ended up doing it themselves. Who's gonna do it cheaper than that?

Watkinslawnservice
05-15-2005, 05:10 PM
Ok...In response to my cost per hour, I understand it's low,but this is a very minor source of income. In fact, I love just mowing but i hate doing cleanup and extra work. I basically only do it to keep the customer happy. Anyways, i m still pretty small( mowing about 20 a week now and still in college) and the reason I say they are a good customer is because they are. Before this, PERFECT customers...no problems at all. This was my first ever" nice " lawn that I did weekly which I started doing about 4 years ago. Also, they pay me well to mow, very nice people. Anyways...I guess in the future I will price not per hour. The only thing is, what if it turns out to be a lot harder than I originally planned and dont get paid properly. I m considering getting even more lawns next year and only mowing and just referring ppl for extra work to another company.
EHO
If you price this "extra" work the way I know you can it would be a more major source of income. I am smaller even than you, but I will have derived almost as much income for the year doing clean-ups, Aerating, dethatching and other extras than I will from mowing. I already had pocketed thousands this spring before the first lawn needed to be mowed. Also don't start refering all these extras to other companies because they will start stealing all of your mowing clients and then you will have nothing. If you dont personally like the work then just get the jobs and hire help to do the work, tell them what to do and go get a big mac.

Precision
05-15-2005, 09:44 PM
If you price this "extra" work the way I know you can it would be a more major source of income. .


Exactly.

People think that any shmuck can mow their yard, hell they did it for years. And there is some truth to it. Now getting it to look great, that is a different story. But, the bottom line is many people are paying to have the grass cut and don't want to pay much because they view it as easy and they don't want to understand they are really being charged for the convience of not having to mow.

With extra's like hedge trimming, sod work, irrigation repair, major pruning, spreading mulch; they know it is hard crappy work that they will never do or do properly. This type of work is the easiest to make money (BIG MONEY) on. They value the service, so they will pay for it.

I just had a new client need 500 square ft of sod replaced from chinch bug damage. I told her it only comes in 400 sq ft pallets and my price is $275 per pallet installed. Without blinking an eye she said ok, and can you dispose of the extra sod for me. Sure. Good guy that I am, I didn't even charge her for that. I needed some sod at my house, so bingo free sod for me.

Bottom line, my cost on sod $250 delivered. 1.5 man hours of ground prep. 1 man hour of throwing sod. $550 paid to me and I got 300 square foot of sod for a tip. $120 per hour isn't bad.

Price things you don't like higher not lower. That way if you get it at least you get paid.

DFW Area Landscaper
05-15-2005, 11:37 PM
++++$120 per hour isn't bad.+++++

$120.00 per man-hour isn't bad, but realize, you didnt' make that much.

How much time did you invest in driving out to first diagnose the problem, explain to the customer what the problem is, take measurements, call the sod company for a price and then put a proposal together? And remember, if she wouldn't have been willing to spend the money, you'd have done all that for free.

I'd guess that for every customer who is willing to pay for the sod install, there will be one that won't, so half the time you're going to do all the above work for free.

Another thing to think about: What are the odds that the customer will b!tch and moan about the sod not being smooth enough? Or that the sod is too high above the surface of the sidewalks and curbs? If they complain about this stuff, you will have no choice but to go back out and do additional work. If you make an error, such as accidentally covering a sprinkler head with a piece of sod, you will have to make another trip out there and do additional labor for free. If you can't find the control valve, you'll have to schedule it at a time when the customer is home so they can turn the system on from the electronic control box. If the customer doesn't water properly and the sod doesn't survive, you will have pressure to do it over again for free. And if you stand your ground and insist the customer's watering habits are to blame, there is a good chance you will lose an otherwise perfectly good maintenance customer over the issue. Lastly, if you didnt' need 300 ft of sod, you'd have to dispose of that extra sod, which could mean a trip to the dump...bottom line, disposing of extra sod is more work.

Anytime we do anything other than one of our three primary products (mowing, bed weed control, lawn applications), we charge by the hour. It is just too easy for a customer with a firm price to take advantage of you by expecting more work than what you were expecting. Not only that, estimating shrub work is very hard, even for someone with a lot of experience. When we provide an estimate, it is just that...an estimate. Not a firm price quote. I try to make this as clear as possible with all of my customers.

If I could refuse non-recurring work, like shrub timming, sod installs, etc, I would in a heart beat. This kind of work is a fool's game, in my opinion.

1.) Everybody wants a free estimate before you do the work.
2.) You have to own a tremendous amount of equipment to trim shrubs and dispose of the debris.
3.) Real demand only lasts for about 2 months per year.
4.) Workman's comp insurance wouldn't be a blip on my radar screen were it not for chain saws, articulating hedge trimmers and chipper shredders.
5.) The work is very easy to underestimate, so we always charge by the hour. If the customer isn't home when the work is done, and there was not an estimate already done, the customers don't understand how it could have taken so long.
6.) There is all kinds of wiggle room for a customer to say they don't like it when your done and insist on a discount. Unless they pre-paid the job with cash, they have the power to dictate the amount of the discount. They can either with-hold payment if you've done it on credit or they can dispute the charges with the credit card company.
7.) There is a risk that you will lose a good mowing client because they don't like the way you trim shrubs or they don't like the prices you charge.
8.) With next day credit cards, the most I risk in the way of ucollectibles is a single mow or a single app. With shrub trimming, if the card is declined, I could get stiffed on several hundred dollars.

I hate the non-recurring work, but I know we'd lose too much business if we didn't offer it. I'm not aware of any landscaping companies in my area that don't mow lawns, so telling them to hire someone else to do the non-recurring work is very risky.

Later,
DFW Area Landscaper