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View Full Version : RAISING 2001 RATES...


gway
03-08-2001, 09:59 PM
last year i maintained your lawn at say...$25 this year im bumppin it up to $30 for obvious reasons as we know, i failed to get a news letter out to my cust regarding this price hike but i do grade A work and my cust know this and when they recieve thier first statement from me should i expect that most not all will go along with this $$ increase?? i will explain my self in a professional manner when they do call and ask about the increase but for the most part am i going to be shocked and find everyone running for the door or will they understand the $$ situation...just asknn??

grade
03-08-2001, 10:14 PM
Customers need to understand you get what you pay for like anything else prices go up if you do the good work you say you do your customers should not have a problem if there only shopping for price their most likely not the customer for you anyway charge what you feel your work is worth.

dmk395
03-08-2001, 10:20 PM
Hey Grade, where in Ma are u from?

joshua
03-08-2001, 10:20 PM
grade i say the same thing i want a customer that is willing to spend alittle more to have their lawn look the best on the street unless i have a few on the street but you know what i mean. there are to many jobs out their to settle with getting $20 for a $30 lawn. same with all the extra's, i want someone who wants them, more jobs will come.

gway
03-08-2001, 10:24 PM
thanx grade for responding...

i sent out my letters 5-6 weeks back for all other services but i failed to mention that the $$ for the cut has gone up like i said from 25-30 now and i just hope i dont send too much shock .. but i know that the new est im doing are startin at 32-35$$ so they will be easilly replaced i just dont wanna loose too many due to the $$ increase..

thanx again for the spoken word...

grade
03-08-2001, 10:44 PM
Gway one more bit of advice before you send out the invoices soften the news with your explaination first
this way they know what to expect.

DMK395 southeastern how bout you?

Runner
03-08-2001, 10:59 PM
Gway, Let ma get this straight. You are increasing your cutting prices, but you haven't let your customers know yet, and you are just going to wait until the first bill? If this is the case, you are looking for alot of headache and trouble! Let your customers know ahead of time. Don't just jack up their prices and expect them to just say o.k.. If you send a letter, they will be alot more understanding than if you send them a bill for 20 dollars more. Many will be upset just for the principle of it. If your work is this good, continue your professionalism by giving them PRIOR notice of another price increase. I'll tell you, one good way to do it woud be by phone call. That would help you explain the increase and answer any questions as well. People LOVE personalized one on one contact! That is one of the biggest assets to a successful company. Good luck!

Randy Scott
03-08-2001, 11:22 PM
I know you are using a price of $25 a cut to the price of $30 a cut in the increase. Is that the actual numbers or are they different? If those are actual numbers, that is a 20% increase and that is alot to ask of a customer to have to pay for inflation. Cost of living is usually 3% to 4% a year. If you raise it that much,(20%) you will surely lose customers. If you did it for that price last year and it was too cheap, that is your fault, not theirs. If you do not care that you will lose them because you are not making out enough, then that is what you will have to do. I understand you have to get paid for what you do, but put yourself in their place. I am sure you will keep many customers also if your work is good and they are happy with you. :) Good luck with whatever you decide!

jeffyr
03-08-2001, 11:37 PM
I agree with Randy....20% on cuts is alot to spring on someone...especially without notice. This should have been stated in your earlier letter. Can you increase all services by 3-5% to average the same $$ ?

jeffyr

1MajorTom
03-08-2001, 11:48 PM
Price increases are always a touchy subject. It is like I agree with opinions on both sides.

I remember reading one post that Bill the Lawnguy made. What he said made so much sense to me. He said something to the effect, Do not nickle and dime them every year and I thought, wow he is right.

Then I started thinking, wait a minute. I began to imagine some of our good customers getting a 5 or more dollar increase, and I knew they would not want to go for it.
But a one, two or three increase and they would not even consider changing lawn services.

Let us just say you have 80 weekly customers. You raise each of their prices one dollar. $80.00 extra a week, $320.00 a month, $2240.00 extra for 7 months. I do not think that is bad at all. Heck, they spend that much money on a cup of coffee each morning.

Currier
03-08-2001, 11:49 PM
Lots of good points! I would forewarn them. The trick is, do you have a plan? This year I totally changed my pricing and billing structure because I finally developed a plan that will allow me to make money and stay in business. Yes I lost 9 customers all due to price. But so far I have picked up one new customer and one landscape job that will cover more than the nine would have paid if I had kept pathetically struggling.

This is a tough time of year. There is always that fear that we will not get enough! Yes, we say they are easily replaced, but do we believe it? It is tough. $5.00 really isn't that bad especially if you haven't raised for a few years. Use the old Uncle Sam and OPEC reasoning in your letter. I'll bet they will understand.

grade
03-09-2001, 12:15 AM
It all comes down to charging for the quality of work you do
alot of my customers had previous landscapers and they were not satisfied,the price might have been right but the quality of work was not their I would give them a price of lets say 50.00 and the response sometimes was I used to pay 35.00 what I would say to that is let me maintain the lawn if you don't notice a difference after a few weeks just pay me what you owe me and I'll be on my way.Each time the customer did notice a difference and had no problem paying the extra.By charging a little more you can afford to do those extra little things that really make a landscape stand out and believe me people do notice.

Twotoros
03-09-2001, 01:12 AM
So far out of 18 responses I lost 3 lawns. 1 for a .50 cent raise,another for .75 and the third for a buck. One I raised 4 bucks and hoped to lose went with me another season. This is one tightassed town.

bobbygedd
03-09-2001, 01:25 AM
last year i raised all my cutting prices by $2. i send out a notice every year to exsisting customers stating that we r making our schedule, and that we would appreciate a phone call or email to confirm that u would like to have us again. also due to ever increasing prices of dumping fees, fuel, etc. we r forced to raise our prices , we r sure u will find the increase very reasonable. the new price for your lawn cutting is..... i have not had one customer even mention it, or cancel. bob

mowerman90
03-09-2001, 08:07 AM
Last summer I raised my monthly price buy $5 per month ($1.25 per cut). I gave them advance notice 30 days prior to the increase by including a letter with the previous months statement. of the 70 customers I had guess how many dropped me? NONE! Guess how many complained? NONE! If you do good work and treat you customers fairly they know when their gettin a good deal.

sgreanbean
03-09-2001, 08:32 AM
if i raise my prices ill lose them to vulturs!,my town is very tight as well, they pick price over quality, i think its sad but i have to deal with it or the other guy will get it, im thinkin about movin! hows the SC market!

Greenkeepers
03-09-2001, 09:03 AM
$5 without telling them??? Sounds like you will loose a bunch of customers.. I raised my clients all by $1-2 and I've had people calling about that , this was given to them in their contract renuals.

TJLC
03-09-2001, 09:13 AM
I also live in a cheap area. I havn't raised prices in almost 3 years. It's too late to raise for this year, so maybe next year. I have one customer who wants his vacant lot cut twice a month and no more. He's one I should definately raise. I guess I'm just too easy.

mowerman90
03-09-2001, 01:34 PM
TJLC
What do you mean it's too late to raise prices for this year. The way I see it it's too early. I raised mine in the middle of the summer in July. I felt this was the BEST time to raise'em because in the middle of the summer everybodys got too much work and don't need to take any more lawns on, thus making it harder for customers to find anyone else to do their lawns.

Fantasy Lawns
03-09-2001, 03:39 PM
that's a good point ...price increase in like June-July ;->

Ocutter
03-09-2001, 11:17 PM
I raised all my people a buck or two, added delivery prices, tax and dummp fees. I let them know in January to play it safe. So far 2-3 may drop out of 60 cust. They say to expect a 10% drop rate due to price hikes. Fine by me.

kutnkru
03-09-2001, 11:41 PM
I think that it would be an incredible dis-service to your clients if you did not notify them of your price increase. Just remember that they are expecting you to be the same as last year because they have not heard otherwise from you.

If I had to gaze into the crystal ball, I would say that you would be lucky IF they pay you, (because you never had a contract with them for this season - unless you had a multiple year contract previously signed) and that you will have worked for free. Clients will be lost as well and probably would have most likely accepted your proposal, but out of a disrespectful decision on your part they cancel.

Just my .02
JKris

[Edited by kutnkru on 03-10-2001 at 04:44 AM]

Mowman
03-09-2001, 11:47 PM
gway,
I have letters printed up to send to all my customers with a price increase enclosed. It's only a $5.00 increase but I look to lose a few customers. Now a days people want you to work for nothing, especially the seniors that are on a fixed income, so they say. I expect two of them to drop service. I will be sending out the letters next week. That will give them time to price shop and hopefully find that I'm still the best price in town. I would not cut their lawn without telling them that I am raising my prices. First I am afraid they will not pay the increased price because they were not told of an increase, therefore I no longer need your services, I will find someone that is up front about the cost of their service. Just my opinion about not telling people first. Example: I took my Walker in for a new gearbox in November. Dealer said for the box and labor bill would be $198.00. When I went to pick it up the counterperson told me my bill was $395.96. I was PISSED off right now and wanted to know how $200 went to $400 in two weeks. I just think it is best to let your customers know of the price increase before the season starts. What if the increase is not in their budget? But hey it is your business so do as you wish, I would just not do that to my customers, if they discontinue service so be it. At least I will know where I stand before the season starts, not after I start cutting and several quit because I did not tell them I was rasing prices.
Just my .02 cents
Mowman