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logan
06-28-2006, 08:27 PM
I was talking to a lawn service who has been in business for 20+ years. He told me that he talks to his customers personally when he feels they are due for a price increase. Here is the thing that stuck me. He asks them what they feel is a fair dollar amount. He told me that he feels they will not feel as upset about it if they have a part in the raise. He just had one of his best customers raise him up $15.00 a week. It seems that if you could get responses like that or an average of say 5-10 a week more that it would save some of the customer loss that you typically get when raising rates. It also seems like it would let you know which customers are good, by their willingness to pay you a fair amount. I do think that it might come across as unprofessional though. What do you guys think?

Splicer
06-28-2006, 08:45 PM
LCO: Ma'am I am going to have to raise my prices and I was wondering what you thought would be a fair amount?
CUST: Well my goodness! Well I would say $5/wk would be fair...
LCO: Well too bad I'm raising you $10 because that is what is neccessary.
CUST: See ya! Don't let the door hit you on the ass...

$15??? What justifies such a sharp increase?

logan
06-28-2006, 08:57 PM
I am sure that his customer had been with him for a long time.

TURF DOCTOR
06-28-2006, 09:34 PM
I'm there to cut the grass and nothing more or less, the less i see of my client base the better cut and trim and send em a bill and hope you get paid in a few days.

BSDeality
06-28-2006, 09:39 PM
a guy who has been in business 20 years said that?

He must be the luckiest person alive then. If he doesn't know what his numbers need to be each month/yr and lets the customers pick the number for him then there is something very strange going on.

topsites
06-28-2006, 09:46 PM
I do myself ask my customers, especially those I like working for.
Now I don't ask what they think is fair, I just let them know I am thinking of a voluntary $5 price increase.
Some look at me kinda funny but I explain it is voluntary, that means whether they agree or not, I will continue to service their lawn regardless (and I mean it). If they still kinda don't understand, I say: Look, not every customer of mine stays with me when I raise a price, I have lost too many customers over this and to me it is not worth losing you over 5 bucks, so you decide and I promise, no matter what the choice, I will service your lawn regardless.

You'd be surprised, I get around 1/3 to 2/3 go for it, while those who decide to wait, at least I didn't lose a good customer over it.
Every year I get a few this way to increase the price, it kinda 'doubles' the number of those who take it upon themselves -
So it's not a LOT of them, but between those who take it upon themselves and this, it makes a difference.
Plus it seeds the fact in their mind: it is coming.
To more than a few people, even if it HAD to be coming, it can still be a shock.
So this puts the thought there without twisting their arm, and even if they say no, I find a year later they usually go for the increase...
So I have to wait a year sometimes, if the customer is worth it then so is the wait.

I think it's a savvy marketing technique, a soft price increase if you will.

logan
06-28-2006, 09:52 PM
He mows only residential properties. 1/2 acre on up. He currently has around 50 customers at $160.00 a month and up. I worked with him for a while 4 years ago. He explained to me that the cost of living does not affect him, it only affects his customers. He is very legit and runs a 60inch turf tiger, 60 inch Dixie chopper and and older Scag Z 48 inch. I still talk to him to see whats new and we see each other at the Mower shop at times. I am glad to have talked to him before I got into this business since i would be out of business by now. So many people are charging half of what he charges, when the market obviously will bear more.

lawnman_scott
06-28-2006, 11:04 PM
He mows only residential properties. 1/2 acre on up. He currently has around 50 customers at $160.00 a month and up. I worked with him for a while 4 years ago. He explained to me that the cost of living does not affect him, it only affects his customers. He is very legit and runs a 60inch turf tiger, 60 inch Dixie chopper and and older Scag Z 48 inch. I still talk to him to see whats new and we see each other at the Mower shop at times. I am glad to have talked to him before I got into this business since i would be out of business by now. So many people are charging half of what he charges, when the market obviously will bear more.Does he not pay taxes, insurnace, gas, groceries, electric bill............ or does he tell them he thinks the prices should only go up a set amount when he goes to pay his bills? Hey!!! Get him to buy you stuff at the mower shop, I bet he gets a good price compared to you.