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DFW Area Landscaper
09-13-2006, 10:20 AM
Sometime in late June of this year, I decided to create a line item in Quickbooks for non-revenue producing customer contact, as follows:

Cancel Service
Switch From Weekly To Bi-Weekly
Switch From Bi-Weekly To Weekly
Customer Complaint, Comment or Request

Since I started tracking the change, I have noticed a trend. The trend is this: A client calls and says "My grass isn't growing very fast. I'd like to have you guys start mowing every other week." So I take their request, go over the fert restrictions and then, towards the end of the call, I mention, casually, that we do charge $5 extra for every other week service. On the phone, no one has ever complained about the extra $5.

One lady, who requested this change via e-mail, and who did finally accept the premium charge, argued about the charge, back and forth via e-mail, for what must have been a day.

Since I've started tracking these non-revenue items in Quickbooks, I can plainly see a trend that I wouldn't have noticed before:

The request to switch from weekly to bi-weekly service is often followed closely thereafter with a cancellation.

I don't remember having this problem last year. But last year, I was not charging the premium for bi-weekly service, nor was I documenting any changes in Quickbooks.

Of the 17 clients who have switched from weekly to bi-weekly since June 20th, we failed to raise the price on 2 of them. Of the remaining 15, 4 of them later called to cancelled service entirely. I am guessing the $5 premium has a lot do with it, based on a quick exit interview with one of them this morning. He expressed dissatisfaction with the $31 price tag (which he referred to as $35 and it is closer to that after the sales tax.)

My question is this: Would you continue to raise prices on existing clients who switch from weekly to bi-weekly?

Later,
DFW Area Landscaper

scott's turf
09-13-2006, 10:43 AM
I think your policy is more than fair. I don't think you are losing customers based on this $5 increase because most are trying to save money on a monthly basis not a per unit cost. For example a $30 weekly cut costs them usually $120/month. The biweekly is $70/month. They are still saving $50.

Daner
09-13-2006, 12:10 PM
I would not charge the extra 5 bucks...That could be just enough to PTO
Then triggering a cancellation.
Some are on a budget and watch there funds carfully.

grassmanvt
09-13-2006, 12:18 PM
Seems fair to me to. Now, even though you are seeing a trend, I am wondering if they were likely to cancel regardless now that things are slowing down a bit. It seems that there is a certain demographic that will cancel and look for a cheaper service from season to season anyhow.

J&R Landscaping
09-13-2006, 01:11 PM
Are the customers who cancelled service new customers (2 years or less) or have they been with you for an extended lenght of time? Also, are the customers who quit full service customers or just weekly mow and go people?

John Gamba
09-13-2006, 01:14 PM
[QUOTE=


My question is this: Would you continue to raise prices on existing clients who switch from weekly to bi-weekly?

Later,
DFW Area Landscaper[/QUOTE]


Yes---for the reason they dont do twice the work for half the money on there job?? Do they??

sperho
09-13-2006, 02:41 PM
Sounds like free market economics to me. It sounds like at $31 you are above market price and you've priced yourself out of business. Good on your for catching it; now you might use that information to govern your price increases and/or premiums in the near and more distant future. Or find a way to increase your value/level of service compared to what you currently provide so that you can command the premium...

John Gamba
09-13-2006, 02:48 PM
Sounds like free market economics to me. It sounds like at $31 you are above market price and you've priced yourself out of business. Good on your for catching it; now you might use that information to govern your price increases and/or premiums in the near and more distant future. Or find a way to increase your value/level of service compared to what you currently provide so that you can command the premium...


Or get out of a business where you are dealing with part timers and the like.

DFW Area Landscaper
09-13-2006, 03:08 PM
90% of all our clients have been with us for less than 2 years. All of those who switched from weekly to bi-weekly were fairly new and the vast majority were just having us mow the lawn.

It really depends on the amount of rainfall. Often, the bi-weekly accounts are a lot more work. Other times, they are no more work than if done weekly.

It is common practice for LCO's in my area to advertise higher prices for bi-weekly service. Whether or not they actually charge the higher price for bi-weekly is unknown. Most are so desparate for clients, I imagine a lot are waiving the premium when prospects call for a price.

I only started insisting on the $5 premium earlier this year. Last year, I did not charge extra for bi-weekly, but that was before I realized how many would break their promises about fertilizing and then play dumb.

Later,
DFW Area Landscaper

MountainMow
09-13-2006, 03:19 PM
These must be pretty small yards?

tacoma200
09-13-2006, 03:32 PM
Just wondering if the lawns are irrigated? Just North of Dallas in OK my friend says its been so dry he has hardly had to mow this year. Could the weather be the reason for switch to bi-weeklys? I think any kind of surcharge will PO some. Be competitive and more effiecient and see if you can't do lawn for the market price what ever that is. I mean who ever does a good job at the lowest price usually get the job unless they are undependable, etc, tight economy now with fuel prices taking hunks out of peoples budget they are looking for ways to save. They will cut you before the cable tv. Find out who your being replaced with and deal with the problem (lowballers, partime, etc). Good luck, sounds like you have an open mind. Try to think like a customer. Tax on labor does not exist here.

bullethead
09-13-2006, 03:33 PM
Try charging $10 extra for these little yards on Biweekly schedules. Your client is still saving money but your crews are doing more work. Make it worth your time or forget about it. I think you'll find two benefits - a) those biweekly customers who don't balk at the price will stick around longer and 2) ultimately you will steer more people toward your weekly service. Bueno suerte.

John Gamba
09-13-2006, 03:34 PM
These must be pretty small yards?


Not for that price around here. i remember a time where there was only three people cutting, 1/4 acres for 40 and up:cool2:

tacoma200
09-13-2006, 03:39 PM
Not for that price around here. i remember a time where there was only three people cutting, 1/4 acres for 40 and up:cool2:
Average lawn here is 1/2 acre and about $30 to $40. Too much competition to get any higher prices. The standard of living is lower here than in places like New England, large cities and towns, etc. Average home is just over $100,000 so its just a different market than some places. Your not going to get rich in the rural South. One LCO bid a large comercial that takes about 10 hrs (3 men about 3.5 hrs each on mowers, trimmers) for $250 Thats about $25 per hour hiring the help and keeping up the equipment. I don't see how they make anything. Most bids were for double that. Competition is fierce, I can imagine Florida with the illegal population undercutting LCO's.

John Gamba
09-13-2006, 03:47 PM
[QUOTE=tacoma200]Average lawn here is 1/2 acre and about $30 to $40.

Thats what we are charging now---and we pay more to live.:cry:

MountainMow
09-13-2006, 04:26 PM
Not for that price around here. i remember a time where there was only three people cutting, 1/4 acres for 40 and up:cool2:

I wasnt basing that question simply on the price he listed. DFW area has lots of new subdivisions with "zero lots" , and small lots, where there are a gazillion houses on the same street etc... Im just wondering if hes working a lot in those types of areas.

Frankly though, we have a lot more competition here too. Having said that I'm still planning to raise my prices. Further, I'm not going to take any bimonthly mowing jobs next year. They're a big pain in the butt. They DO expect you to price just as you would a weekly job, eventhough there is more work involved. Still further, if something happens during that 2nd week, and you re unable to get there to mow, you re pushing a month without mowing, and then its 4 times the work, and you wont be able to get there fast enough to suit em.

So, to answer his question, yes, I would stick by the additional charge. If they were decent sized lots, I would even charge more than 5.00 extra. At the same time, I think you need to concentrate on selling a total package. Ferts, edging/bed edging, bed maintenance etc... One of those packages is probably worth four mow and blows in terms of gross revenue, and you save on fuel costs.

lawnspecialties
09-13-2006, 04:32 PM
It's really not the charge, it's the customers. Someone who wants their yard mowed every other week because of weather is just looking to save a buck. No problem. Just look for customers who are looking for a well maintained lawn at a reasonable price; not a cheap price for just a mowed lawn.

John Gamba
09-13-2006, 04:41 PM
So, to answer his question, yes, I would stick by the additional charge. If they were decent sized lots, I would even charge more than 5.00 extra. .


I charge when i did every other week-----the price of the cut plus half the cut. 30 turns into 45:weightlifter:

flam41
09-13-2006, 11:00 PM
bi monthlys are the scum of the earth. we are phasing the last ones out & never taking anymore. Thats right I said never.
Dfw, I've taken a break from here for a bit, all & all are things going ok for you?