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View Full Version : Are commercial accounts so good?


jdlawn
04-19-2007, 01:14 PM
i currently have one commercial account and i make pretty good money from it but i have heard that commercial accounts are the best and then i have heard residential is the way to go. (most are a mix it seems) Just wondering what you perfer. i couldn't say for myself i like it all.

Wells
04-19-2007, 02:43 PM
Personally I prefer the residential accounts.

We've had plenty of commercial accounts in the past (Wal-Marts, Restraunts, Condos, Day-Cares, Office Plazas etc) and while they do pay well it seems like all their interested in is the lowest cost provider so eventually you end up loosing the accounts.

The residential customers seem to be more loyal and will stick with you for years even with the lowballer knocking at their door. Plus replacing the income from (1) lost residential account is much easier then replacing the income from (1) large commercial account.

bohiaa
04-19-2007, 04:58 PM
Money, Money, And Money

prosperity
04-19-2007, 08:05 PM
I prefer commercial accounts myself.

Usually can be done at any time of the day, or weekend if need be -
Can mow wet if need be
Don't have to worry about kids/pets/people being around

Also, pertaining to what Wells said, yes, they are usually bid jobs. But, for me, that makes me all that much more efficient I feel - almost a challenge each time.

haybaler
04-19-2007, 08:30 PM
I'm very surprised at the results. I was expecting at least 75% BOTH. You have to have a mix. you need to have a good base of customers that you know you'll have for the rest of there lives and then bid a little high on a bunch of commercial. There's no reason to lowball commercial bids unless your desperate. There's some commercial places that don't go out to bid, if you can get some of those your lucky. don't go for the chains like Wal-Mart.

DuraCutter
04-20-2007, 12:24 AM
I'm very surprised at the results. I was expecting at least 75% BOTH. You have to have a mix. you need to have a good base of customers that you know you'll have for the rest of there lives and then bid a little high on a bunch of commercial. There's no reason to lowball commercial bids unless your desperate. There's some commercial places that don't go out to bid, if you can get some of those your lucky. don't go for the chains like Wal-Mart.

Most of my commercial is bid, but it's already decided at the outset that I'll get them. Thing is I offer the commercial manager more than the competition. For example, we just did a site, first we swept the parking lot with a Tennant parking lot sweeper, did a real nice job, emptied all the sand and rockchips in their containers...lol, next we did spring cleanup on the lawn area. Used a pull behind power sweeper with an attached motor to power the broom. It does detatching and picks it up at the same time. All we have left to do is paint the parking lines and we're done. 1/2 day for 2 guys. So overall, 2 men did all the parking lot and the spring clean up in a total of 30 manhours total. Cost in labor $600 + 10 hours for line painting. Total $800.
Cost to client(condos)- $2,800. This is typical of commercial/condos. Just did a spring cleanup on a group of commercial bldgs. Used the John deere pull behind sweepers for this one as the grass wasn't that strong. It's crappy grass, one thing I love about commercial, that way it's easier to do spring cleanups. This one was done in 6 manhours. Cost $120 labor. Cost to customer- $1,145. These numbers are NOT exceptions, I could go on for mostly all my spring cleanups and my grass cutting for this coming season.

Commercial pays way more than residential, that's not even a guess or a by golly, it's real life, not just me, but other commercial guys. Not all commercial pays this well, you just have to find the ones that do.

You also need to be very versatile so the manager needs you around. Make it so that you offer so many services they can't afford to lose you. Today, just got go ahead for a condo for interior painting. It's hallways in 2 4 storey condo bldgs and it's a $42k job. We did the decks last year and some landscape work. This year we'll do the painting and more decks. payup

I'm not bragging, just giving some enterprising soul here an insight on how the real serious money is made. It takes time, but with higher profits, you can buy more equipment and offer more services till they can't do without you. You make life simple for them and they give you the work because it eliminates a lot of searching for them. We expanded to parking lot cleaning this spring and we bought used tennant parking lot sweepers at a cost of about $30k. We'll recoup that money this spring and maybe part of next spring. Anyway, this is all without doing residential. I know, residential can also be very good, but commercial is where the big dollars are, unless you're a brickman, but how many of those are there? :)

haybaler
04-20-2007, 07:11 AM
I totally disagree. your account is an exception. Plus I hate painting, I do landscaping. Most commercial accounts go with the lowest bid, period. your not guaranteed the account. then there's the residential accounts that the people are either millionairs or upper class that work all the time and want somebody they can trust and count on for there property and if they like you the'll keep you forever and those are your best accounts. Is this your only account? Don't get me wrong, if your making money great! but look at the other side

nobagger
04-20-2007, 07:29 AM
While both of these are in the same ball field they are two completely different ball games. Yeah every year you do the same thing to gain new clients...solicit work. But like Wells said, every year you have to worry about a lowballer or just a lower bid and every year you seem to have to look over your shoulder to see who's watching for even the slightest mistake doing commercial accounts so they can move in for the "kill". Around here its a very "cut throat" business just like anywhere else I'm sure. But again around here it seems to be more of a soap opera where everyone knows who's doing what property and for what. I try to stay out of that scene but sometimes its hard to do knowing so many guys. Again Wells nailed it with his thoughts and they make all the sense.

bohiaa
04-20-2007, 07:39 AM
I prefer commercial accounts myself.

Usually can be done at any time of the day, or weekend if need be -
Can mow wet if need be
Don't have to worry about kids/pets/people being around

Also, pertaining to what Wells said, yes, they are usually bid jobs. But, for me, that makes me all that much more efficient I feel - almost a challenge each time.

Why Please tell me Why when you show up to do a house the people want to come out and start working in there yard.....

I tell them that mowers and weedeaters throw rocks....

ed2hess
04-20-2007, 06:08 PM
Personally I prefer the residential accounts.

We've had plenty of commercial accounts in the past (Wal-Marts, Restraunts, Condos, Day-Cares, Office Plazas etc) and while they do pay well it seems like all their interested in is the lowest cost provider so eventually you end up loosing the accounts.

The residential customers seem to be more loyal and will stick with you for years even with the lowballer knocking at their door. Plus replacing the income from (1) lost residential account is much easier then replacing the income from (1) large commercial account.
In our area there is a little prestige to getting and holding key commercial properties like popular restaurants and hotel the have flowers, rye grass in the winter and just want to look nice. It is a good feeling when you drive by the property in the evening and see how nice it looks and when you tell people you mow such and such they say oh yes it always looks nice. It hurts a lot when you lose a $10K property but that is what drives us every day to be sure we don't lose them...

causalitist
04-26-2007, 02:06 PM
Why Please tell me Why when you show up to do a house the people want to come out and start working in there yard.....

I tell them that mowers and weedeaters throw rocks....

hahaha I know! i hate that crap. almost half of my new customers this year come outside and stand 3 feet away staring at the weedeater while im using it.

then yesterday this 2 year old is running around in the driveway and the chute is facing that way when i turn; so i just kill the blades and stare at the lady.
cmon people. lol

topsites
04-26-2007, 02:13 PM
Strictly residential for me, as a solo operator I find I don't have the resources to carry the bigger units...
To me, if it takes up more than 5 percent or so of the company's resources, it's a bit too big to chew, I found out.

The other part I find frustrating is having 100 owners vs. 1... Association-owned properties to me are the worst nightmare, thou most are pretty nice, all it takes is 1 or 3 to make the whole deal turn sour. I think it would be ok if I was employee-minded, I'd have no problem with it but as an owner I just can't take it. Contract or not, all it takes is 1 out of those 100 to be one of those folks who enjoy finding loopholes, as just one example.

For me it would be all about the free advertising, but even that I find hard to justify in the ways of all the extra I have to put in. So I'll take on a commercial property if it's owner-operated, such as a small franchise perhaps, or a small complex but again it has to be owned by one individual and not no inc's or hoa's. Guess to each their own, my hat is off to those who enjoy and tackle commercial props in a profitable manner, I envy that skill.

DuraCutter
04-26-2007, 10:52 PM
Strictly residential for me, as a solo operator I find I don't have the resources to carry the bigger units...
To me, if it takes up more than 5 percent or so of the company's resources, it's a bit too big to chew, I found out.

The other part I find frustrating is having 100 owners vs. 1... Association-owned properties to me are the worst nightmare, thou most are pretty nice, all it takes is 1 or 3 to make the whole deal turn sour. I think it would be ok if I was employee-minded, I'd have no problem with it but as an owner I just can't take it. Contract or not, all it takes is 1 out of those 100 to be one of those folks who enjoy finding loopholes, as just one example.

For me it would be all about the free advertising, but even that I find hard to justify in the ways of all the extra I have to put in. So I'll take on a commercial property if it's owner-operated, such as a small franchise perhaps, or a small complex but again it has to be owned by one individual and not no inc's or hoa's. Guess to each their own, my hat is off to those who enjoy and tackle commercial props in a profitable manner, I envy that skill.

You're right Topsites, to do condos or commercial you need to have employees so you don't have the dreaded bitching right at you. How I handle the bitching depends on what it's about. Mostly, you can defuse the situation by negotiating with the management company. I WON'T work for a condo that is self managed. They have to be managed by a professional management co. or forget about it. I find the manager is the arbitrator if any problems arise and it makes it easier. If you do all this, condos/commercial in general bring in double or triple the profit...if you have the right set up to tolerate the bitches...:laugh: :laugh: :laugh:

TNT LawnCare Inc.
04-27-2007, 09:30 AM
Were mostly residential probably 80% i'd guess most of the commercial accounts here always go to the lowest bidder. Last week i bid a 2 acre commercial site at $100 a visit cut trim and blow. It went for $80. No biggie ,this week i picked up 4 clients on one block at $45 a piece maybe there 2 hours or less,thats why i like residentials.

MOWEMJEFF
04-27-2007, 10:31 AM
Right now I only have 2 commercial and one is my grandmothers hairdresser $45 for half hour(always has cold water and normally a $5 tip...gotta love those) but I say leave the big bidding jobs for the big guys. It would take so long for a small guy like me to turn a profit with the equipment needed to do some bigger jobs and you still want equipment to fall back on. And when I used to run a crew for a LCO I dealt several self managed condos and the guys were great. So I wouldn't rule them out it all comes down to the individual you deal with, whether theyre down to earth or a big PITA, that's why I love the rich old ladies and hate the grumpy old men.

GSPHUNTER
04-27-2007, 10:55 AM
I'm fairly new to the game, but when I drive around I don't see any of the larger co's doing residential work. They nail down the big contracts that pay top dollar.

People can't do this in a short amount of time, but give it 10 years and it's a possibility.

I do all res work right now, but have my sights set on a few commercials for next season already. As I need to expand, I will and keep getting new/bigger equipment until I can tackle most jobs.

topsites
04-27-2007, 11:40 AM
I WON'T work for a condo that is self managed. They have to be managed by a professional management co. or forget about it. I find the manager is the arbitrator if any problems arise and it makes it easier. If you do all this, condos/commercial in general bring in double or triple the profit...if you have the right set up to tolerate the bitches...:laugh: :laugh: :laugh:

That's interesting, the one I worked for was self-managed by the association of tenants... Based on what you just said, I might consider a one-lot deal that comes under a management company, but I am also thinking by that time it will be a HUGE lot (or more like a dozen service stations or something along those lines).

Yeah, it was tough, I just felt so treated like I was their little lawn boy, here Johnny boy, come hither and now. The worst was the non-tenant who just had to come over running off at the mouth, more than once I about grabbed one by the throat :laugh: but in the spirit of things I just ignored them for the most part (which didn't help). All I can say is I am thankful for spam filters, I never saw a one email thou I'm almost sure several might've been sent... A somewhat thick skin and the fact it was my 5th year helped considerably, I still took it like a man but had it come along 2-3 years earlier, I don't know what would've happened.

In the end I did about twice the work I bargained for, so I squeaked out of there at around $30 pmh, it was like working for minimum wage all over again. Every time I had to go service that lot, it would take 1-2 hours before I could talk myself into just getting out of bed, no joke lol, then another 2-3 before I got a move on :laugh: Once I got to working it wasn't so bad, but still.

And it was a small 100 or so office complex, we're talking around 3 acres total land but most of it parking lot and buildings so only 1/2 acre or so of actual turf... The curbs killed me thou, and the sprawl and spread of it all, it only looked small when compared to other commercial properties, I almost felt like it would be easier to drive the apparently small distances than ride the mower :laugh:

It used to take me an absolute minimum of 3 hours to just cut and trim that 1/2 acre or so of actual turf, perhaps it helps to reason it was spread out among a dozen or so islands and sections, man those curbs.

It's all good thou, I didn't quite make it through the season but it was very educational :laugh:

eddings
04-27-2007, 11:53 AM
My father in law got me what I thought was a small commercial account. Three different properties. One takes 5 min and they pay $25. The next takes 15 min and they pay $50. The next took two hours of weedeating by myself and about 15min on a mower, that one only payed $100. The first two were great, but two hours on the weedeater almost killed my back.

He also wants the bushes trimmed once a month for that price. I was thinking of charging a flat $250/cut for all three, and that would include the bushes once a month.

My problem is I will need to invest in one more Weedeater and a gas power hedge trimmer, which I don't have. I think I would rather just pick up 4-5 res. lots instead.

What do you guys think?

Black-Rob
04-30-2007, 07:30 PM
I have just started my lawn service this year. I have a mentor that told me that commercial is the way to go. You obously have to have the equipment though. And most big paying bids require experiance and referances. As well as insurance and workmans comp. So get right before considering them.

Next year I have the inside track for an apartment complex that is 17 acers but only about half is grass that will pay $750 per week for cut-trim-blow. Right now I couldn't do it if I wanted to cause I only have a 40" Toro walkbehind. But when the contract is signed next year, the appt. manager is a cousin, I will finance a 62" Toro ZTR that will get the job done along with my current WB in about 4 hours of cutting and 2-2.5 hours of trim-blow. Even if is is 7 hours total, that is $750 for 8 acers. With me and another guy part time, easy for me to find, $70 in labor at $10 an hour, figure $30 in gas for the equipment, that leaves $650 a week for the company (ME)!! And that is one job taking up a little more that half the day. SIGN ME UP!! I'm just pissed I didn't have my stuff together this year to get it. I won't be able to pocket too much of it cause I plan to pay that 62" off before the season is up but I will go into the next year with bigger equipment to take on big jobs like this one with no overhead! Not to mention if I win more bids with the local housing department and other things like that.

Basically, sometime you don't work for the money, but for the equipment in order to expand your job size in the future. Kind of like investing in the future.

My mentor just won the bid to for a major utility company's substations which is over $300,000 over 4 years!!!!

You tell me which one is better.

The only risk I can see, of course is a big risk, is if one of the big mowers breaks down really bad. But I will have warrenty on both, the only advantage of buying new, so maybe it ain't all that risky.

haybaler
04-30-2007, 09:26 PM
make sure the dealer you by it from is willing to give you a loaner mower the same size or take parts of a new mower to fix yours. if something brakes (it will) it can be in the shop for 3 weeks.

ed2hess
04-30-2007, 09:56 PM
I have just started my lawn service this year. I have a mentor that told me that commercial is the way to go. You obously have to have the equipment though. And most big paying bids require experiance and referances. As well as insurance and workmans comp. So get right before considering them.

Next year I have the inside track for an apartment complex that is 17 acers but only about half is grass that will pay $750 per week for cut-trim-blow. Right now I couldn't do it if I wanted to cause I only have a 40" Toro walkbehind. But when the contract is signed next year, the appt. manager is a cousin, I will finance a 62" Toro ZTR that will get the job done along with my current WB in about 4 hours of cutting and 2-2.5 hours of trim-blow. Even if is is 7 hours total, that is $750 for 8 acers. With me and another guy part time, easy for me to find, $70 in labor at $10 an hour, figure $30 in gas for the equipment, that leaves $650 a week for the company (ME)!! And that is one job taking up a little more that half the day. SIGN ME UP!! I'm just pissed I didn't have my stuff together this year to get it. I won't be able to pocket too much of it cause I plan to pay that 62" off before the season is up but I will go into the next year with bigger equipment to take on big jobs like this one with no overhead! Not to mention if I win more bids with the local housing department and other things like that.

Basically, sometime you don't work for the money, but for the equipment in order to expand your job size in the future. Kind of like investing in the future.

My mentor just won the bid to for a major utility company's substations which is over $300,000 over 4 years!!!!

You tell me which one is better.

The only risk I can see, of course is a big risk, is if one of the big mowers breaks down really bad. But I will have warrenty on both, the only advantage of buying new, so maybe it ain't all that risky.
One potential down side is.....cousin leaves or the accountant notices that it was not bid propertly. But nice to get those inside jobs I can assure you that the normal bidding price is a LOT less per hour than this job and that is why most people stay in residential.