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Barefoot Landscaping
01-05-2002, 02:41 PM
I need help....I just joined this forum a couple days ago to meet new business contacts and to get some help, but all I see are people complaining about lowballers and such. Being a new busineww owner, how do I build a customer base without lowballing and making other companies mad. I have been to college at Clemson University and York Technical College for horticulture, landscape design, etc, etc....and I carry all the insurance and licenses that I am required too....I am very confused right now and could use some feedback. I want to succeed in my business, but I am starting to become afraid of some of the things that are being said on this forum. Thank you in advance.

Lawn Dog2001
01-05-2002, 02:58 PM
Set your prices however you want to and dont worry about what anyone says about it. Everyone has an opinion, that dosn't mean every opinion is correct.

If I priced my lawns as high as some of the people here I would lose half of my accounts. Some people have astronomical prices. Then every time they lose an account they cry lowballer! Its no good to be a HIGHBALLER either.

Everyones area is different. Some can get a higher rate for there services. Some cannot. The best thing for you to do is figure out what your areas going rate is. A $25 minimum is a good place to start.

Good luck to you in you business.

odin
01-05-2002, 03:10 PM
I agree with lawndog 2001 dont worry what other guys think
Here where im at rates very from village to village
One village might have millionaires the other might have upper middle class and one might have working class and some have a combination .We target the upper neigborhoods but still have a fair percentage of people who are willing to pay good but dont what the extras like aeration overseeding and fertilizeing.

Guardian
01-05-2002, 03:14 PM
No direct competitor is going to be "happy" with your success -BUT is very possible to start/grow a business without ticking everyone off. If you research your market and determine what rates people pay for the services you plan to offer, then you can compete without lowballing. If a neighborhood goes for $35/cut, you can offer the same general price, but maybe with an initial discount ( % off first visit, to demo yourself) Most of us just don't want to see you offer $20/cut and therefore lower the value of what we can all make in that area. Your goal, after all is to offer "as good 0r Better" service, so YOU should at least earn the "going rate".

Commercially, you need to begin a relationship with a property management company. Find out how to get on their "Contractor list" so you can be invited to bid on upcoming properties. Again, find out what those kind of properties go for and bid within that range. Dont fool yourself into believing you can do a $2000/mo Condo for $1200. You can't - and the property Mgr knows you can't. They will view you as a company with LITTLE experience in bidding & servicing big jobs.

Flyers, "cold calling" small business (Suit up and be your own Sales Rep), and "small" yellow page ads all work.

Good Luck

lawncare
01-05-2002, 03:16 PM
Different people have different terms when it comes to whose a lowballer as such my meaning is someone who underbids me on a job. And when i ride by to see the quality its not as good as mines ive been doing this for about 15 years and i will lowball someone if i think i can do a better job then what i see and raise the price on something else i may do for them if they like the quality of my work. As for price setting me myself i start my price at 40 bucks but if someone calls or ask for a quote i negotiate because if i can i wont turn down any money because that 1 cust may lead you to something bigger i know that from xperience no matter what you see in hear no 1 pays your bills but you and if that mean being call a lowballer so let it be. xperience is the best teacher. do a search on the topics you not sure on and u will learn a lot.

Twotoros
01-05-2002, 03:17 PM
If you are paying all personal and business taxes plus your business expenses you get to take home 30% if you are lucky. Do you want 30% of 25.00 or of 30. or of 35.$? Do you want to work 40 hours for 400.00 take home or would you prefer 50 hours for 425. or perhaps 60 hours for 500.?
Do you want to replace worn out equiptment in two - three years or fold because you can't afford it?

That's the way I see it but I could be wrong.

Lanelle
01-05-2002, 03:27 PM
One of the reasons you see complaining here is because this is a safe place to do it. Guys from all over the country can cry in their beer together without too much fear of local reprocussions that would affect their business. This is a better place to do it than say with your equipment dealer who might be selling to the exact people that are lowballing you. So, take the complaining here with a grain of salt. Yes there are valid points being made but if you met most of the members 'on the street' I doubt that it would be a negative conversation. Keep reading and you'll find that most members love what they do and by March they are eager to get back outdoors again.
Welcome to Lawnsite.

Shady Brook
01-05-2002, 03:28 PM
I agree with the previous posts.

You can only charge what the market will bare. You need to find out what the going rate is in that area. You may be able to charge a bit more by offering special attributes. In the begining, it is always the temptation to undercut to get business. If you feel that you must go lower to attract customers, you have to do what you have to. There are ramifications in doing this though. You can end up with a type of adverse selection, where you get those who do not care about quality, and will go with the cheapest regardless. These are usually the customers that you do not what as they will probably dump you for a cheaper guy, and they are probably the type who will not want the extra services like aerations, landscape work and such. They usually are the ones most likely to complain in my experience.

I think many are do not care for the lowballer because of their threat to bring down the going rate prices. That is probably what you see from most speaking against low ballers. I know guys who charge 25 to 30 percent less per lawn then I do on the same type yards, and I myself may be a bit lower then going rate. These guys pick up a lot of lawns in a hurry, but I can predict that most if not all will go out of business in the next couple years. What is the result? Those folks will be looking for lawn companies, and expecting to pay $15 for a $25 lawn. It can be a vicious cycle.

Try to get customers who are willing to pay for quality. Sell them on quality, and produce it. Have good comunication with them, make them think of you as a friend, not the lawn guy. They will not likely leave you for the guy who is $5 less, because they know you and care about you. You will probably care for them, and the returns will be refferals of gold.

Do what you have to do, but treat your customers like gold and you will have good customers.

Jay

KDJ
01-05-2002, 03:43 PM
I have been reading this board for a short time and find there is a lot of good information here, also a lot of BS.
It's always a lowballer's fault when they make a bad call and if you cross them they will tell you what a big state wide business they have........... so on and so on.
Remember your on the net and may be talking to a 12yr old for business advice LOL!!!! Most people of high business achievement will not hangout on this board for hours at a time.

If you are starting out I would say to lowball the first 20-30 people you get. These people you will not have a year from now.
Once you have done that start looking for better yards that pay more. (ok) Then when you have too many yards to keep up with drop the low priced ones while replacing them with better paying ones. If you do that over and over you will have the best yards in town.$$$$$$ Always do the best work you can do and never leave grass in the street.

PS. use your commonsense, thats the best advice I can give.

bobbygedd
01-05-2002, 04:53 PM
you mean, u r NOT SUPPOSED TO leave clumps of grass in the street? ughhh, no wonder my customers hate me.

Barefoot Landscaping
01-05-2002, 05:06 PM
I would like to thank everyone that replied to this. There is so much information on this forum that is very useful. Thank you again....

kris
01-05-2002, 06:08 PM
One other thing...don't work barefoot! Safety First!

Really...Welcome to LawnSite.com

Ric
01-05-2002, 07:51 PM
Thomas

Use you education to produce quaility work at a fair price. Your education will leave the competition in the dust. Sell the idea that because you have a education your design work will still be good after 5 years of growth and that you only install plants in areas that will surive. 90% of the people in the industry can tell you the part number on every grease fitting on there equipment. But can't tell you what the name of plants is they are trimming let alone its needs or growth habits.

gogetter
01-05-2002, 10:11 PM
Originally posted by Barefoot Landscaping
Being a new busineww owner, how do I build a customer base without lowballing and making other companies mad.

Thomas & KDJ, I'm not sure why you feel you would need to "lowball" in order to build a customer base?

I just started last spring, and I probably was quoting prices that were HIGHER then the big compaines that have been around for a while.
This is hard, hot work, I want to be paid well for what I'm doing. And even in my area, where there is a truck & trailer at every intersection, I feel there is plenty of work out there for all of us without having to "lowball" each other.


Lawn Dog wrote: "Some people have astronomical prices. Then every time they lose an account they cry lowballer! Its no good to be a HIGHBALLER either".

When you take what the average hourly rate works out to be for most of the guys on here, and compare that to what mechanics, plumbers, electricians, locksmiths, etc. make, we are ALL underpaid!!
I just contacted a "handyman" out of the paper to put up a ceiling fan for me. He told me he bills at $75 an hour. This is about what the other contractors I mentioned above are billing at too.
Had a locksmith get a broken key out of a door once, charged me $81 for about 10 minutes of work.
The national average for a landscaper is $35/hr. So I disagree with you Lawn Dog, I think if anything, we are underpaid and not charging enough.

TSS
01-05-2002, 10:29 PM
Barefoot...just price a few of your accounts and after once you begin working these accounts you will know if your prices are low. Just look at the amount of work you are doing to the amount of profit you are recieving and you will know if you need to raise your prices. When I first started I thought that some business was better than no business. Quicky found out that my thinking was wrong. Good Luck!!

KDJ
01-06-2002, 01:27 AM
[QUOTE]Originally posted by gogetter
[B]

Thomas & KDJ, I'm not sure why you feel you would need to "lowball" in order to build a customer base?


I suggested lowballing on a limited bases. (first 20-30)

The reason one would do this is for CASHFLOW

Sure one should get top dollar, but when your in this business and starting out you still have bills to pay. So if you make 25.00 per cut instead of 35.00 you have a better chance to make a few bucks to help in the beginning. Just makes sense.

gogetter
01-06-2002, 02:08 AM
Originally posted by KDJ
[B Just makes sense. [/B]

Not to me. You say do MORE lawns at a LOWER price to make X amount of dollars. I say do LESS lawns at a HIGHER price to make the same amount of dollars.

Say he wants to earn $300 per day. He can do 10 lawns a day at $30 a lawn, or he can do 15 lawns a day at $20 a lawn.
In a 5 day work week, that's a difference of doing 50 lawns or doing 75 lawns!!!! Holy crap! 25 extra lawns to make the same money.
I'd much rather do 50 lawns a week then 75 for the same money!!

It's been said here a hundred times: Work smarter, not harder.

Yeah, he's going to get turned down more when he quotes the higher price. So he may have to hand out more flyers.

Like I said, I just started last spring, and I quoted my very first lawn too low because I was nervous and didn't want to be turned down on my first lawn. Although she was a very sweet old lady, I hated going there each week because I realized I underpriced and was practically doing it for free.
That was one lawn. I can't imagine going to 20 or 30 lawns every week knowing I underpriced them and wasn't really making a profit on them.
Just my thoughts. Take care!

David Haggerty
01-06-2002, 06:39 AM
I looked at a franchise once called Barefoot Lawn. You're not buying a franchise are you? I couldn't recommend it if you were considering it.
The business end of lawncare is the toughest for me. I hope you took some business classes to go with all that horticulture.

This forum is like the lawn guys' break room. I think honesty prevails here, but trying to apply the info to your situation can be a bit of a challenge. But you can find out things here you can't find anywhere else.

You already know more about lawncare than me. You'll be fine. I'm like the guy Ric was talking about. I'm more of an equipment operator than a lawn technician. More power! More power!
Equipment junkies RULE!! LOL

But seriously, best wishes on your new venture.

Dave

Lawn Dog2001
01-06-2002, 09:24 AM
Originally posted by gogetter


Lawn Dog wrote: "Some people have astronomical prices. Then every time they lose an account they cry lowballer! Its no good to be a HIGHBALLER either".

When you take what the average hourly rate works out to be for most of the guys on here, and compare that to what mechanics, plumbers, electricians, locksmiths, etc. make, we are ALL underpaid!!
I just contacted a "handyman" out of the paper to put up a ceiling fan for me. He told me he bills at $75 an hour. This is about what the other contractors I mentioned above are billing at too.
Had a locksmith get a broken key out of a door once, charged me $81 for about 10 minutes of work.
The national average for a landscaper is $35/hr. So I disagree with you Lawn Dog, I think if anything, we are underpaid and not charging enough.

A lot of my lawns are under 5000 sqft. I dont consider $20 or $25 lowballing for them in the least bit. Most lawns are generally in the same area and we will knock out 3 to 4 lawns in one hour. Thats between $75 and $100 an hour gross. Is this not enough. I make a good living. I have all my numbers and INS. for liability and pesticide use.

You have to go by your area. In my area I am somewhat expensive. Most of the bigger compaines than mine, in my area, are less expensive. I took an account off the biggest company I know of this year, I was $5 more expensive. You cant just say $35 minimum and expect to build a customer base.

You can not start out highballing. If you price your services to expensive in the begining, word will spread that you are expensive. You have to be reasonable with people at first. As people see the quality of work you provide, over a period of time, then you can begin to slowly raise prices.

I will say this. I only charge $20 for the absolute smallest of lawns. I am not trying to say $20 is a good minimum to have. But I do think $25 for small lawns is fair to both myself and the customer.

HOMER
01-06-2002, 09:43 AM
Sounds like with the education you have your smarter than most of us on here. Go out and get some work.........figure what your making per hour, then you'll know where you stand. I might even go as far as working for somebody else for a year so you'll understand your market better. If you've already purchased equipment then you need to get after it..........quit worrying about the others that say this and that.........it's your life, your business, your money. Live it, work it and spend it how you see fit.

Equipguy
01-06-2002, 11:24 AM
Couldn't agree more with what Homer just said. It's YOUR business, time and money. Develop a plan and work it. Opinions are like belly buttons, everyones got um.

KDJ
01-06-2002, 11:55 AM
[QUOTE]Originally posted by gogetter
[B]
I can't imagine going to 20 or 30 lawns every week knowing I underpriced them and wasn't really making a profit on them.




The 20-30 was for rapid start up and not intended for long term. Just as I posted.



Replacing lawns were better than not having them.

gogetter
01-06-2002, 07:15 PM
Originally posted by Equipguy
[B]Opinions are like belly buttons, everyones got um.

Well, if we aren't going to exchange opinions, thoughts and ideas, what the hell are we even doing here?

Atlantic Lawn
01-06-2002, 07:40 PM
If you have the right credentials going to work for a large design and landscape biz could be a better starting point.Like I've said before learning while getting paid is a good thing.You could also develope a small client list you can do on weekends or after work if you need more money.

crs
01-06-2002, 07:47 PM
A M E N !!!!!!

I think Homer hit it on the head.

fshrdan
01-06-2002, 09:00 PM
I'd agree w/ Atlantic Lawn and Homer's suggestion. I got a B.S. in Hort and soil science, and if I tried to start my own thing on that little piece of paper alone, I would have found myself ill-prepared. Alot of technical knowledge with very little hands-on.

I worked for a lawn care company (chemical) for a couple months, and then with a small landscaping company for a year. All this time I was learning and making mental files of things that would prove useful. The most valuable info will be regional pricing, but also you'll learn about how to schedule, handle customers, handle employees, and you'll probably get to handle a wider range of equipment. This way you'll have preferences for certain equipment and won't buy blindly, and you'll have a loose model of how to run your own business.

I still have a good relationship with my old employer. Matter of fact, he needed to dump some customers in a certain part of town, and he gave me all the accounts for free. Having a good mentor can be invaluable. Good luck with your new business.