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grass pro llc
03-25-2009, 11:03 AM
I bought a small lawn care company in the fall of last year. Along with it I got 20 residential accounts. Some of these accounts are only paying $10 or $15 per weekly cut. What is the best way to explain to the customers that I need to raise the price. I'm just starting out so I really don't want to pi$$ any of them off and lose them. Thanks.

ALC-GregH
03-25-2009, 11:11 AM
Have you even talked to them? You should have thought of this before you bought out someone's company. You might lose most if you try it. Are you relying on the 20 to get started? At those prices, I hope you didn't pay much if anything for them. Sorry to say....

grass pro llc
03-25-2009, 12:33 PM
Have you even talked to them? You should have thought of this before you bought out someone's company. You might lose most if you try it. Are you relying on the 20 to get started? At those prices, I hope you didn't pay much if anything for them. Sorry to say....

I have a full time job and lawn care will be part time. I think 20 is a good start, I always have room to grow.

topsites
03-25-2009, 12:46 PM
Yeah...
Kind of a tricky situation there, not sure exactly.

Kennedy Landscaping
03-25-2009, 12:49 PM
I agree, just see if you can get by this year, and then maybe try to bump it up a little. The other guy may have quit because he was losing his butt.

lifetree
03-25-2009, 11:10 PM
I agree, just see if you can get by this year, and then maybe try to bump it up a little. The other guy may have quit because he was losing his butt.

I disagree, if you can get a little bump this year so you can at least break even, then go for it ... otherwise, you'll lose money like the other guy and get of it like he did !!

ambersLawnmowing
03-26-2009, 01:29 AM
I bought a small lawn care company in the fall of last year. Along with it I got 20 residential accounts. Some of these accounts are only paying $10 or $15 per weekly cut. What is the best way to explain to the customers that I need to raise the price. I'm just starting out so I really don't want to pi$$ any of them off and lose them. Thanks.

I can understand losing the customers, fine but howabout losing your pants. $10 or $15, there isnt a way that you can honestly make money or even break even on that.. What i would do is send them a letter, say hey listen, rates will be increased this year to adjust for the market, let them know that you want to keep them as customers so you feel bad about raising prices, but it has to be done. Also give them something extra, not a free mowing edge there sidewalk, trim a bush, ect something extra. but let them know you are doing that. Any fool that dosnt understand this year prices have gone up every where isnt worth having. It will seperate the good from the bad/weak customers... From the $10-15 raise them all around to an equal $20 and they will still be getting a deal, they may shop around but wont find anything under that.. Best of luck to you.

Lawnut101
03-26-2009, 01:37 AM
I can understand losing the customers, fine but howabout losing your pants. $10 or $15, there isnt a way that you can honestly make money or even break even on that.. What i would do is send them a letter, say hey listen, rates will be increased this year to adjust for the market, let them know that you want to keep them as customers so you feel bad about raising prices, but it has to be done. Also give them something extra, not a free mowing edge there sidewalk, trim a bush, ect something extra. but let them know you are doing that. Any fool that dosnt understand this year prices have gone up every where isnt worth having. It will seperate the good from the bad/weak customers... From the $10-15 raise them all around to an equal $20 and they will still be getting a deal, they may shop around but wont find anything under that.. Best of luck to you.

I think that this is a good suggestion. Chances are you may lose a few customers, but at the same time, tell them you will do a great job, and customer satisfaction is your number 1 goal.

topsites
03-26-2009, 04:29 AM
One other option, and it's still not pretty but believe me this does work...
Is ask each customer individually if they would be willing to pay you $5 more per service.
And I mean ask each and every one, even the top dollar paying ones, well...
So long you can keep a straight face without having to try but so hard, otherwise not those.

And leave it entirely up to them, but before you ask you have to be prepared to
continue servicing their property at the current rate, like should they say no.
Which, some will.

Now some won't give you a straight answer, you'll have to read them.
Like if they are reluctant or hesitant, that would more than likely be a no.
It's only good if they're happy to do it, most of them who want to pay more will be upfront about that.

What I'm trying to say is, you need a sound, emphatic YES out of a customer, otherwise it probably means no.
I think you get my drift...

Now some, maybe most, I don't know, they won't go for it.
But some will, gladly at that, and it's not much but it does help.

If only 2 out of the whole lot go for it, that's an extra $10 a week.
Never knock free money.

John from Mass
03-26-2009, 05:24 AM
I have had a similar situation, and have been holding the price ASSUMING they need other services, fertilize, grub control(big here) trimming shrubs, de=thatching, aerating, ETC...oh and now I am cleaning gutters...

I have never viewed cutting as the end game; just the "door opener"..

As this client base and their trust in you build, you can also hold the price if they get you a new client.

Just my take anyway...

John from mass

DaughtryLC
03-26-2009, 05:37 AM
I found that going up was harder on me than the costumers.
In other words, I worried more about it than they did!!

maintenanceman
03-26-2009, 06:43 AM
Talk with your customers, raise their prices, and start looking for new customers to make up for some that you may loose.

Richard Martin
03-26-2009, 08:59 AM
I can understand losing the customers, fine but howabout losing your pants. $10 or $15, there isnt a way that you can honestly make money or even break even on that.. What i would do is send them a letter, say hey listen, rates will be increased this year to adjust for the market, let them know that you want to keep them as customers so you feel bad about raising prices, but it has to be done. Also give them something extra, not a free mowing edge there sidewalk, trim a bush, ect something extra. but let them know you are doing that. Any fool that dosnt understand this year prices have gone up every where isnt worth having. It will seperate the good from the bad/weak customers... From the $10-15 raise them all around to an equal $20 and they will still be getting a deal, they may shop around but wont find anything under that.. Best of luck to you.

I agree. This is good advice.

Let me also point out that I seriously hope you didn't pay anything for these accounts. You could have passed out enough flyers in a few days to easily get 5 or 10 good paying accounts.

Allens LawnCare
03-26-2009, 09:23 AM
I bought a small lawn care company in the fall of last year. Along with it I got 20 residential accounts. Some of these accounts are only paying $10 or $15 per weekly cut. What is the best way to explain to the customers that I need to raise the price. I'm just starting out so I really don't want to pi$$ any of them off and lose them. Thanks.

At those rates you would have to work free for one week per month...that weeks pay would go towards gas, maint....etc

Allens LawnCare
03-26-2009, 09:25 AM
Talk with your customers, raise their prices, and start looking for new customers to make up for some that you may loose.

Tell them the reason you have the accounts is the person you bought them from went out of business.......Wanna guess why!

kaferhaus
03-26-2009, 09:38 AM
Buying these accounts was a mistake as I'm sure you've already determined. I'd take the advise of the guy that said to just level with them. The previous guy was losing his shirt and had to get out of the business. You'd love to keep them as a customer but you can't suffer the same fate as the last guy.... you're talking about 20 accounts that are only going to gross you $400 at the most!!

If you haven't been convinced yet, your bank account will shortly convince you that this is a losing proposition.

You could sit home on your butt and not lose a penny. And the "hoping" for extra services to make up for it is a pipe dream... to be successful in business you need to be profitable on your core business which is cutting grass. Everything else is gravy.

grass pro llc
03-26-2009, 10:02 AM
Hey thanks for all the advice, as I said I'm new to the business and this site has given me tons of great information.

traman
03-26-2009, 10:59 AM
i agree with most of the post. but look at the big picture,lets say they all pay 15 @ 20 accounts = 300. raise the rates to $30 per cut where you should be more or less.even if you lose half of the accounts you now make the same money and are only doing half the work. then build from there. work smart not hard.

Sweet Tater
03-26-2009, 11:39 AM
I bought a small lawn care company in the fall of last year. Along with it I got 20 residential accounts. Some of these accounts are only paying $10 or $15 per weekly cut. What is the best way to explain to the customers that I need to raise the price. I'm just starting out so I really don't want to pi$$ any of them off and lose them. Thanks.

Oh My, 10-15 dollars, thats what I charged when I was 13 and tring to make summer money 30 years ago.
IMO you have more than like got to raise your price, however you will probably loose most of those. Sit down with these folks and explain to them the situation, maybe encourage them to price shop so they know that they are being way under charged, but to help maintain those accounts tell them you will match the best price they get, or something like that. thats a sticky wicket your got there

GracesLandscaping
03-26-2009, 12:22 PM
i think the only way your gonna make money on a lawn that cheap is if they are "garden homes" and you have at least 5 on the street that way you can unload equipment once knock them out in an hour or so and be on your way. especially with a year like were having its gonna be very hard to raise the price BUT i doubt they will find anyone to do it cheaper than if you raised it 5 dollars or so. But go look at the properties and see if the job the previous cutter was doing was good, or just half @$$ and if you can do better, tell them you have to raise the price because the quality of work you do is way better than the previous guys, and you know things are tough this year which is why your only raising it X amount of dollars. make it seem like such a small price to pay for the work they will be getting. you have to sort of bring them into your mindset and if any of them care about their lawn and arent the type to just say "aw cut er down good and short so she wont need it for a few weeks" they will understand and happily pay you the extra. Good luck with your business!!!!

GracesLandscaping
03-26-2009, 12:24 PM
also you might want to explain to them that the guy you bought the business from sold it because he wasn't making any money and wasn't smart enough to price accordingly

ambersLawnmowing
03-26-2009, 01:35 PM
i think the only way your gonna make money on a lawn that cheap is if they are "garden homes" and you have at least 5 on the street that way you can unload equipment once knock them out in an hour or so and be on your way. !!!


He could have the entire block and still lose money. $10-15 lawns and you have 5 that comes to $50 for an hours worth of work? He needs to raise his prices.

GracesLandscaping
03-26-2009, 02:24 PM
He could have the entire block and still lose money. $10-15 lawns and you have 5 that comes to $50 for an hours worth of work? He needs to raise his prices.

im not sure of the area, but around here your doing pretty darn good to get 50 an hour. plus you can do it all in one stop so its very efficient. but it all depends on cost of living in your area... my area is low cost of living, but if i went an hour south to nashville 50 an hour would probably be extremely fair pricing for the customers, and not me.

lawnkingforever
03-26-2009, 05:26 PM
You can do one of 2 things. Raise them all to market price right now with no exceptions and expect to lose some of them. This way you would have some good paying customers to start the year off. Or cultivate them, raise them just a few dollars each (and don't worry about 20$ or 25$) charge 18$ or 23$ whatever you feel their threshold is. Suck it up and make a little coin this year and prove yourself as reliable to these customers. Then next year you can raise them all to market value and you will keep most if not all of them.