Sub Contracting

[heygrassman]

What % are you guys paying on mowing jobs that you are subbing out?

jf

[rodfather]

I'm one greedy s.o.b. I don't subcontract out to anyone when it comes to mowing.

snow plowing, yes...lawn mowing, nope. We find a way to get it done.

[smburgess]

I don't sub out what I can do!

[OBRYANMAINT]

generally speaking I don't know that there is enough margin there to pay a sub to mow

[ChicagoLawn]

In regard to sub-contracting.......... as of 3/15/02, my company sub-contracts all grounds maintenance service(Includes clean up(s), weekly lawn cutting, gutter cleaning, aeration, etc.). My benchmark is to retain 30% as a minimum on these services. The attraction to the sub-contractor is a timely payout of net 10 days on a "weekly" invoice of services complete, efficient routes and the ability to lease my 16' Wells Cargo Trailer maintenance rigs complete with all necessary equipment to complete work and of course appropriate signage on trailer to attract new customers in my(general contractor) name.

All sub-contractors go through a series of steps in becoming a "Independent Contractor" of my company. Of course, a non-compete is a important clause in the agreement both parties sign but even more critical is the system in which you operate. If you want to retain a "high caliber" independent contractor the "deal" must be - WIN/WIN!

I see it as all of my services can be subbed out to Independent Contractors exactly how we arrange with snow and ice management services. My company will be a 100% "General Contractor" of all Landscape and Snow Management Services by 12/1/02.

Lets keep this thread going with some factual feedback.

Joe

[OBRYANMAINT]

I am interested in learning more about subbing out lawn services

[Albemarle Lawn]

Hope it doesn't blow too hard up in the windy city!!!

What happens when the subs screw up and don't care because they find greener pastures and your work is put on the "back burner."

I think you are ok as long as the economy sucks, but when things pick up your subs will check out.

K.B.

[ChicagoLawn]

Albemarle Lawn,

Based on your response, it sounds as if you are unsure??? of yourself, marketing and of course your business operating system.

Explain "house of cards"/Independent Contractors in comparison to a staff of employees?

To answer your question "What do you do when subs screw up", the same any caring company would do.........RESOLVE THE PROBLEM and of course fine tune your operating system to be certain that the same problem will never arise again.

What will you do when your long time employee(s) (if you have any at all) tell you that you have not or simply can't afford to pay them enough per PRODUCTION/HOUR?????? to retain their service. Can you still compete? Can you survive without them? Talk about being un-prepared in a good economy or in your words "bad economy".

It is all about production/employee/hour.........the most profitable will win regardless of business entity.

Joe

[SprinklerGuy]

I agree...there is really no more stability in employees than there is with subs. It all depends on the structure of the deal. I sub some stuff out, not mowing, and it works fine because we both make money.

Perhaps those of you who are worried about stuff "falling apart" should stay solo.

The rest of us will take our chances and win some lose some. The longer we do this the more we win. The more we win the more chances we take, the mo..................you get the idea.

The solo ops will do fine too, depends on what you want. I don't think the economy has so much to do with this either. i am damn tired of people blaming everything on the economy.

Get the book "who moved my cheese". and stop worrying about the damn economy....seriously your life and business are what YOU make of it not the other way around.

[garydale]

We try get 20% on our sub's work.

Further we pass along as much of the responsibility, warranty, call backs as we can.

There are good subs out there, but you have to handle them right. Don't screw with them and pay them on time.

When your subs know you are true to your word and dependable
they will stick with you.

[Tyner Lawn Service]

I have thought about subbing out for years. I as of a couple of years ago started to deal in this. Yes a sub and a employee both can be in the same category but if handled proper I think in time it will work. I'm 47 now and if I were to sub all types of lawn care I could be semi retired one of these days and do this forever as long as my health hangs in there. I have a amount I need to get to for this to work out at 20% per job. It will take 300 lawns to make it work for me.

[ChicagoLawn]

Right on Sprinklerguy!!!


Joe

[John from OH]

Albemarle,

You aren't old enough to remember what the building industry was like 25-30 years ago. When a general contractor built a house, he subbed the excavation, electrical, and plumbing. His own crews did everything else. My brother worked for a remodeling contractor. They opened up a new home division about 10 years ago. They built 20 houses, netting $20,000+ on each the first year. They had 2 employees, a salesman, and my brother who was the superintendent. He took the plans from the salesman, subbed everything out, and monitored the progress. Over the past 10 years they have brought on their own crews. Now they are phasing out their crews and subbing again. They have trouble making a predicatable return on their investment with their own crews. A subs price is the final price on any phase of a job, excluding change orders. Bidding is much simpler.

The point I am making, the market changes, the labor market changes and customer perceptions change. Our industry is ripe for subbing as we are in the same place the building industry was 30 years ago. Everything phase can be a specialty. Mowing, applications, mulching (think bark blowers), design, hardscapes, irrigation, lawn installs, lighting, water features, and so on. We are starting to sub more work, and our goal is to be subbing out about 80% of our work within 5 years. Good subs are worth their weight in gold. You do have to make subs responsible for the quality and timeliness of their work. When a sub makes a mistake, your cost doesn't change, its out of their pocket. Paying them fairly and promptly will keep them happy.