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View Full Version : Am I a lowballer


mwh350
06-03-2010, 05:45 PM
First I live in the middle of BFE montana. I have a local church house that I mow in town. The guy liked the quaility of work that I do so well that he asked if I would mow 3 additional church buildings in neighboring towns for him. I only mow part time, and even with that I have far from what I would consider to be a full schedule.

The lots are 1.4 acres, 2 acres, and 1.3 acres. Total drive time is 3 hours between all the buildings. 160 miles

I quoted him
$514 dollars per week for the contract. Bushes need touched up monthly, and there is an additional charge of 25 per man hour for them.

For 5 acres that are pretty widly spaced am I the guy that is the lowballer or are my prices pretty fair?

fl-landscapes
06-03-2010, 05:51 PM
i see drive time. but what is the total man hours for getting this work done. You gave a weekly price so man hours per week?

mwh350
06-03-2010, 05:53 PM
I figure that I should be able to get it done in 10-12 hours with a two man crew. Including drive time.

STL Cuts
06-03-2010, 06:30 PM
The math isn't looking too great on that, espescially with the drive time (figure gas as well as wear and tear on your truck). If you're part time, thats a lot of your man hours dedicated to this account (almost too many "eggs in one basket").

$514 seems way too cheap. The only upside is you have 3 locations you can use to sell other services (fert, mulch, trees, bushes, installs, etc.). These can bring in some good $$$ for you, just make sure you don't shoot yourself in the foot with those.

Good luck!

TGM
06-03-2010, 06:50 PM
$514 divided by 12 hours = $42.8333333 per hour. minus an employee at minimum $10/hr (probably more with taxes) = $32.8333... let's round that to $30/hr to be more realistic with workers comp.

$30/hr minus fuel & truck maintenance.. which is roughly $55.

30x12-55=$305.00


soooo.. in a 12 hour day with an employee you personally would gross profit $305 before taxes....


...if all goes planned and nothing breaks...

fl-landscapes
06-03-2010, 06:50 PM
I figure that I should be able to get it done in 10-12 hours with a two man crew. Including drive time.

is that ten to twelve hours per man on the two man crew.....so twenty to twenty four man hours per week......I would say you are LOW

mwh350
06-04-2010, 09:40 AM
I thought that I was probably pretty low. I think that I will still turn a profit it will just end up being a small one. I'm kicking myself now. I just really need the extra cash flow this year, and I didn't want to have my stuff just sitting. For those reasons I just really didn't want to lose the bid. Lets hope it only takes me 8 hours laugh laugh. I mow them the first time next Saturday so I will post back final numbers.

topsites
06-04-2010, 10:17 AM
First I do think more than a few of us have been there, starting out, it takes time.

Is this your first year?
If so don't feel too bad, it's normal!
Best thing now is just TRY and get through it best you can.

And so it might not be an entirely bad thing except...
I don't know what to tell you insofar as what to do, where to take it from here...
Because you're set up this way and if you make a drastic move that will more than likely just backfire as well.
So first things first, take this one step, and one day at a time.

Just do the best you can, remember, one yard, one day at a time.

Maybe next year try increasing your prices a little here and there, don't get too carried away
because that won't do you no good either but maybe do push it a little, easy now.
And, good luck.

mwh350
06-04-2010, 11:26 AM
First I do think more than a few of us have been there, starting out, it takes time.

Is this your first year?
If so don't feel too bad, it's normal!
Best thing now is just TRY and get through it best you can.

And so it might not be an entirely bad thing except...
I don't know what to tell you insofar as what to do, where to take it from here...
Because you're set up this way and if you make a drastic move that will more than likely just backfire as well.
So first things first, take this one step, and one day at a time.

Just do the best you can, remember, one yard, one day at a time.

Maybe next year try increasing your prices a little here and there, don't get too carried away
because that won't do you no good either but maybe do push it a little, easy now.
And, good luck.

Year three for me so technically I should have my head out of my rear. However I broke the cardinal rule this year and Financed a piece of equipment because I felt like it was such a great deal. Didn't need it, but for the price I felt like I would be dumb not to get it. The lowballing came after so I could Justify my "Extra" mower and get it paid off more quickly. I won't actually mow the route until next saturday. Have the Jitters, and I am hoping that it just takes less time.

MOHUSTLER
06-04-2010, 12:43 PM
If you have the 10-12 hours to spare and your makeing money then your ok. Just make sure its worth your time.

topsites
06-04-2010, 01:16 PM
Year three for me so technically I should have my head out of my rear. However I broke the cardinal rule this year and Financed a piece of equipment because I felt like it was such a great deal. Didn't need it, but for the price I felt like I would be dumb not to get it. The lowballing came after so I could Justify my "Extra" mower and get it paid off more quickly. I won't actually mow the route until next saturday. Have the Jitters, and I am hoping that it just takes less time.

Oh well, it happens even in the later years, I know I lowballed up into my 4th year
and even after that it still happened, even today some days...

I guess lessons learned, why some of us preach never finance...
If it makes you feel any better I did that in my 5th year :p
Both bid real close to the line early on in spring, which that didn't work out so good.
Then financed a Ztr in the fall...
The next year is when the stock market crashed, followed by two of the roughest economical years.
Yes, it sucked.

Guess some of us just have to learn some things the hard way lol
now hopefully this turns out all right after all.

Oh, I got mine paid for, somehow one does survive.

Peace

yardatwork
06-04-2010, 02:17 PM
It may be low, but remember...churchs typically don't pay well to begin with. This is part-time and only being used for extra cash. So I would say it's good money for him.

Cboy7
06-04-2010, 02:28 PM
its about half of what a healthy business with 2 guys should make in a 12 hr day, but like the others said .. looks like you need the money.

slamjamrockinman
06-04-2010, 03:47 PM
Like others said, try to sell a few more of your services to him. Fert would be helpful if your liscensed. We all have made bidding mistakes, if he won't give you more next year, I would drop it.

Florida Gardener
06-04-2010, 06:06 PM
I wouldn't feel too bad, we have all been there. Def. try upselling everything. When I get on a property for a bid, I look around and see what extra money can be made. Palms are always good b/c they are easy to trim and quick money. Fertilizations will add some extra $$ in your pocket. Mulch, installs,etc. Having to stick out a bad bid sucks, but if you can make additional money, it takes the sting out a little bit.

topsites
06-04-2010, 09:51 PM
Unfortunately I find the initial bid almost always sets the stage...
Might be the one compelling reason I can find why one might want to start high,
of course this unfortunately sends the half of folks scrambling for cover heheh

But if I go to a restaurant and they sell me a foot long sub loaded for $4...
Do you think I'm going to up buy drink and fries for another $4?
Doesn't seem like a good deal to me!

Interesting how it works, if the sub instead had cost $6 and for only a dollar
more I can get big bad french fries I might consider it, another dollar for a drink?

You can almost ALWAYS upsell some cheap BS over top of the big job,
I do it all the time, especially when it goes hand in hand.
Doesn't work but so good any other which way, personally speaking.

Anyhow...
It'll be all right.

Florida Gardener
06-04-2010, 10:15 PM
^You may think that way, but someone may think that, hey that sub is usually $6, I saved $2, so sure I'll spend $4 more on the other stuff. Every customer is different. Pricing maintenance is very tough. Most people think anyone can do it(although most people don't do it the right way) and that it shouldn't be paid much. If you go out and price everything high, you will get no work. Especially around here......

jasonnau
06-05-2010, 11:32 PM
$514 divided by 12 hours = $42.8333333 per hour. minus an employee at minimum $10/hr (probably more with taxes) = $32.8333... let's round that to $30/hr to be more realistic with workers comp.

$30/hr minus fuel & truck maintenance.. which is roughly $55.

30x12-55=$305.00


soooo.. in a 12 hour day with an employee you personally would gross profit $305 before taxes....


...if all goes planned and nothing breaks...

That is exactly how I would break it down. Too the tee.

indy2tall
06-06-2010, 12:12 AM
Ok is the 514 just for the three additional churches or is it for all four together? If it's just for the three additional churches it seems to me from the way you described it you must be using 21 inch push mowers!! (just kidding). You are allowing between 2 to 3 hours site time on each property with a two man crew (10 to 12 hours minus 3 hours drive time). That seems like an awful big chunk of time to mow and trim 2 or less acres at each church. I agree with the other guys in that if it really takes you that long then it's underbid but if you only end up spending an hour at each church then you have a good paying account.

ShooterK2
06-06-2010, 10:15 AM
First I live in the middle of BFE montana. I have a local church house that I mow in town. The guy liked the quaility of work that I do so well that he asked if I would mow 3 additional church buildings in neighboring towns for him. I only mow part time, and even with that I have far from what I would consider to be a full schedule.

The lots are 1.4 acres, 2 acres, and 1.3 acres. Total drive time is 3 hours between all the buildings. 160 miles

I quoted him
$514 dollars per week for the contract. Bushes need touched up monthly, and there is an additional charge of 25 per man hour for them.

For 5 acres that are pretty widly spaced am I the guy that is the lowballer or are my prices pretty fair?

I don't know what equipment you have, but with a two-man crew and pretty much anything larger than 21" mowers, I would think you could get this done faster than the 10-12 hours that you are estimating.

To be honest, your pricing doesn't sound too far off to me. I live in a small town in the middle of nowhere Oklahoma, and we don't draw the kind of money per man-hour here that most folks on this site claim to get. I find that about $35 per man-hour is about the best I can do for mowing. A little more for landscaping/tree work since I hate it so much and would just as soon walk away from it as to do it, so I price it high to begin with.

You and your helper should easily get these properties done in a day (provided all goes well), and that is well over $2000 a month income for your part-time operation (before expenses), so I'd say it's fairly close. If you find that it is indeed too low, try to stick it out this year, then raise your price for next year.

Just my $.02

milkie62
06-07-2010, 12:29 AM
You just have to hope that alot of your time is weed trimming since there is not much overhead doing that.I bid a couple of properties a bit low since I did not think the trimming would be as long as it was.But my 20 yr old Homelite trimmer is still running strong.Have 2 spare power heads that were given to me and I have to replace the string head since it wears out every year.So lets see trimmer head $18.95 plus I just opened my 2nd 3lb roll of
095 string.Gas and oil about 1.5 gal/week.I buy my trimmer string at end of year clearance for about half price at Walmart.

andyslawncare
06-19-2010, 01:20 AM
3hrs + 5 acres... We can knock out 5 acres in far less time. Pay your help minimum wage during transport for 30 mins or more... that adds up! I bid based on a desired hourly sales of $35 per man hour for maintenance. I never charge a customer by the hour, but I try to guess time. I have a 3 man crew, so $105 per hour... we do full service maintenance...anything that needs to be done gets done on each visit.

Your charge may be able to be lower than ours, we have a bunch of overhead! I personally work double overtime hours and have invested around $100,000 and 20,000+ hours in the past 5 years.

topsites
06-19-2010, 02:32 AM
my 20 yr old Homelite trimmer is still running strong.

I have never in my life encountered a Homelite piece of equipment that wasn't
the most complete POS I have ever handled, I am thus assuming you were
making a joke.

andyslawncare
06-19-2010, 03:22 AM
I have never in my life encountered a Homelite piece of equipment that wasn't
the most complete POS I have ever handled, I am thus assuming you were
making a joke.

haha! what's that like a kmart brand?

mwh350
06-19-2010, 01:01 PM
3hrs + 5 acres... We can knock out 5 acres in far less time. Pay your help minimum wage during transport for 30 mins or more... that adds up! I bid based on a desired hourly sales of $35 per man hour for maintenance. I never charge a customer by the hour, but I try to guess time. I have a 3 man crew, so $105 per hour... we do full service maintenance...anything that needs to be done gets done on each visit.

Your charge may be able to be lower than ours, we have a bunch of overhead! I personally work double overtime hours and have invested around $100,000 and 20,000+ hours in the past 5 years.

Are you bagging all five acres and hauling the clippings to the dump?

mwh350
06-19-2010, 01:05 PM
So after the second week actual time taken on the three accunts was only about 9 hours including drive time, and hauling the clippings to the dump. I was able to mow several other accounts when I got back for the day. However I did take two minimum wage employees with me for the day.

milkie62
06-20-2010, 12:02 AM
I do have a 20 yr old straight shaft Homelite trimmer that i really like.I like it better than my echo I think it is a model 260---that is how much I remember about it.My son uses that one.I do wear out a head every season,but it only costs $18.95 from the dealer down the road.It always starts and there is never a problem with it.My buddy just gave me one since he has had problems with starting it.So I have a bunch of parts now.
Do not see any reason to get something else just yet.

GreenGuysLC
06-20-2010, 12:33 AM
I have a similar situation. I currently cut 4 churches and pre gas spike was cutting 9, nearly 400 miles round trip. When doing all nine I used a three man crew with three mowers. 7 were done in one day and were all out of my normal service area. We spent 12 hours on these 7. The following day a two man crew got the other 2 in town. My 12hr day consisted of 6-7 hrs cutting and 6 hr driving. That days pay added up to 1100. the other 2 properties took 3h cutting and 2 hr drive, total for those was 375.
When figuring the long trips like this i would try to get minimum $40 per drive hr, and $80 pe cutting hr.
Today I still maintain 4 properties that take around 4.5 hrs, and drive time of 3 hrs. I bill out $670. I am only running one employee on this route now. Profit much better and staying closer to my territory. At the end of the day I want my billings to equal $100 or more per hour worked. At $100 per hour, then deduct employees -10, fuel -10 (conservative) insurance -? , mower use (wear and tear over the life of engine . .) -25 . .Already pushing $50 dollars expense out of the $100 I try to achieve. BTW . the mower use . . I figured this at one time . . based on 1500 hours, doing routine belts, oil, plugs, new blades,fuel consumption, etc and it comes out costing me $25 per hr to operate the mower . . not counting the labor to run it.

BOTTOM LINE . . You need to be thinking >$100 per hour worked, drive time included.

Butler Landscaping
06-20-2010, 01:27 AM
you could get some new yards by mowing these churches to make the drive a little less wasteful if u have something with your company name and # on it. (t shirts, trailer sign...) i mow a car repair shop and people always ask about me in the shop or come out and talk to me while im mowing

Butler Landscaping
06-20-2010, 01:29 AM
I have never in my life encountered a Homelite piece of equipment that wasn't
the most complete POS I have ever handled, I am thus assuming you were
making a joke.

im soo glad my homelite backpack blower got stolen last year i HATED that POS!