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View Full Version : Real reason they won't pay the prices!


SuperiorProfits
08-08-2000, 02:07 AM
Guys I know I am new to this site but I would like to tell you why I think people won't pay the price they should. They are angry at all kinds of things like high gas prices,consumer rape is what I call it. Look how much it costs to take a family to disney world or out to dinner. The average joe and his family are not getting increases in their pay like they should. It does not keep up with all the increases in everything across the board. I agree that there are alot of lowballers in this business, but I don't think that is why the rest of us can't get 40 to 50 per man hour. It's not the lowballer it is inflation and the costs of all services being increased faster than the 9 to 5 guys jobs raises. They think they are being taken advantage of by us and everyone. I know that we are all honest hard working companies but there are a few customers out there that are just not willing to pay 40 per hour because of all this stuff I mentioned.

Guido
08-08-2000, 06:17 AM
I don't know if I can buy that one. If someone needs the work done, they need the work done. They have no choice as to how much they'll pay, its whatever comes there way.

No matter what anybody says there are two things that bring us down as an industry.

1) Pricing without a profit. (NOT LOW PRICES!!!) We all know that theres people out there that don't make a dime over expenses for the whole year, and go back in next year for the same. They work just to run a business, never make a profit. These people start realizing they're working for nothing all year and they get sloppy and start doing work that is below par.


2) I don't know about you, but no matter how professional YOU are, people will always group you with all the other "grass cutters" as they say. So you do the same thing as the guy with the mower in moms trunk, you do the same work as the guy with the bicycle and trailer, you do the same thing as the kid driving dads old snapper tractor around the neighborhood, etc. So when it comes time for you to bid one of these jobs, because the work wasn't done properly.....the question is, WHY ARE YOU CHARGING TRIPLE THE PRICE THE LAST GUY DID?? People expect that we'll all price the same and do the same work, but we all know thats as wrong as it gets!!


Now as far as a pricing standard goes, it would be very very hard. Some people would not be able to make a profit due to their equipment, some people would make a killing. BUT to do this we'd have to go as an industry, and from what I've seen I don't think it will hapen anytime soon. We couldn't even get 1,000 people on this forum to contribute $3.00 to send Chuck on his vacation, how would you get them all to unite on a set price per acre for example??

The other problem you would have is how do you keep the "Scrubs" out of the picture?? How do you keep those guys that are just cuttin grass away from our customers??

These are all reasons why, atleast at the moment, pricing needs to be competitive. The customers that we are all looking for, the good ones at least, look beyond price. They shop for the best, detailed work, not the lowest price. As long as people like that are out there, the professional will still live!!!

Scraper
08-08-2000, 09:12 AM
Well said Guido!

TGCummings
08-08-2000, 10:31 AM
I just raised the price on a customer who had been with my stepfather and I for over 20 years combined. He was paying a rate around $18-$19/hour and I needed to raise rates and/or cut back. He called me three different times in the month since I sent his notice in late June. He's not so much a complainer as a debater, and a pretty decent one, so he put me to the test. To make a long story short, I stood my ground firm, though he tried to get me to budge here and there. He spoke with four other gardeners, all of whom would charge a rate lower than my new one. His complaint about them, however, was that none of them were licensed (much less insured), so he didn't want them in his yard.

He decided last night he would stay with me. His new rate is in the $35-$40 per hour range.

They *are* out there. They will pay, and they do understand that some of us work hard and pay our dues and deserve our rewards. It really helps to validate all the changes I've been making since discovering Lawnsite.

Score one for the good guys. ;)

-TGC

jcoat
08-08-2000, 12:51 PM
Well said Guido and Cummings... one must stay legal (certified, registered, pay Uncle Sam, maintain professional equipment...) while maintaining their own standards of living (profit).
Remember, your business is a service much like a plumber or a HVAC technician. You take classes, certifications and spend mucho dinero to have the right equipment.
They are a service and make the bucks; lmos provide a service and barely pay the bills/pay bills AND make profit (That's for the operator to decide).
From a consumer standpoint I would rather pay the price for a company who is punctual, legit and has the goods to provide me a quality cut...
Also, EVERYONE is affected by inflation. If they cannot pay the bucks, then they need to do it themselves. Those are the cheapskates who complain @ the drop of a hat. If they are a professional they need to do their thing. I am a professional. Let me do my thing.
If they need to know WHY you are doing something, educate them. Cuttin' grass ain't cuttin' grass if they want their yard to have the appearance of ELM's.
My two cents!

[Edited by jcoat on 08-08-2000 at 04:13 PM]

gusbuster
08-09-2000, 07:37 PM
In regards to we charge too much, I think it boils down to this. Most people do not run their own business. Therfore, they don't realize that we pay our own expeses. All they see is wow $40 or $50 an hour, not that we may only be clearing 15 to 25 after all expenses incured. Most people just see a paycheck with tax deductions, they don't see the money that was spent in order to see that paycheck. I hope I'm making sense.
John

John DiMartino
08-09-2000, 09:53 PM
You hit the nail on the head John,the average person isnt business minded at all and doesnt have the mental capacity to understand that the 40 an hour you are charging is not what you are taking home,you'd be lucky to get 1/2.I am part time and business expenses hit me harder because sometimes 1/2 of my profit goes to pay fixed expenses like insurance and help ,repairs etc..It seems like i omly take home one weeks money out of a month billed after expenses,but having a new chopper dug into that profit quite a bit.

EarthWorks
08-10-2000, 12:30 AM
Prices in this industry and others are dictated by supply and demand. As long is there is ample supply of lawn maintenance companies competition will drive prices down. Unfortunately many people see lawn care as a commodity (one is good as the other). With no differentiation price is the only thing to compare. Couple of options: Leave the lawn care market and find a niche market where supply is lower thus driving up prices. Or: Differentiate your product, which seems to be what most are doing.

greenflag
08-10-2000, 08:46 PM
Guido and Cummings-
Absolutely right! To put it simply, you have two options: You can sweat your butt off and not make money, or you can sit in the air conditioning and not make money.