03-18-2012, 07:51 AM
We have gone from hoping the phone to ring to having more work than myself and crew of 3 can handle. We provide both residential and commercial mowing plus basic landscaping.
How do any of you handle subbing out work? What jobs do you typically sub out? What percent do you add on for yourself?
I have access to some quality landscapers in my area but want a plan before I contract with them.
03-18-2012, 04:53 PM
Just spitballing here
have you looked into splitting you and your crew or possibly starting another one
OR have you thought about swapping some yards around with other guys
03-18-2012, 10:42 PM
Well, first of all, you're never going to make a lot of money subbing stuff out to others. You may make a little. But you usually can't mark up the sub's prices all that much before you just price yourself out of what the client will be willing to pay. So it's better to keep as much as you can in-house.
Now, if you're in a state that requires a license to do certain kinds of work and you don't currently have that license, then I guess you would have to sub that work out. But in my state, you cannot even contract to do the work if your company isn't licensed to do it. Doesn't matter if your sub is or not. YOU have to be licensed to contract for that kind of work. So I made it a point to be licensed to do all the things that we do. That would be my first advice to you - don't put yourself in a position where you HAVE to sub stuff out. Get the license yourself and keep the work in-house - where you can make a lot more profit.
There are a few things we sub out for. For instance, decks and concrete flat work. We don't do a whole lot of concrete work. But we do it once in a while. And when we do, we'll sub that out. I find that is something you really have to be good at, in order to do it right. Similarly with decks, we're just not that good or experienced at doing them. So we sub those out. But everything else we do, we keep in house. We just learned how to do it all, over time. There was a time when I didn't know anything about irrigation, low-voltage lighting, drainage systems, segmental retaining walls, rock walls, paver patios, seat walls, fire pits, water features, synthetic turf, etc. But I made a point to learn how to do all those things properly and now we make a lot of money on all that stuff. More than we ever did on the lawn care side.
As for how much to mark up a sub's prices - there is no exact %, really. I will mark up my sub's prices as much as I feel we can get away with. And it totally depends from on job to the next. If it's a job that is only concrete and nothing more (e.g. the sub will be doing most or all of the work), then I will usually mark up the price by $500, at least. If he gave me a price of $2,000, I'll quote $2500. That may price me out of the job, but it's really not worth me bothering with if I can't at least make that on the job. On the other hand, if it's a much larger job that involves like a paver patio, sod lawn, new sprinkler system, fire pit, lighting, planting, and concrete - in that case I may just quote exactly what the concrete guy quoted me. Because in that case, I don't really care if I make money on the concrete portion of the job. I just want to get the rest of that work.
In general, if I feel I can get away with it and still land the job, I'll mark up the sub's price by at least $500 or 10%, whichever is greater. But like I said, I hate subbing out work. I try to do as much as we can in-house. Over the years our crews have become very good at most aspects of landscaping, hardscaping, etc. That should be the goal. To have to sub out very little.
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