View Full Version : MARKET SATURATION
08-15-2000, 11:21 PM
SEEMS AS THOUGH EVERYONE WITH A PICK-UP HAS A MOWER IN THE BACK OR ON A LITTLE TRAILER. IS THIS THE SAME STORY EVERYWHERE????.. I ADVERTISE AND ADVERTISE...SEEMS AS THOUGH EVERY YEAR LESS AND LESS PEOPLE ANSWER ADVERTISING EFFORTS. I HAVE BEEN ASKED TO BID COMMERCIAL PROPERTIES THAT I REFUSED BECAUSE FRIENDS OF MINE CURRENTLY MAINTAIN THEM, AND I KNOW THAT THE CONTRACTS ARE ALWAYS GOING TO THE LOWEST BIDDER..OH WELL I GUESS THATS BUSINESS BUT I'D FEEL WEIRD ABOUT LOWBALLING A FRIEND THAT I'M PRETTY SURE WOULDN'T DO IT TO ME.
08-15-2000, 11:37 PM
Same here,I see so many old toyotas and rangers with a WB hanging out the back of it.,these guys are just starting I guess,but they are making the whole industry look bad when they drive around in these jealopys with junk all hanging out.I hope they make enough to buy a real truck with an 8ft bed or trailer,or get out of business if thye cnat make that much money.
08-15-2000, 11:56 PM
Want to talk about market saturation, please don't come here. :eek: (North San Francisco Peninsula region, the City of Daly City, Westlake District) my most concentrated area I do, I know of 18 different gardeners in a 2-city block area. The city blocks each have a total of 30 houses (60 houses all together) I do 28 of them myself. The only reason I have that many are my father did them before, and then I took over in '82. Many of these clients remember me as a 12 year old helping my father. I've been asked so many times if I wanted to sell this part of the route. I do these usually in a day. Each time I clear easily over $500 and only have to drive a mile.
08-16-2000, 12:32 AM
The only difference between now and when I started in 1976 is that we are able to communicate over the internet about it.
These things remain constant:
There will always be scabs and low ballers.
They will be in business until there Sears mower dies and they have no cash or credit to replace it.
They will be in business until their pickup throws a rod and they have to hitch hike to the frigging tavern.
The" I can beat the other price" will always be the common strategy to gaining business. Do you think many of the accounts these jokers go for really give a rats ass about service , price talks.
Freightliner just announced they are laying off 775 people in Portland in October. What's the odds that 10 of them will load up the old mower and hit the neighborhood?? Not a very good time to generate business in the Northwest.
We ignore these clowns. We prequalify all calls and then talk to the ones interested in a professional, full service landscape maintenance program at above market rates with crews that show up on the day and almost the hour every week, in uniform in clean new trucks, with the best maintained and new equipment. That's how we get 30% growth without trying. I'll be doing a million a year by this time next year with no more than 8 full time and 8 seasonal employees making from $ 9 to $ 16 per hour.
I do like the scabs for one reason though, we take in outside shop and service work for our mechanic in the winter and we usually make $ 75 per hour or more. Generates an additional $ 3k in margin easily. Those guys trash their equipment. And it's cash or check ( don't dare bounce it) before they load their worn out iron up.
08-16-2000, 02:12 AM
You just entered the realm of "whenever that man speaks, I listen". I'm only a couple years removed from "when the mower dies, there's no credit to replace it", but I'm moving ambitiously in the right direction at last.
Mainly by watching folks like you and trying to do things the way I see you doing it. Right.
Very inspirational, thanks.
08-16-2000, 11:35 AM
Fireman: A bid is a bid as long as you keep it fair, I wouldn't be afraid to go against friends etc. Sometimes there's 3 or 4 of us that submit bids on the same property and end up helping one another out if someone gets behind.
Now as for the Johnny come lately's there everywhere! Here in Texas they pop up early spring and allways dissappear in July/August. Most of there customers have no sprinkler systems so when it doesn't rain they die. I started out landscaping and use this to support me no matter what the lawns are doing. Try to expand to sell your current customers additional services ie: fertilization, areation, weed control, etc. If you are not liscened then sub-contract it out with your 10 to 15% added in. This should help generate extra income from the now present accounts you allready have. For example I have a tree service that handles all my clinents and in turn for the extra work he pays me a percentage based on the size of the job. Hope any of this psychobabble helps.
08-17-2000, 10:25 PM
TG- Thank you for your kind words. I feel it my duty to help younger guys and start ups with my PhD in the School of Hard Knocks. Mr Nillison offers good advice on here very often also. In particular, know your costs, know your overhead, and don't feel afraid to make a profit. Profit is not one of George Carlin's 7 words. Don't be afraid to use credit to grow your business, but don't overextend your self. Market your services properly and to the right markets.
The first one of you who says you don't have any overhead because you are a small operation is blowing bullshit.
It is very simple to create a budget for equipment, overhead, and direct job costs. We use Business works software for financial accounting and billings, and all record keeping is done in Excel with macroed sheets of our own design.
Try and move away from a whole boat load of $150 per month accounts and mix in a few $500 to $2000 dollar ones. Makes a hell of a difference in your support times, or times that are not on the job that you still need to be paid for.
One thing I learned many years ago, is that your budgeting for time allocations and figuring your costs needs to be be at least 80% labor efficent and NEVER below 75%. That means for every 6.4 hours you work on the job site, you will need 1.5 hours of support time, be that shop, road, repair, potty breaks, MARKETING and check this out, OFFICE TIME. You need to budget those times in also. Do not work all day and then ignore your family because you have to work in the office at night. You single operators and one or two employee operations need to allocate almost a full day per week for support times.This might drive up your hourly rate somewhat, but will result in a better running operation. This is a key caluculation and understanding. Total hours avaliable to you,minus support hours equals the amount of hours you have to recover overhead and other costs. Pretty simple and mathamatical.
I don't know about the rest of the country, but in the Northwest, a single operator will have to work his ass off to make 36K a year before taxes. You really need to hire people and duplicate yourself in the field. I know it's probably worse in the Silicon Valley areas, because a lady damn near had a coronary when I charged her $ 175 a month for full care service. " I could get that for $ 90 per month in San Jose", Yeah and the house you live in would cost $ 750K too. Go back then.
Don't be afraid to look at add on services like aerations, you can gross $ 150 + per hour doing that. Unit priced services rather than hourly based income is the key.
08-17-2000, 10:29 PM
Oh, Freightliner is laying off because the Class 8 truck market is so saturated they can't sell them. Try driving up or down I - 5 between Seattle and LA. Solid stream of trucks day and night. The truck business is very cyclic and they will be rehiring in another 18 months.
If any of you guys want to make money, transportation is certaniley a good business right now. Not very family freindly though.
08-27-2000, 02:43 AM
You know i started out once.......and i am still going.....
I have seen folks start and quite....some make it some don,t
some are full time some are part......what can you do. look at this in columbus the pop... is over 200,000. and in the yellow pages there are about 75 listings of folks the want some of the pie.. you also have commercail, and industrail accounts here. just put a pencial to it just how many crews or independents would it take to cover this city..
beleive me you couldn't handel all the bussiness if you had it .the more accounts the more you depend on others to think,produce,and service like you feel it needs to be done .I have yet to seean end to aquiring customers , personnaly i have fired more customers in the last three years than i could ever handle by my self.
08-27-2000, 12:43 PM
Yep! The market IS saturated. I was talking with my helper Saturday. It seems like every knucklehead with a pickup and a lawn mower is cutting grass. Most are gone by June, and every year there are 50 new guys. So what? Stay away from the low price shoppers, get a part time job to finance the equipment you need, offer services the low ballers don't, look and act like a pro, perform quality work, show up on schedule as much as the weather allows, and invest profit in your future. You do have some control over what happens. Whether your business succeeds is decided more by you than external influences. Don't you think general contractors have the exact same problem? There are few businesses not affected by hacks. Doctors, lawyers, engineers, police, and other trained and educated professionals. I don't care what the Sprite commercial says: Image is everything.
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