Beating Low Ballers at their own game

[lsylvain]

I've been thinking of my spring "special offer" for new customers this year, and was just going to use the 20% off deal i usually offer. But I was thinking of doing something to get back at some of the low ballers.

Well, first I am the only "real" business around so I won't be steeling any work from legitimate businesses.

I was thinking of putting a coupon on my door-hangers for a one time cut for about $12.00. I have a specific area that I am thinking about and the jobs are all really small, and $12 should cover my cost. I would put on the hanger that it is only good for the property that received the door-hanger. I would also put on them that they would have to get their cut before I start my other jobs sometime in march.

I'm figuring that I will get 2 - 3 times the response I usually get from the hangers. Then after I do the cut for the customer I give them a price for the rest of the season. If half the people stay with me I'll be good to go.

The other thing I was thinking about was the fact that I would be out there mowing over a week before everyone else so I should get some pretty good exposure.

I'm sure a lot of the jobs will be from cheapos, but I'll know not to bother advertising to those addresses in the future saving me money.

What do you guys think?

[MCGRAIL LAWN]

I think you should try it and let us know if it does work.

I personaly have realy small lots in one area and do lawns for $13.00 a week. I have 12+ house right next to each other takes me 3hrs.

You may call that lowballing but I get a ton of NEW customers from seeing my hard work.

New customers have 12,000+ sq. ft.

[Casey]

you might do better with a $amount off coupon, that way there won't be as much sticker shock when you tell the actual price to continue. .

[ksland]

You are cheating yourself by only making $156 in 3 hours of cutting.

[ksland]

I have to correct myself, I suppose if you have very minimal overhead, and mow by yourself, your prices are not out of whack.

[BigJim]

Mow the lawn for FREE the first time,no one can beat free.


BTW if your the only "Real" business around why are you bothering to under cut yourself any way?.:confused:

[lsylvain]

The reason I'm wanting to undercut is to raise the standard around here. There are about a billion guys with push mowers going up and down the streets for next to nothing. It has been that way around here since the beginning of time. Over the past 5 years I don't have dittley for residential accounts, live off the commercials.

I'm figuring a large portion of these people don't realize that they can get quality mowing service. If I can go in under the scrubs and do a good job, I know there are people, that will sign up.

Stuff that your customers take for granted, like monthly bills, my customers think is the best idea since sliced bread. I'm not kidding! I have had new customers call me to say "I got my bill in the mail today, that is the coolest thing, with a return envelope and everything!"

In the past I have done: $25 off, 20% off, and get the 4th cut free. the problem I have had is about half the people have me do just enough work to meet the requirements to get their deal. by that time it's really too late to get new customers in any numbers.

I've done the free cut thing before but just for a few people. It works really well, but you just can't do as many, financially hard to do. I don't know about you guys but I'm almost broke by the time I send out the first bill every spring.

I'm figuring if I can do it for cost I can cut them all day long. And since I will be doing this before I start my other jobs it will be extra $ to cover the over head that I'm paying from last years jobs anyway.

[Tvov]

Originally posted by ksland
You are cheating yourself by only making $156 in 3 hours of cutting.

If it is a one-man operation, I would think that rate ($50.00+ per hour) is not bad.

[Shuter]

You may doing something wrong in business if you are worried about the Low ball guys. The only discount that I offer is to existing customers who give me a productive lead. You should not cut your prices as you may have payments to make and are trying to make living. Also some customers who have been with you for a while may question you on why the paid full price before, but now you are doing the same work at a discount.

[johnhenry]

Not a good idea sounds way to desperate. Never cut prices.
Big Jim & ffshuter make very good valid points
If your the only real one in town make them pay your price

[kppurn]

Find out what you need to make to cover your own costs. Add to that the amount of profit you desire and you now have "your price". Back that (probably a higher price than others) up with quality work and you can then raise the standards for your area.

[Randy Scott]

Originally posted by lsylvain
The reason I'm wanting to undercut is to raise the standard around here.

Uhh, o.k.

[Toroguy]

Your strategy may work.

I sense you might be in a hurry to accomplish your raising of the standards. With continuous above "average" service this will occur in due time. With continuous "excellent" service this will occur quicker. All while maintaining the same set price.

Saturating the region requires an aggressive approach as you mention. Anything less requires patience.

The objective of getting the new customer(s) is one we can all relate with, our personal and professional timeframes may differ, but our goals are very similar.

Good luck

[lsylvain]

I'm not worried about the low ballers they can't even come close to my bread and butter accounts. I just havn't been meeting my goals in the new customer department.

Market price around here is about $15 a yard for the middle class people. I have been running for 5 years with a min charge of $25 per yard. I'm running out of places to pick up new customers. I know that people will pay my usual rates if I can get my foot in the door. I've done many an estimate on this part of town, priced them $5 lower than I would in other areas, and still have them think it is too high. Most of the guys that cut these place do a horrible job, don't trim, and look like bums. I am 99% sure that these people think that, that is how we will do the job and don't realize the difference a profesional can make in the appearance of their property.

Just to clarify, this will only be a one cut deal. NOT FOR THE WHOLE SEASON. Like demoing a ztr from the dealer.

As far as my current customers getting "upset" about the one cut deal I really don't think it will be a problem. Most of them would brag about how much more they spend to get their lawns cut.

thanks for the input guys

[paponte]

BLAH BLAH BLAH BLAH!! Oh yeah, your really getting back at those low ballers now!! YOU ARE BECOMING ONE!! So many people willing to work for free? Come work for me then, I can use the free help. I am tired of hearing about people "giving" services away! Then everyone complains they make no money, and complain about cut throating. Meanwhile your talking about doing it yourself! Then you wonder why statistics are how they are.

[Lanelle]

There are a lot of people in your area who have neither the money nor the inclination to hire a professional to do anything for them. The areas where the well-to-do live are easy enough to locate there. Send personalized letters to the 'best' people in town (Bluefield VA, WV, Bramwell, Princeton) introducing your company. Offer to provide references. (Get some of your recognizable clients to agree to be your reference). Rather than going for the cheapos, rise above and go for the doctors, attorneys and other professionals there.

[HOMER]

YA, go for the ones that are the slowest to pay!

I would scratch the idea and concentrate your efforts on better areas. If you can confine the "scrubs" to a particular area then the rest can be had by you.

Box them scrubs in and go make some money!

[lsylvain]

I allready hit up those places, every year (except bramwell) but I want more. I do the doctors and the lawyers and stuff of course I have lost a few due the the whole malpractice insurance thing, that and I've have 2 customers go to jail for medicare fraud.

I'm actually looking at dumping all of my princeton accounts because it doubles my gas cost for the year. If I don't get more work in princton than I do in bluefield or charge a lot more I'm seeling myself short. I would rather do 2 $25 jobs right next door then drive for 30 min to do 1 $30 job.

How much are you people charging if $50 per hour is too low?

Yes ther are a lot of poor people around here, but I'm not talking about them. I'm talking about the people who have lived in bluefield for 70 years and havn't been anywhere else, and don't know what they can get for their money. They have had scubs cutting their grass and are sick of the guys not showing up, doing a poor job, and running off with the money before the work is done. They think that ever "person" who is in the lawn biz does the same thing. When they find out that they will actually get what they pay for, instead of half what they pay for they will pay me double.

These places I'm talking about can be done in less than 30 min (one man) including drive time. So at $12 per cut I'm pulling in $24/hr gross for the first cut ($21.23/hr cost including labor). If after the first cut if I get them to go to just $25 per cut I'm at $50/hr. I figure if the closer the houses are together the less down time I will have waiting for someone to finish blowing cuz me and the other guy can just go to the next house and start. Thus raising my hourly rate close to what I usualy get.

[Lanelle]

I do the doctors and the lawyers and stuff of course I have lost a few due the the whole malpractice insurance thing, that and I've have 2 customers go to jail for medicare fraud.

Sounds like the place hasn't changed much.

[paponte]

I think your going about it the wrong way. What you should be concentrating on is "selling" your work. Explain to the people why you charge a little more money. I always push my years in business, experience, the fact that I am incorporated, insured, carry workers comp, our professional appearance, the fact that we accept credit cards. Were not a Joe Smoe outfit, and we flat out do a BETTER job. People understand this, and will look at your whole company profile. By undercharging them in the beginning, you look cheap... like you are really hurting for business. You have to look more professional, and sell your company as a "professional lawn care service".
I have given estimates and when I gave the price, people asked me if I were out of my mind. Once I fully explained the nature of the job, and our company... the job was mine. We get $100. per hour minimum for alot of jobs. As far as maintenance, I don't stop the truck for less than $30.00, unless it's in a group of houses.

[bubble boy]

Originally posted by ksland
You are cheating yourself by only making $156 in 3 hours of cutting.

if some people have higher rates than that, fine...but i wouldn't call it cheating yourself.

$50 per man hr gets thrown around here a lot. it's accepted as a good rate by most members, whether they earn it or not. and its above industry averages that i've seen quoted here.