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costcutter
10-23-2003, 08:26 AM
I HAVE BEEN READING ON THIS SUBJECT OF SAY PRICING ALL YOUR CUTS FOR YEAR BUT DIVIDE IT BY 12 SO YOU GET PAID IN THE WINTER. MY ? IS WOULD YOU HAVE TO HAVE ALL THESE PEOPLE ON CONTRACT BECAUSE IT SEEMS IF YOU DIDN'T THEY COULD DROP YOU AFTER BUSY SEAON AND FIGURE THEY COULD JUST GET THE NEW PERSON ON THE BLOCK NEXT SPRING. RESIDENTIAL I HAVE TROUBLE GETTING CONTRACTS. I LIKE THE IDEA BUT DON'T WANT TO GET SCREWED IN THE PROCESS. IF SOMEONE DID THIS YOU ACTUALLY WOULD HAVE GOT LESS THEN YOU WANTED FOR THE CUT BECAUSE YOU DID NOT CCLLECT IN WINTER MONTHS. HELP ME HERE GUYS AND GALS CAUSE THIS IS SOMTHING I WOULD LIKE TO DO BUT I SEEM TO HAVE TROUBLE GETTING PEOPLE TO UNDERSTAND THIS SYSTEM. THANKS BILL

NC Big Daddy
10-23-2003, 10:07 AM
When you turn your CAP's lock key off I'll start reading your post..

costcutter
10-23-2003, 01:43 PM
If I did something wrong because caps were on I apoligize. I have never had anyone say anything before.

ronslawncare
10-23-2003, 01:53 PM
nc big daddy give me a break.why even post that how is that helpful.

WeatherMan
10-23-2003, 03:47 PM
Useing CAPS is considerd YELLING online. As far as your question. After my first year in buss. I had enough customers build up to give them a choice either sign the contract or we will not be back next season. I had all but 2 sign the contract. and now I wont take on customers unless they sign a contract. My billing date is from january to january

Hope this helps

olderthandirt
10-23-2003, 04:45 PM
[QUOTE]Originally posted by WeatherMan
[B]Useing CAPS is considerd YELLING online.

But were online, no one really hears what your typing If you don't like reading material in caps thats fine. But when I"M yelling the person I'M yelling at will know it

lawnman_scott
10-23-2003, 10:58 PM
Here is what i do. I come on average 42 times per year. Every week in summer, apr-oct. And every other week in winter, Nov-March. So i bill monthly. If your not cutting at all in winter, i would leave it the way it is, and pay per cut, but if you are doing like me, it makes things simpeler, and more consistant. P.S. I didnt see this thread before.

paponte
10-23-2003, 11:01 PM
GET A SIGNED CONTRACT FOR EVERYTHING!! As far as stretching payments out over 12 months, I only offer that for seniors, since they are on a budget. All other customers get billed monthly, and are due upon receipt. (unless they have an approved credit line). :cool:

chefdrp
10-23-2003, 11:02 PM
I would like the 12 month billing too but the people around here just do understand it and must be afraid. sorry i cant help you out.

mower_babe
10-23-2003, 11:23 PM
We only bill for the months that we mow. We mow an average of 20 times. Yep. it sucks. Cannot help you out with this one. Sorry.

thill
10-23-2003, 11:35 PM
We bill a monthly average for a twelve month period. We offer an agreement that shows how this is calculated based on the number of service trips per year.

We bill on the first of each month, in advance with 10 day terms and receive payment of over 80% of the clients by the 10th to the 15th of each month.

The client may cancel at any time for any reason and if they have paid for more visits than they have received, they are due a refund.

If they have received more visits than they have paid for,......they owe us.

Guess what..... they do not feel pressured and sign the agreement.

We have never had a cancellation for reasons other than economics. I hope that speaks for our quality of service.

It works well for us.

Green in Idaho
10-23-2003, 11:40 PM
Originally posted by mower_babe
We only bill for the months that we mow. We mow an average of 20 times. Yep. it sucks. Cannot help you out with this one. Sorry.

20 times?
M-B,
Is that because you end up skipping during hot weather? What's norm start & end of season there?

Johnny
10-23-2003, 11:58 PM
I think it would be more beneficial to your customers than it would be to you. Sure, you produce cash flow during the off season. But wouldn't that money do you much better if it was in your bank account instead of theirs. And doesn't that create more work for you, 12 invoices instead of 9. All your costs add up. Not to mention the stress of "I hope they pay" or "I hope they don't move out of town".

Now, in turn, when paying some of your expenses (taxes, salaries, loans, etc.), pay them on a 12 month basis. Working the same way, money stays in your account and not in theirs.

Collect $'s as soon as possible and hold on to your $'s as long as you can.

DUSTYCEDAR
10-24-2003, 12:01 AM
get your money as fast as u can and put it in the bank to get intrest 4 u not them. it is best to bill 4 the service in the month it was provided if u want a contract do it 4 as many cuts as u think u will do and add a extra cut clause if needed

GeorgiaGrassMan
10-24-2003, 12:02 AM
Here's an idea that I'm playing around with in my head. A prospective customer calls up and asks for a price for basic maintenance. I go out and have a look. I give them the maintenance price (in writing) but I also give the a fert. and weed control price, a price for trimming hedges, a price for aerating, ect. I tell them, here is your maintenance quote and I went ahead and gave you prices for other services you are likely to need in the course of a year. Since my goal is to do everything for them, I'll offer to add up the cost of all the services and divide it by twelve. If they want to go that route, I'll send them a statement each month with a list of the services I performed along with the prices for the services and show their payment for that month. I'll also show a running balance. Depending on the time of year that they sign up, the statement will normally show a balance due. If they decide to quit, they just pay their balance and we part ways. The advantage for me is that I get all their business. The advantage for them is that they get the works and they get it at a fixed monthly cost which is easier for them to budget. Any work not covered in the plan, they pay me at the time the services are rendered so they stay completely seperate and don't show up on their statement. If I have to mow more than I guessed (I'll be sure that doesn't happen), I'm not sure what we do about that. Remember I said that I'm still thinking this through. If I mow less than I estimated, I'll refund the difference at the end of the 12 months or they can reduce next years plan by that amount. What do you think? Too complicated? I'm sure if I think it through some more, I can simply it and explain it better. The key thing for me is that I want their extras - all of their extras. I estimate that I can only count on mowing here about 800 hours per year, but extras help to move that number up to closer to 1200. If this plan helps me to get their extras then it's a good thing. Oh - one other thing, if they only want basic maintenance or they only want fert and weeds or whatever, I won't average the cost for that - ONLY if it helps me get all their business.

mtdman
10-24-2003, 12:09 AM
CostCutters, you are right on with your question. I say divide by 6 or 7 and get your money during the growing season. That way a customer can't just pay until Oct and then walk, sticking you for 3 or more months. Yeah, it would be nice to have money rolling in during the winter while you aren't working, but anyone who can budget and save should be able to sock the $$ away for the off season. And if you can't make enough to get you through the winter, you are doing something wrong.

:D

Johnny
10-24-2003, 01:14 AM
[ I give them the maintenance price (in writing) but I also give the a fert. and weed control price, a price for trimming hedges, a price for aerating, ect. I tell them, here is your maintenance quote and I went ahead and gave you prices for other services you are likely to need in the course of a year.

This approach in bidding accounts is a great idea. While saving future visits for bidding purposes, it gives the home/business operator something to refer to. A menu with prices to order from. If they are shoppers they will probably never hire for that service anyway. If they are lazy (and most people are) they won't call anyone else, because your menu/prices/phone number is on the refrigerator. Maybe that is it... customized menus for each property.

I wouldn't go with the 12 month even billing plan, though.

mower_babe
10-24-2003, 01:38 AM
Originally posted by Green in Idaho
20 times?
M-B,
Is that because you end up skipping during hot weather? What's norm start & end of season there?

Season usually starts middle April and ends late Oct. Usually about 26-28 weeks, but ALOT of accounts get spread out during hot July-Aug or cold end of season 10-14 days. Been doin this over 5 yrs and it avg out to 20 mowings. There is one account that we havent touched for over a month. Just mowed it yesterday. Talk about budgeting. ugh.

mtdman
10-24-2003, 01:59 AM
Mower babe, we have pretty much the same schedule and I always figure for 26 weeks when doing a prepayment. I want to do a monthly rate next year, and I want to do 26 weeks for that as well. BUT, with the weird weather and crazy leaf drop this year, I haven't mowed regularly in the last month. I am worried that many folks won't go for 26 weeks and use this fall's irregularities as an example. I have been thinking about including leaf cleanup with the 26 weeks price to make the idea more attractive.

bobbygedd
10-24-2003, 02:04 AM
personally im done with the "12 month averaged out " payment plan. no body else gives credit like that without charging interest. and no matter how clear u word the contract, or how many times u explain it, i always get this, " hi bob, this mrs. beanbrain over on dum dum street, i think u made a mistake, i recieved a bill, but bob, you werent here last month, im assuming it was a mistake." from now on its like this: fert programs pre paid, in full. anything else due by the 30th of each month. period! i dont need to get a check for 12 months, ill manage my finances just fine

MacLawnCo
10-24-2003, 02:09 AM
Originally posted by bobbygedd
fert programs pre paid, in full. anything else due by the 30th of each month. period! i dont need to get a check for 12 months, ill manage my finances just fine

Exactly. No discounts for prepayment either. Also, i dont care for writen contracts. From what ive learned, verbal holds as much weight as a written contract does anyday. Ill take a handshake and a smile, thank you. (keep in mind i only work residentials)

pinnacle
10-24-2003, 08:31 AM
fert programs pre paid, in full. anything else due by the 30th of each month. period! i dont need to get a check for 12 months, ill manage my finances just fine

Bobby.........Spot on mate!


costcutter..............Thats the way all REGULAR ACOUNT ballances should be billed :)

KerryB
10-24-2003, 10:50 AM
I use 12 month contracts. I also overseed 90% of my customers so I am cutting all year except for maybe Jan. & Feb. .
But even on the props I dont overseed I get paid the same each month all year. But I do show up on their property 2 times in the dorment months. I blow their driveway, pick up debris that sort of thing.
So its not like I am stretching out their payments for work I have done in the growing season. I work harder during this time when the grass is growing fast but I make up for it in the winter.
Plus by being on the property all year I am always in contact with the customer. They dont have several months to forget about me.
They usually have addons for me during this slow time and that equalls more money.
You would be surprised at how much you can sell during this time. It helps showing them how dreary their landscape is during winter and you can suggest and show them how a little winter color can add to their home, their outlook on life, and your bottom line.

mower_babe
10-24-2003, 12:13 PM
we don't prepay anything - that would never fly here. If I mow June 2nd, 9th, 16th, 23rd, 30th well, then on July 1st, I would prepare a bill for June for those dates, itemized, and I put on the bill net 10, yadda-yadda. If I proposed prepay, I would get cancelled. We only charge what we mow, if we only mow the front, then it is prorated. No complaints.

Southpaw
10-24-2003, 12:49 PM
i always get this, " hi bob, this mrs. beanbrain over on dum dum street, i think u made a mistake

Hilarious!!!

First starting out, I was all in favor of the 12 month pay plan. I designed my sales pitch around more than just mowing since off season people needed a reason to keep paying. So I threw in a power wash, leaf removal, gutter cleaning, whatever. As smart as some of my customers are, they just don't seem to get it. So I have practically adandoned the idea. I know school teachers often get the choice of being paid all year or just during the school year. But they actually get paid regardless of their choice. I have heard too many stories of non payment in the off season to scare me away from doing it anymore. I still have two customers that pay all year, but I no longer bring it up unless the customers says it first. I know it works out great for some of us, not for all of us though. Whatever makes you the happiest is the way to go.

summergrove
10-24-2003, 01:14 PM
I bill 12 months for commercial and monthly for res. You can better orginize your budget knowing what your income will be.I also let them know that all services must be paid in full if they choose to cancel.Most people here like making monthly payments and I let them know any services charged for but not done can be swapped for other services or taken care of with Dec billing.

I am Me
10-24-2003, 06:26 PM
My thoughts, my way of doing it. (Residential)

I get a call for a bid, I go look at it. I use a bid sheet that covers all of the items I provide. This includes spring and fall color with suggested plant material for our area.

I have a check box in front of the service, then a space following the description for the price. So if the client wants Mow, trim, blow- I check it, price it, and give it to them. This is on carbonless paper, so they get a copy and I get a copy. It's professional, and it serves 2 functions that I'll cover here shortly.

On the bottom have my terms for cancelation, mowing frequency, billing period, remitance terms. If they decide to sign up right then. I have them sign it, and they keep a copy for their records. If they want to think it over, then call me at a later date for service, I pull their record, take it with me, meet them, cover it again, have them sign both copies, and we go from there. It doesn't look like a contract, but gives you the meat you need to protect yourself.

The reason I give them a bid sheet is simple. Marketing. It puts in front of them all of my services of which they may not have known about, considered, or thought that I did. I have picked up several add ons by doing this, especially with sprng and fall color. A lot of home owners do not know that this service even exists. They do it themselves, and most of the time shoddily. By including suggested plant materials, you can offer them suggestions, and have a decent idea of what your price would be. I have been able to give some estimates on the spot for installs because I had my pricing in place already.

Pricing is very simple. It boils down to what YOU need to earn to be profitable. This has been covered many times, in many threads. IF you are going to charge more than the competition, then you had better be prepared, and able, to tell them why. Bashing their current service doesn' count. Sales 101. Quality, reliability, PERSONALIZED service, is the key to my business. I leave them a note regarding problems I see, or suggestions on improving the lawn. (Water more, water less, "hey buddy, you have grubs") Personalized service. What does it take, and extra 5 minutes?
Just remember- state your price with confidence. If you are afraid of it, they will be afraid of it.

Lastly, this. Use all of the tools in tool box. Draw up form letters and save them on your hard drive or on a disk.
Such as: Welcome, Thank you, It's that time of year to do..., We missed your payment this month, we like referals, etc.

You can even go so far as to create a word doc with all of your customers names on it with addresses so you can just cut and paste it into the letter. Pop it into the envelope with the bill, and you have covered a lot of ground with one stamp. Keep it simple, and easy on yourself, but cover as much ground as possible everytime you have contact with them.

Here is what goes into my envelope everytime:

Invoice
pre-determined letter
2 Business cards
small pad of post it notes with my company name and phone number.

It is all covered by a single stamp.

lasher66
10-24-2003, 06:48 PM
I think you can tell if someone is trying to yell by using caps just by what someone is saying. This guy was definitely not trying to yell by just asking a simple question and typing it in caps. So I suppose you are a grammar and spel cheker too? Leave the guy alone and dont read it if you dont like it!!!!!!!!!

Lasher

NC Big Daddy
10-24-2003, 06:50 PM
Bravo "I am Me" well put and great advice.

Oh and to you guys whinning about me saying something about the CAP's lock key. Not only is it bad form to use the CAP's lock it's also very hard to read the post.

LawnMower
10-24-2003, 07:23 PM
I bill ones a month. I send out a statement for how many times iv been there. The statement shows the work since January up to the currant date. Also when they payed, and there currant balance.

It works well for me.

sniggly
10-24-2003, 07:35 PM
I have been lurking here on lawnsite for quite some time...and here are my thoughts on contracts.

I do strictly residential.

12 month agreements/contracts are a win-win situation for my business and my customer.......and that's the way I SELL IT!!! Yup.....I said sell it.

This profession, I have found, lacks certain people skills and being able to convince someone to do something is a people skill.

I think it was MacLawn that brought up verbal being as good as written. He is mostly right. In most states common tort law upholds the legal binding of verbal agreements, but the benefit of a written contract to the business owner is the 'legal veil' the customer perceives of something being on paper. Seems to have a stronger meaning or something. The benefit to me as a company is that I earn the same year round.....and my profit, expressed as a percentage and as a shear number, is higher in the winter months.

Someone else mentioned no interest for the customer if paid over 12 months. EXACTLY!!!!......that's a selling point guys! Where else can you go and get a contract on a service without a credit check? If the customer doesn't pay we cancel their buts and line up the next account!

Sell Sell Sell. If a customer lets me in their kitchen or comes out into their lawn to talk with me........I shut em down tight like a frogs butt. They don't stand a chance! It's attitude.

I use contracts to my advantage.......or as some of you might think......my 'perceived' advantage.

:blob3:

AztlanLC
10-24-2003, 07:57 PM
oK. Here's how I see it and it works for me.
Keep in mind that this is what I tell to myself all the time.

The only way to stay in this type of business and any other is to have a dependable income, whatever you have to make to be able to support yourself and the company.
When I say this I'm talking about
Payments for the truck(s), rent for shop, fuel, loans, fines, insurance, etc. etc.
pay yourself a salary, healt care insurance, workers comp for you, 401k, pay vacations, sick days, personal days, etc..
and also set aside a savings fund for whetever you need it.
I don't care if you do this part or full time, if you have a big house where you can park your truck, if you get health insurance trought your spouse's plan, if you never get sick or don't take personal days.
All of this you have to keep in mind whenever someone calls you for a price.
In my area a season without skipping a cut would be 28 times, we star in march or april with spring clean up, then star mowing mid april trought mid october then leaf clean up every other week till nov 30 or before if starts to snow.
Taking all that into account I set up a price for the whole season and divide by 8 payments april trough nov.
Doing this I don't have the calsics, don't mow my lawn this week, it really doesn't need spring clean up, don't do the leaves until everything is down, and so on.

This is my job and I take it seriously, I don't gamble with my income my family depends of it, I don't look for customers that care only for themselfs, I look for the ones that care for me as well.
You want to risk your money and future, go to vegas.
and for those that says that my area won't work or my customers don't like contracts, let me tell you taht there's a lot of lawn care companies in my area too, like any other place in this country, I'm one of the few that only takes customers in a contract, I might not be the biggest company around but I have quite some customers and every year I keep getting more, and every drought that we get more companies go out of business due to the lack of income.

walker-talker
10-24-2003, 08:07 PM
Originally posted by bobbygedd
i dont need to get a check for 12 months, ill manage my finances just fine Amen!!! I hear so many people bragging that they get a check through the winter as if it was free money.....when in reality they are getting paid less because they are spending time invoicing through the office season. It all comes down to management. If you have a hard time managing funds throughout the season....then power to ya!

lawnman_scott
10-24-2003, 08:30 PM
I get a check every month, but then again we work through the "office" season

sniggly
10-24-2003, 09:25 PM
'Office' season.......good one Lawnman_Scott!

GeorgiaGrassMan
10-24-2003, 10:29 PM
I could care less about getting a payment 12 months out of the year. What I'm trying to do is to make it easy for the customer to buy everything I offer. For example, lets say I have a customer where I do maintenance only and this customer has 10,000 square feet and I charge them $42.00 to cut. Now its July and they need: 1) fertilizer (Bermudagrass) 2) Lime 3) spot treat for weeds 4) hedges trimmed. They are used to paying $168.00/month and now I've got to go try to sell them on the fact that their bill will be $485.00 this month. It can be done - obviously - but I have to waste time selling to this customer when I've already spent time selling to them earlier in the year. Then when they start looking at $485.00 and thinking about the expensive vacation coming up, they say something like, "do the fert and skip the rest" - not because they don't want the rest, but because I have not my business convenient to do business with. What I'm getting at is that this is about making it easy for the customer to give me lots of business. It has nothing whatsoever to do with cash management for me - it has to do with cash management for the customer.

One other thing - someone said that no other business does this. I beg to differ. My natural gas company and my electric company have indentical plans. As with their plans and the one I am proposing, if the customer terminates before the year is up, we settle up. I might owe them or they might owe me. Thats why I give them a running balance each month. Their statement may say that they owe me $285, but their averaging plan calls for a $168.00 dollar payment this month. If they want to go elsewhere, they pay me the $285 and its a done deal if they want to continue, they pay the $168.00. This kind of plan shouldn't require much of a contract because everything is right there on the statement for the judge to see should it come to that.

bobbygedd
10-24-2003, 10:39 PM
by the way....a verbal contract, is only good, if both parties admit to having one! considering we live in a world full of liars and thieves, what is stopping the client from saying, "your honor, i never agreed to that."?

mtdman
10-24-2003, 10:58 PM
Originally posted by mower_babe
we don't prepay anything - that would never fly here. If I mow June 2nd, 9th, 16th, 23rd, 30th well, then on July 1st, I would prepare a bill for June for those dates, itemized, and I put on the bill net 10, yadda-yadda. If I proposed prepay, I would get cancelled. We only charge what we mow, if we only mow the front, then it is prorated. No complaints.

That's what I thought too, until 3 years ago when I began offering a season prepay as an option. One person asked to prepay the season, and I gave them a discount for doing so. Then I thought, why not offer it? So I did, and I had a ton of people snapping it up. I had over 20 accounts prepay this year, for over $10,000. That's ten grand up front in April, before I've even done any work. That is nice. I never thought my customers would go for it, but it turns out many think it's nice not to have to write a check every month. I've never had a problem if I had to skip a week due to weather, etc. I just make sure I get 26 weeks in, and if not I make it up with an edging or leaf cleanup, aeration, etc. It works great.

I require a deposit for snow clearing that I keep half of no matter what, to insure I make a certain amount of $$ each winter. I was tired of the 5 snowfall seasons, and to keep doing it I needed to make a minimum. SO I require a deposit, half of which I keep no matter what. I thought for sure no one would go for it, but sure enough, every customer took it and paid the deposit, never had a problem with any of it.

The moral is, I thought my customers would not work with me on deposits, prepays, etc, but it turned out they did. I believe that if the customer likes you, is loyal, and appreciates the work, they will work with your terms of payment to keep your services. And if not, maybe you don't need them. I am trying to make a living here.

GeorgiaGrassMan
10-24-2003, 11:02 PM
I hear ya Bobby. I said it wouldn't need much of a contract - not that it wouldn't need one at all. I would have them sign something in the beginning listing all the services and their prices that the averaging plan is based on.

I thought of one other thing I like about this idea. If you can sell the customer on the concept, you are getting them to agree to your prices right then and there. They will base their buying decision on the $168.00 per month - not "oh geez look at that - $120.00 to aerate." The price would be listed for each service for them to see, but you can keep them looking at the big picture rather than the prices of the parts and pieces. Instead of thinking "$120.00 seems high to aerate", if you do a good job of selling this, they will be thinking "I can get everything my lawn needs for only $168.00 per month." The thought might enter their mind for just a moment that "I bet Bobby might be cheaper - I should get a price from him" but I bet in most cases, their next thought is "yeah but Bobby doesn't have a plan like this to help me budget for my lawn care - I'll go with this deal."

o-so-n-so
10-24-2003, 11:06 PM
Do what your managing skills will allow you to do. Contracts are good if you feel comfortable with them. If you have X # of contracts and spend hours at the computer at billing time...its not for you. It needs to be simple or you will regret it.

I do what "Thill" does. I also have a full time wife/secretary to handle the billing.

Thill, AztlanLC, Sniggly and I am me all have great comments/ ideas.

Good Luck......

bobbygedd
10-24-2003, 11:11 PM
georgia i agree, it sounds great, on paper. this is the problem ive been having with the "easy payment plan.": the payments get paid just fine during the season. however, when they start getting bills during the off season, they all of a sudden forget that this was the agreement. i have too many people saying, "why am i getting this bill, you werent here this month?" either that, or they juast take thier time paying, since its off season and they really dont need you. personally, my vacation(jan, and feb) should be spent relaxing. no business, or customer corrospondense, and the stress that comes with it. jmo

lost mountain
10-25-2003, 02:19 PM
Thats why I give them a running balance each month. Their statement may say that they owe me $285, but their averaging plan calls for a $168.00 dollar payment this month.

This is the better way to do levelized / year-round billing. If you pay your insurance premium monthly this is how they basically handle it (even though there is a deposit to get the policy started). We do year-round/ flat fee and show no "running balance". To show the balance, it does require using a maintenance log for the foreman to check off the services that were performed. That does require labor and it also requires labor to type in what was done each month in your accounting software. Ofcourse it requires doing exactly that with the "by-the-visit" billing.
I also agree with GeorgiaGrassMan that it is important to "lock the customer" into as much as possible in maintenance services from the beginning. Having said that, I am considering offering tiered maintnenance plans sort've like Bass Custom Landscapes does - see here: http://basscustomlandscapes.com/basic.htm I think we could possibly charge not much less for basic maintenance services and then add turf program, ornamental care, mulches, seasonal color for even more than we charge now.
To date though, we have had few problems with year-round flat fee and we do not show up weekly, etc. in the winter merely so the customer won't get paranoid about what they're paying for "that month". Tracking services performed has to be a very efficient process because that's where the "office time" you guys are referring to really gets heavy in my opinion. This "Clip software / handheld barcode scanner or Palm Pilot field entry and all ultimately downloading into Quickbooks" would be nice for tracking services performed.

Likestomow
10-25-2003, 09:45 PM
I have some 12 month contracts, but only a few. I’ve also had a customer want out before the 12 months were up. I don’t need a 12 month contract to manage my money… some do, but I don’t.

What I am going to initiate in 2004 is a “Service and Payment” agreement with all new customers. They will be billed each month for the service performed, but they are going to agree to pay attorney’s fees and court costs if they decide to go south on me. I will give them a 20 day cancellation period if they want out, and if they insist, I’ll let them go immediately. What I want is for everyone to be liable for payment. I am also going to begin charging late fees.

olderthandirt
10-26-2003, 12:52 AM
Originally posted by bobbygedd
by the way....a verbal contract, is only good, if both parties admit to having one! considering we live in a world full of liars and thieves, what is stopping the client from saying, "your honor, i never agreed to that."?


Your honor I swear to tell the truth the whole truth and nothing but the truth. Unless it hurts my case!!!!

lawncareguy702
10-26-2003, 01:24 AM
HOw many people "pre-bill" as opposed to sending a bill at the end of every service month??

mtdman
10-26-2003, 01:48 AM
Originally posted by lawncareguy702
HOw many people "pre-bill" as opposed to sending a bill at the end of every service month??

My package plan is basically a pre-billing. And the plan I am going to put into action next year will be a pre-billing deal, at least at the start of the season.

Mikes Lawn Landscape
10-26-2003, 08:20 AM
Threads like this are great it gives us new guys a lot of good info to help us in our business decisions. But I think there is a definite distinction between myself as a new guy and someone who has been in the business for several years. I personally am not trying to sell contracts AT THIS POINT I am trying to get clients so I can build a good solid customer base. Eventually yes I will sell contracts and only take on customers that are in it for the long haul. Right now I do the "can you mow me today because my grass suddenly grew 6" overnight and I have a party tomorrow customer". When I get established then that customer will be told no I only do regular service or the charge will be double for an emergency mow plus more if growth is substantial.

A lot of people still look at us as scrubs and until you have a relationship with the client it is hard to get past that. I constantly have to tell my customers I will invoice you for my services NO I do not want to drive over to your house and pick up a check you taped to the front door MAIL IT.

Just my uninformed opinion:rolleyes:
Or as one poster so eloquently called me "Sh*t for brains"

mower_babe
10-26-2003, 12:26 PM
who would say something like that? :nono:

AztlanLC
10-26-2003, 01:11 PM
Mikes I know it wasn't me.
I had the same thinking mike when I started, but the only thing I was getting was more and more busy for the months of april trought may and really slow for juky-agust, most of the times I had to double cut all the lawns to get rid of the clumps, some of my employees quit on me because to beging with the season is so short and on top of that I had to cut lot's of hours during a drought, they also have families to support you know.

Most of the customers I was getting were referring more friends to me, the problem was they were just like them, the clasic my lawn doesn't need mowing this week, don't mow until I call you, are you sure your bill is right? I don't recall that many visits, don't clean up the leaves until the last one drops from the trees and so on.

So I decided going only with contracts, I lost almost half of my customers for this reason, but I only lost about 20-15% sales that year, but my quality improved because I now had more time for my customers, I wasn't concerned about spending extra time in each property during the fast growing season, my equipment was getting less abuse, my time for billing was cut in more than half, paper work too, stamps, phone calls, zero complains, most of the people that complained before was the not worth customers, those that think you have to be there only when they want and can tell you to go find other type of income during the dry months.

The only thing I regreat is not having done thies earlier, had to wait 3 years to realize that wasn't worth it, 3 years of strugle to maintain the company and employees, you don't have to be a big company to stablish this type of deal, you want your company to grow steady, is not about getting more and more customers every years, is about knowing what your income will be aech one, is knowing you don't have to pray for a good season to be able to buy that Z or whetever eauipment you're planing getting.

How many times have you mow a 12" tall grass and bent a blade, because you coulnd't see the rod hiding in the grass?, and knowing that you'll never make up for that mowing, sure $60 for mowing a property one time type of deal might sound nice until something like this happens.
Nowday most referrals alredy know the way I do business, once in a while I still get those calls "My tractor is broke, we went on vacation for a week and when we get back the grass grew 2 feet, Mow it this time and then we'll see if we like the work to commit to a contract, But my lawn doesn't need mowing during the months of july-agust, to all those type of people I simple tell, Sorry we have stablish a way to conduct business and plan to stick with it, we know the quality and dependability we offer.

This year I could've had 81 more customers but only landed 28 of those, out of the 53 I didn't get 21 were one time deals, 15 were every other week customers, 11 the price was too high, only 6 wanted the whole package deal, every week mowing, spring and fall celan up, fertilizer and snow plowing, but weren't willing to commit to a contract.

Of all those customers that didn't get I know someone else did, but what bother me is that they got someone like you who tries to please their customers no matter what, and when you realize that you have to change your practices they'll get someone new in a heart beat, someone just like you just starting out and the chain follows.

This is the way I think and I know that not everyone will agree with me, but when you truly belive in something you're not afraid to say it.

GeorgiaGrassMan
10-26-2003, 02:38 PM
This has turned out to be a great thread. I think it's hilarious that the guy who started it is swearing off LawnSite because people didn't respond to his question quick enough to suit him.

Southpaw
10-26-2003, 02:47 PM
Aztlan,

I thought your post was great. You have found your niche and are able to pick and choose your customers. I respect that very much and hope (will) do the same thing when I am able.

I am in the same boat as Mike's LL. I think he put my same thoughts on paper as if I wrote it myself. I am experiencing rapid growth but have still only turned a few potential clients down.

Stories of growth pains and learning from mistakes are great advice shared for new people like Mike and myself. It helps us to learn from others and hopefully avoid making those same mistakes. Most of my life, I learned things the hard way. I use advice now to avoid the costly mistakes by listening to other's experiences. Thanks to both of you for your posts.

mower_babe
10-26-2003, 04:39 PM
OK, costcutter. This is the part where YOU say something.;)

AztlanLC
10-26-2003, 10:05 PM
Not really I didn't find my niche I had to make my own, it's real hard to pick and choose customers believe me, but someone has to set the standars thanks to sites like this and some friends I change my mind quickly, otherwise I would still be in the same boat.

We as a community have the ability to set the standars for this type of business, we all should play in the same level, don't worry about all those scrubs or weekend warrios, take all the good examples that this site has to offer, the best way to defeat a scrub (we all are scrubs at some level) is to rise above them.

Tommy D
10-26-2003, 10:33 PM
I charge my new customers by the month, at the end of the season I offer the 12 month contract from Jan-Jan, by then we have a good relationship. They like our work and they know were dependable. The contract is an open ended contract for both parties, it also requires the customers ssn. if for some reason they need out of the contract their remaining payments are excellerated if they are moving within our service area everything stays the same until the end of the contract then we make the adjustments, This also helps to sell many of our other services that they might not purchase otherwise. It works for us and our clients

KerryB
10-27-2003, 06:06 PM
I think some of you should maybe change your outlook on contracts a little. Dont look at them as a contract. Lets say just for a moment its an outline. It shows what work you will be doing, the scope of that work, how much it will cost and how you are to be paid.
It can be just as simple as that. A couple of paragraphs. At the bottom it says that the customer is ok with the price and terms and authorizes you to do the work.
It may seem like a tedious time comsuming task thats not really worth it until, "Well you said this or you said that and I am not gonna pay.".
Even if its just something you write down as you talk with the customer and then have them sign. It will stand up in court but will probably never get that far because you have it in writting and they signed it.
Always , Always CYA even when, no, especially when your just starting out.
As for the billing we bill after the month is complete, never a prepay. If we do a big job we get a deposit.
We use 12 month billing. But again we mow 10 months and we do lanscaping year round. We offer our customers a choice of billing. A total package billed in monthly payments, or a total package with the mowing or a base service billed monthly, and add ons billed when completed. Some prefer the later some prefer the other but the key to selling any of it is to offer choices. People love choices. I will even customize a plan after talking with the customer and fiding out what fits that customer.
I think the total package billed monthly is the easier sell. They look at the monthly price and not at each service.
My contracts are open ended so they renew automatically. The customer has a 30 wriiten notice to get out and must settle up the account for whatever work has been done to date. And the 30 day notice also gives you either 30 days still on the property to find out the why and maybe correct it or at the very least a 30 day severence pay.
I know its different up north when the wind blows CCCCooolllddd. lol
But down here its not that hard of a sell for the 12 month contract especially on commercial accts.

KerryB
10-27-2003, 06:09 PM
Ps. lol Bass has an awesome program.

Christian grower
10-31-2003, 01:03 AM
GeorgiaGrassMan

I agree with this statement you have made. "It has nothing whatsoever to do with cash management for me - it has to do with cash management for the customer."

Can you e-mail me a copy of your billing invoice so I can get a better understanding of what this looks like on paper?

You said you give them a running balance each month. Their statement may say that they owe you $285, but their averaging plan calls for a $168.00 dollar payment this month. If they want to go elsewhere, they pay you the $285 and its a done deal if they want to continue, they pay the $168.00.

samuelrdavis@carolina.rr.com

GeorgiaGrassMan
10-31-2003, 10:05 AM
Christian - I would be more than happy to share that with you, but this is still in the idea stage for me. I'm trying to work out all the angles in my head so to speak. When I get it going, I'll be happy to send the paperwork with you.

KerryB - right on man - that's exactly what I'm talking about. I would classify it as an agreement rather than as a contract, but a lawyer might say otherwise.

Westbrooklawn
10-31-2003, 11:18 AM
Most of my residential contracts are set up to bill a fixed amount from March through November with 1/2 of that rate billed for Dec, Jan., and Feb. Weather permitting I will make 2 visits during each of those months to pick up sticks, blow walks and drive, etc. It is understood that sometimes weekly mowing won't happen due to weather (rain or drought), but the monthly rate still applies.

I have one large monthly residential that I set up on a single rate year round, but the contract explains in detail that if the customer cancels before the year is up (April - April contract) and accounting is made, and unpaid balances will be due.......just like a flat pay plan with the power company, etc. This makes the contract somewhat complex, but it is spelled out in detail.

Doster's L & L
11-13-2003, 03:16 AM
Guys and gals, this is the best thread that i have seen in the short time since i have been a member of lawnsite. It's because of people that want to help people that makes Lawnsite.com so awesome. i have learned a TON reading this thread. i have Copied/Pasted ideas from GeorgiaGrass Man, I am Me, Thrill, AztlanLC, and others. You guys have great ideas!!!! I look forward to implementing those ideas into my business plan.

I have an idea that may stimulate your customers to get you more new customers AND you will get more "extras" from existing customers. Tell me what you think. OK, you have a customer (Mrs. Sue) that doesn't usually go for the aerating or the grub control or they don't want the optional "extra" for any service. Do a points system for your customers. If they refer a new client (Mrs Jan) to you and they sign a... lets say a simple mowing contract. You cut Jans grass for 40/wk. This referal got Sue 16 points (40x4=160/10=16). Let's say that Jan got weed control and aerating and bushes trimmed on a contract (verbal or written) depending on your policy. you charge $2000 for the season for that. Break that down into say 10 months. That's the busy time in TN. Sue gets 20 more points plus her 16. Now she has 36 points. Guess what. Sue just made us $3440 by simply refering us to her friend. Lets say she got us 2 other customers and she EARNED (she's working hard for us folks) 39 more points. She now has 75 points. These are hers so she can spend them anyway she wants, but its our job to make sure she gets a service that she is not getting already. Give her weed control, or aerate or a discount on liming. each point is worth 1,2,3 dollars or more! You decide that part. I would probably sell the weed control hard because she can see the weeds dieing and the bermuda filling in. She hated them stupid dandelions anyway! God forbid she should see another one in the fall. She may just get you to control weeds regularly now. This is how you get new customers and get your customers to buy extras. As long as your customers feel like they're involved, i believe they will work for you.

This is something i kinda thought about a little bit, but never went into much detail about it until now. You heard it here first, my friends. Heck, i heard it here first and i'm the one that thought of it. Brainstorming is a wonderful thing.

KerryB
11-13-2003, 09:17 AM
Not bad at all. Sounds like a pretty good plan.

Lawntycoon
11-13-2003, 10:06 PM
Well .....maybe from a different point of view...what we do as far as residentials ? All of our residentials start with a basic price which includes shrubbery,mowing,trimming,blowing and bedwork. Fertilization,insectides,aeriation, etc is extra of course. The customer knows that everything will be taken care of! No questions asked (100%) also the employees are not confused about which yard gets what done ......The customer is not on contract and gets billed at the end of the month pymt due in two weeks! No pressure on them and if there money is tight? they do have two weeks! If they are late add 5%! Guess What? I normally have a 100% turn around with the customers payments being paid on time! And we are usually on there properties 10-11 months out of the year and they call us when they are ready for us to return....No Contract!