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lawnranger44
03-22-2004, 01:48 PM
How many of you guys raised prices already? We raised the average lawn 2-3 bucks, mostly because of gas prices and since they are expected to go up even more. Anybody ever lost a customer due to a small increase like this?

robin 2
03-22-2004, 01:56 PM
I already raised the prices. The increases were $5 and I did not lose any customers.

C4chris70
03-22-2004, 03:22 PM
I am raising prices an average of $5 per month as of April 1. I have only lost 2 customers in the past due to price increases. With the price of fuel still going up as well as high insurance costs, the increase is necessary.

CharlieBingo
03-22-2004, 05:08 PM
Never be afraid to raise prices. Those that drop a good service over a couple of dollars are bottom feeders. Do less work for more money. Takes most of us years to learn this.

DUSTYCEDAR
03-22-2004, 05:09 PM
i raised um and only lost 1 so go 4 it

bobbygedd
03-22-2004, 05:39 PM
i raised them $2-$3 bucks each. havn't told em yet, won't tell em till i'm done cutting

dfor
03-22-2004, 06:18 PM
Definitely raising prices again this year. Haven't decided how much yet. Prices need to be raised every year. Everything else goes up, so should we.

CamLand
03-22-2004, 06:20 PM
raised all and no complaints...

justmjc
03-22-2004, 08:14 PM
Hey, I have a question about raising the prices. In your opinion, wouldn't it make sense not raise prices and almost guarantee a renewal next year vs raising prices and losing a few accounts? I see the price increase makes up for it, but look at it from this point of view.

Do you want to continually expand keeping $25, $30, etc accounts and to keep adding each year?

Or, do you want to only maintain top doller accounts? I think prices can only go so high, before your eventually undercut by someone. Loyalty is only to an extent.

So, if you keep your prices at market rate or slightly above, you consistently expand without really losing anyone. I suppose it's a matter of if you want accounts that are premiumly priced vs. potentially more volume in each year. If you lose 5 accounts a year, that's 25 in five years, and it all adds up. I'm not saying don't raise prices, just not as high or as often. Does any of my concept make sense?

Any ideas or comments?

lawnman_scott
03-22-2004, 08:28 PM
Originally posted by justmjc
Hey, I have a question about raising the prices. In your opinion, wouldn't it make sense not raise prices and almost guarantee a renewal next year vs raising prices and losing a few accounts? I see the price increase makes up for it, but look at it from this point of view.

Do you want to continually expand keeping $25, $30, etc accounts and to keep adding each year?

Or, do you want to only maintain top doller accounts? I think prices can only go so high, before your eventually undercut by someone. Loyalty is only to an extent.

So, if you keep your prices at market rate or slightly above, you consistently expand without really losing anyone. I suppose it's a matter of if you want accounts that are premiumly priced vs. potentially more volume in each year. If you lose 5 accounts a year, that's 25 in five years, and it all adds up. I'm not saying don't raise prices, just not as high or as often. Does any of my concept make sense?

Any ideas or comments? Couldnt you just expand with $27 to $32 accounts about as good as with $25-$30 accounts? They are the same lawns. No one mentioned outragous price increaces. Prices going up are just a fact of life, and people have to understand and deal with it. Sure some wont, but most will.

JFGLN
03-22-2004, 09:03 PM
I raise my prices every other year.

qualitylandscaping
03-22-2004, 09:35 PM
^ $2.50 for lawns under $50.00.. ^ $5.00 for lawns over $50.00..

impactlandscaping
03-22-2004, 09:37 PM
We raised ours by $ 12-25.00 per account per month, and also add a mandatory fuel surcharge of $ 4.00 per month per account. No refusals over the last three years. That is a measure of a quality minded customer base, rather than a price minded clientele.:D

lawnworker
03-22-2004, 10:17 PM
I am going to freeze my rates for next year. Some people I have now are at the top of the market now. Raising them anymore would be to risky. In these type situations, it is best not to raise rates for a few years.

Four Star
03-22-2004, 11:00 PM
Raised prices by $2, lost one. He is the cheapest person I'll ever know. No big loss for me though. Haven't heard back from anyone else yet.

ranger520
03-22-2004, 11:16 PM
Being gas prices have stayed fairily stabble in our area, I put a surcharge to be added in the event that gas prices increased over a certain amount. It works out to like $2.50 per week. I wrote it into the contract and informed my customers of it and no one seemed to have issue with it.

dvmcmrhp52
03-22-2004, 11:29 PM
Everything went up this year.

workaholic
03-23-2004, 10:46 PM
Originally posted by CharlieBingo
Never be afraid to raise prices. Those that drop a good service over a couple of dollars are bottom feeders. Do less work for more money. Takes most of us years to learn this. VERY WELL SAID...

tiedeman
03-23-2004, 10:58 PM
I raised up all of my rates. My non-mowing rates went up a lot

jeff_0
03-24-2004, 01:06 AM
I went down on a few this year.. yeah down... one townhouse community i cut i was charging $350 a cut last year. i could do it in 2 1/2 hrs by myself. I went down to $300. One guy has 13000 sq ft of land and i was charging him $50 but now $40. And the last one i went down on was one that I was charging $105 a cust takes my 1 hr 45 minutes to cust by myself.. I went down to 85 (now he wants me to do the mulching) i've been using a 48 inch bobcat z rider. I'll probably buy a 61 inch exmark this year. I'll save more time. Yeah i didn't have to go down. But i wanted to make my prices more inline with the other customers i have.

jeff_0
03-24-2004, 01:09 AM
I did go up on one $5 per cut. i was doing 2 1/2 acre for $130 and now $135.

billc
03-24-2004, 10:11 AM
Why raising everyone's prices may actually LOSE you money

If you know the amount you need to make per hour to hit your financial goals, then you should consider raising the rates of those accounts where you makle LESS than that rate and leave the accounts where you make more alone.

Example: You need to average $45.00/hour to cover all your expenses including equipment, salaries, gross profit, etc.

IF YOU TRACK TIMES SPENT ON THE JOB you will know how much you're making per hour for every customer.

Customer A averages $52/hour and Customer B averages $32/hour. If you raise everyone, you risk A getting new bids and losing him whereas if B gets bids, you may still be the cheaper. The result? You risk losing your higher-paying customers and keeping the ones who pay less - which means you risk LOSING money as a company. Just raise B's price and you have two possible outcomes - he accepts the raise and you stop losing money or he does not accept the raise, you lose this customer and you stop losing money.

PROCUTSLAWNCARE
03-24-2004, 04:17 PM
Billc, very well said!!!

Question though? How do you raise them. Jump on the phone and say surprize your going up 5 bucks this year. Or type out a nice letter and send it to them explaining that gas insurance tax and eq. price have skyrocketed? I dont know. Ive been in business for 5 years now and I havent raised a single customer yet. I have some customers that Ive been doing since high school. And let me tell you what, im tired of getting taken advantage of. All my customers are going up 5 bucks this year.

My one friend said it best. Why bust your a$$ and lose money when you can sit at home and do it sitting in your chair watching TV????

Any ideas on how I should let them know????

Mdirrigation
03-24-2004, 05:54 PM
But if you look at prices over the long haul , 20 years the prices realy havent risen , in 1985 the adverage minimum around here for a residential was $ 25.00. Today the adverage price is $ 25.00. I raised my prices every year and rarely lost customers due to that. I would lose $ 50.00 lawn bids to new guys who bid $ 25.00 . Thats why i sold my grass accounts to my foreman , he couldnt belive the prices I was getting , and I was paid well for the accounts.

If I had the time I would like to sit down and adjust that twenty year old $ 25.00 minimum and make all the adjustments for inflation and see what it should be in todays dollars. I do know that my house in 1985 was 50 thousand , today it would sell for
$ 225.000 , Gasoline was about 80 cents a gallon , my f 250 diesel ford 4x4 pick up was $ 11,700.00 brand new .