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View Full Version : An example of Arkansas pricing


mbricker
10-29-2004, 03:13 AM
I get told once in a while that $35 or $40 an hour is way too low to sell my services. By some of you guys, I mean, not by anyone here in Arkansas, especially God forbid, by any of my customers. I agree 100%--It is too low, considering the investment and the risks of being in an independent business, not to mention the seasonal aspect.

But if I (and others here in my area) want to stay busy, I don't dare quote prices that are going to gross me much more than $40 an hour. Another thing I get told sometimes, "Don't drop the trailer ramp for less than $35." And I try not to, but I figure if I have 2 dinky, dinky $18 lawns side-by-side, (dropping the ramp just once, you see) that is better than quoting each of the customers $35 and getting no work. (20 to 25 minute lawns)

So I got a note in the mail today with the check from this customer with a dinky, dinky $18 lawn. "Mike, I will not be needing you to do my lawn next year as I have found someone else. Don't get me wrong, as I really like your work and I appreciate all you have done. But I have found someone who will also do my flower beds."

Now let me explain about the flower beds. She asked me about it and I told her I would have a friend of mine call her as his teenage daughter was interested in doing that kind of work. So they talked and he went by to look at the job a couple of days later. But when he got there he saw that the flower beds had already been weeded, the weeds thrown out on the lawn (for me to pick up with the mower, of course). So he called the customer to ask "What's the deal? Why did you have me drive over there if you already had somebody do the job?" And the lady tells him, "well I decided to do it myself but my back gave out so some of it around back isn't done and I still need your daughter."

So the guy takes his daughter over there and talks to the lady, and she says "Is $10 an hour ok?" and the guy says well I guess, and leaves his daughter and she finishes the job in about an hour and 10 minutes and goes to the lady, who says "It was an hour wasn't it? Here's your $10." And daughter calls dad and he comes to pick her up.

So when he tells me about it, I say, "Now look, you had to make 3 trips, and your daughter works an hour and 10 minutes--for a lousy ten bucks? Do you think that's very smart?" And he agrees with me that if the lady ever calls again he will tell her that there will have to be a $25 minimum... and she does eventually call, and dad tells her that, and the lady says, "Oh. Well let me think about it." and never calls him back.

So now it appears like the lady has found someone who will mow her lawn for less than $18 and weed her flower beds for $10 an hour or less.

And this is a new up-scale neighborhood. No poor people live in this neighborhood. The lady doesn't work, evidently the recipient of some good alimony or a property settlement of some sort.

Unfortunately, this is what we in NW Arkansas have to deal with often enough, that we simply won't have enough work to support ourselves if our prices start to go up. And of course, if some of you have seen that I am getting out of the lawn business, here is a major reason.

walker-talker
10-29-2004, 05:23 AM
Have you seen the recent Lawn & Landscape magazine. In there they have the State of the Industry Report. I was surprised to see the average hourly charge for residential mowing was around $40.....give or take a buck or two, depending on what region you are from. Add about $5 or $6 to that hourly charge for commercial mowing. Not that I am using this as a guide for my own service, but I found this interesting.

T.L.C.
10-29-2004, 06:04 AM
We have the same problem you have described in SW Louisiana. It seems that the commercial customer is more inclined to compensate you enough to earn a decent living, the residentials are not. Maybe that's the only way to ensure a decent living. My ratio is more residential, but due to what you just described, I think I will begin targeting more commercials & let everyone & his brother fight for the low/paying residentials. I mean to increase my ratio of commercials, I have some decent paying residentials & some like you have described. How about those customers that ask you to do "liitle extras" like trim these 5 little bushes by the playhouse with-out any additional compensation? I think we all have them....it comes with being "The Yard Man"! Good Luck!

ScCo
10-29-2004, 09:02 AM
Sadly enough I can name the neighborhood and probably even the street that mbricker is talking about. I have picked up a few properties in the neighborhood, but have missed out on a whole bunch more of them because my prices are too high for what many of the people want to pay. I net around $48 per hour on the yards I do in this neighborhood, but as I said, I have had several people who asked me for bids look at me like I'm a fool when I quote them a price for services.

What's ridiculous is in the estate section of this development the lots range from 5/8 to 1 acre and the going price on most of these properties is around $40.00. I do two of the larger lots in the estate section both of which go for $60.00 per week. There are 5 others that I had homeowners call for bids on where I was looked at like I am a fool for telling them my price.

I can only come up with one reason why I've been able to get a decent rate out of a few of the people in this development. There is one man on the POA for the development who is an absolute nut about his lawn. To coincide with him, there are a few of his friends who are fairly proud of their lawns and want them maintained a certain way, and are willing to pay the rate for doing so. The first man I mention (the lawn nut) was my first customer in that neighborhood. You can find several LCO's that will tell you horror stories about this man as he has run off many companies for various reasons when they'd do something he didn't like on his property.

That said, he has always complimented me on the way his property is maintained and on the input I give him on keeping the turf in the best condition we can. I can honestly say I've never had a problem with keeping him happy. His word of mouth to the few other customers I have picked up in that neighborhood is the only reason I'm able to do decent there.

Below is a picture of his property. It's not perfect, as I definitely am not, but it looks pretty good. And most importantly he is very pleased with how it is maintained and his "promoting" of my company is what allows us to do well inside the neighborhood

Outside of just me being lucky in this aspect, the rest of the neighborhood is almost a waste of time and effort in terms of being able to make a decent hourly wage. The place would be a gold mine if it hadn't been hit so hard by low ballers when the developing first started...now as mbricker says, there's simply not much there if you want to make money.

--ScCo

ScCo
10-29-2004, 09:05 AM
by the way, the yard in the picture is zoysia grass. I had a picture of it from a brighter day at one point, but I don't know what happened to it. The home owner took up all of the tifway bermuda when he bought the home and installed the zoysia himself.

Anyhow, the stripes aren't really bold, but for a warm season turf with a pretty short cutting height, they're ok.