PDA

View Full Version : Big Commercial Opportunity / Small Operation !@#$%


sniggly
12-11-2004, 10:09 PM
Got a phone call tonight.....long story short......I have the better than average shot at landing a large commercial condo property. Here is what I know:

Current Servicer contracted for $78,000 per year.
12 buildings
42 cuts per year
2 fertilizations

Here is what I DON'T know:
Square footage of Turf
Linear footage of hedge
When the current contract expires
What the manpower needs would be for an account like this.

I'll know all of the above on Monday because I am going out to the property to look at it.

If you'll research my username here........you'll see what my equipment is, just add a Dixie Chopper and EBZ8000 blower. I am a solo operator and currently have 24 residentials and 2 commercials I am NOT willing to give up.

How would you approach this?

Thanks in advance yall!

BryPaulD
12-11-2004, 10:24 PM
I would look nice, have a nice notepad & sharp pencil,and a tape measure. Look for stuff that may give you fits, look at easy stuff, try to balance it together. I would keep in mind that it's a lot of work (big chunk of change) all right together, possibly for a little better deal??? What ALL do they want done mowing, fert, edging, hedge trimming, clean-ups, etc. Charge accordingly (how you may normally do it), thoughly do your "homework" measuring and what not. If props. are the same, do one and multiply the rest? But look at them good, so you really know what your up against, so you're not shorted.

Hope this helps a little, good luck :)

Green Care
12-11-2004, 10:32 PM
one thing is your going too need help with that if landed good lucks

matthew horner
12-11-2004, 10:36 PM
First, congrats on the good luck.
Second, make sure YOU can do this for 78k and that you meet the requirements or plan to (insurance ETC)
Third, do you want to??????
Matt

out4now
12-11-2004, 10:36 PM
Maybe include price of some growth regulator for the hedges and take a measuring wheel with you like already said. If you're by yourself I'd consider investing in a Flex Deck depending on how narrow and how many obstacles there are in the propert. Will it need a leaf clean-up come fall? Will you have to haul or will they let you mulch? Will you include aeration and dethatching also? How about sprinkler work? Will you have to hire someone to do it as part of your contract or will they hire someone seperate to do that? Just some stuff to consider.

matthew horner
12-11-2004, 10:39 PM
I would think you 'd be better off buying a good second hand batwing, or financing a new one if you get a 3 year or so contract as opposed to a flex deck.

HOOLIE
12-12-2004, 03:00 AM
You said you have a better than average shot at getting this...does this mean they are unhappy with the current LCO? I'd want to know why they want a change. Make sure they don't expect 100k worth of work for 78k. Numbers are both absolute and relative. 78k is a nice chunk of change if you're doing 78k worth of work.

Geezer
12-12-2004, 03:12 AM
You MUST HAVE a copy of the specifications of the contract so you can review the scope of services. You MUST HAVE have a good handle on what your COSTS are so you can PRICE your work to your desired PROFIT MARGIN. The advice you have been given to measure is dead on .... trusting that once you have the data you can use your known production rates for each aspect of the required scope of work. Once you know how many labor hours you will need to produce the work it will be easy for you do price the job. If the job requires any chemical applications (even fertilizations in many states) make sure you have the legal authority to do the work. If not, find a lawn care operation and subcontract that portion of the job.

Try not to be tempted to grab that big hunk o' dough ..... only to end up hurting your feelings and your reputation if you get in over your head.

Good Luck!

Randy Scott
12-12-2004, 11:48 AM
Try not to be tempted to grab that big hunk o' dough ..... only to end up hurting your feelings and your reputation if you get in over your head.Good Luck!

These are my thoughts as well. Don't let that big 78K number get you all wet in the panties. From your biography, and the sounds of it, you are a new guy and small company. An account like this could take you right off the map and bury you in one fell swoop. You don't have any employees, so now you have to hire more than one probably to get it done. Usually, people hire one employee at a time until they really get their feet wet to know all the headaches and expenses that come along with them. Now you would have to hire multiple help, learn new taxation procedures with them and the appropriate filing (headaches), and perform a quality job as well. Getting new employees to perform quality work and do it efficiently is a challenge in itself. You would need more equipment, trucks, mowers, etc.. You're not going to land this job and just work on it for three days out of the week. You most likely will need the manpower to get it done in a day. I don't know to many condo associations that let a service spend half the week mowing the property. So now you will need the right amount of help to get in and out of there in a day. So what do these guys do the rest of the week? Also, to learn all this new stuff on a condo association, which now you have many many people critiquing your work and employees. People with nothing but all day to pick apart what you are doing and complain to you and the association. Most big jobs like this are not all their cracked up to be.

Finally, you still have to figure an accurate bid for what it will cost you to do and make profit on it. I don't think you have that experience at this stage of the game. Nothing personal by any means, it's just that bids like this are big deals. From our experience, 99.9% of these bids are won by the cheapest guy, the association is rarely happy with service (that's because they squeeze everyones balls and scare people into low-balling to get the work). We bid on half a dozen projects a year like this to find out that we would be like 20K higher than the winning bid, so I am still puzzled on how these guys make money at them. Of course, that's why these places go to bid every year.

So, I am not trying to rain on your parade, but something like this will more than likely do more damage to your young business than good. Choice is yours though. All though it will waste some of your time, I would still go through the motions of bidding on this and it will help shed some light on how it all works though. This way you will start getting a feel for the procedures and related tasks involved and hopefully at the end you'll be the wiser for it. Honestly, without history of your business and credentials from other associations, you really shouldn't end up getting the work. If you do, I would be a little reluctant to accept it. Whatever inside info you have, there are still other members and a committee that decides who to hire. So, good luck and hopefully you'll gain some knowledge in this area. I don't know what else to really tell you. Just some things to think about.

BryPaulD
12-12-2004, 11:58 AM
I was thinking on this too. What if you can work there everyday? Like go mow it and blow it one day, trim hedges the next, edge the next, and so on? perhaps still leaving you time to do your other properties. Then they will see that you are commited to that job, there will be someone there everyday, stuff is getting done. Just a thought?

pjslawncare/landscap
12-12-2004, 01:00 PM
Sounds to me like you should either pass on this one or bid hi so if you do get it, you will profit for the head ache it will cause you. One of the top reasons for failure in this biz is growing too fast. Its tempting when its knocking on your door, but it can burn you if its too big of a step from the position your at currently. You must think about all the aspects. You will have to purchase workmans comp, do payroll, taxes, search for good workers, train them, get more equipment, ect, ect, ect. Once u commit to the job you cant go back.. Good luck in what ever decision you decide on. Let us know the final decision.

Fantasy Lawns
12-12-2004, 01:17 PM
Did they even ask you if you had Workman's Comp or what your insurance cap was ..... at $6500 per month that's a good size job ... which could even be under bid even if they have no concern if the LCO has W/C

Geezer
12-12-2004, 01:44 PM
Randy Scott, testify Brother!!! ...... WELL SAID. Especially the part about HOA goin lowball and churning through Vendors. I bid what the work is worth. Breaking even is going broke, it is just agonizingly slow.

Mark McC
12-12-2004, 03:03 PM
You said you have a better than average shot at getting this...does this mean they are unhappy with the current LCO? I'd want to know why they want a change. Make sure they don't expect 100k worth of work for 78k. Numbers are both absolute and relative. 78k is a nice chunk of change if you're doing 78k worth of work.

I think Hoolie's advice is on target. It may be that $78 grand is low for this job, or they may simply be price shopping. Might want to spend a little time talking with the person who's in charge, perhaps over lunch. It is amazing the things you can find out when investing a little time.

sniggly
12-12-2004, 08:02 PM
well......I haven't been able to meet with the condo association's head dude yet......but will. I figured I would get a personal meeting setup and pick his brain. I too am wondering about a lot of the things all of you mention here. I am concerned about growing too fast. I am concerned, probably more-so than any other subject, about my ability to do the job to MY satisfaction. The only lesson I have learned in my life, with zero headache and heartache, is that if I perform the work to my satisfaction....most everyone will be more than satisfied.

Some of the questions have to be answered in some sort of order.......the first one being - When does the contract come up for renewal? If that is 2 weeks away I am out, period. If that is two months away I might have a stab at it with proper planning.

My eyes don't really bug out at the 78,000 becuase I have no idea what the scope of work is. The numbers really mean nothing until I have had a chance to survey the property. Already have a gate code for that.

Thanks for the input folks....much appreciated to all of you :drinkup:

I'll post more follow ups to this thread when I know the information. I am sure I will have questions.

Precision
12-13-2004, 10:49 AM
Good idea Brypauld, except that it takes a LOT longer to do it that way.

4 trips is 4 times the drive time. Mow and blow day one, trim and blow day 2, edge a and blow day 3, I think you get the idea.

In Jacksonville youare looking at 42 cuts per season, 12 month season. So $78k is $6500 per month or $1800 per cut. Question is man hours. at $60 per hour for you and $45 for helpers, assuming 1:2 ratio with 2 helpers that gives you 1560 available man hours. So you can afford to spend 36 man hours per trip. This includes drive time, paperwork time, dump runs and everything.

Bottom line, if you can get 2 helpers that are decent, you can afford to spend well over a whole day there. Hopefully you could do all the mowing one day and return a different day with an empty trailer and do all the hedges.

Couple of advantages there. room for debris without mowers on the trailer. Client likes to see you on property more often than once a week. You can budget in a specific trimming schedule as opposed to trying to make it fit in with mowing. Can add that in as a service for other properties on that day to maximize dump run.

Good luck, but as others have said, HOA and the like are an nuisance.