Originally Posted by BetterLawns&Gardens
I am new to the lawn care business. This is only my second year, and I am obviously still learning. Right now it is just me doing the work on my own, and sometimes my husband helps. Next year I plan to purchase a separate truck and hire someone to help me. So because of that I do all my estimates as if I have two people out there doing the work and if I were paying them.
I recently quoted a property and when i told the lady what the price was she about had a heart attack. I didn't quite understand why until after I cut and she paid. she told me that she had contacted 5 or 6 other companies and they quoted her between 40-50 my quote was 20. How do I react to that?
I came up with the price using a system that I figured out based on internet research. Measuring the yard, figuring out the expense of cutting it, total business costs, time to cut the yard, and what i would pay employees. I figure when I do hire someone I would pay a driver (me) 10 per hour, and a helper min wage which is 8.50. Based on that i figured it would take me approximately 45 mins or so to cut by myself and with a helper it would take about 30 or so which i came up with 20 and that is about what i charge everyone with that same sized yard.
I figure either I am planning to pay an employee way too low or my costs are way lower than theirs. The one company that she said was the most expensive I see signs around town everywhere so they are obviously getting people to pay these prices, however they seem to me to be ridiculously high.
What do I do about this? Am I loosing way too much money charging these cheaper prices when everyone else is making double or more? Or do I keep them lower to get more yards and make more money in the long run because I have more work to do? Any advice is greatly appreciated.
Here's my problem with this, you're in business, but you dont know anything about being in business. Took no courses, never worked for someone else doing this kind of work, you just decided one day to walk into our line of work and screw it all up.
do you know what it means to recover over heard? Do you know what a profit and loss statement is? Or how to read one? Better yet once you can read one, have any idea how to make changes with the information you have?
It takes time to drive to a property, unload, reload. All that, just to show up will cost more than $20.00. You are not recovering your time properly.
furthermore who do you know that can make a living, only PART of the year earning minimum wage? McDonalds is a better job than working for you. They pay you year round, and will pay an average of $9/hr with rapid advancement, can hit $11 in the first year easy.
Clearly your husband pays for your household/family to exist with his job, because you can't support a family on what you are even paying yourself.
Your 'estimation' and sales are a train wreck.
I pay my base guy who has never done this before and needs training $11/hr and top crew chief $18/hr.
I carry a million in insurance.
workers comp, do you have that?
commercial liability do you have that?
Do you have a business license with your municipality/state?
LAst week I bid on a $50,000 municipal lawn contract (at least that was MY number) some joker who was with us for the walk through pre bid, goes up and asks the purchasing agent, "do you know where I can get a chemical license?"
I butted in and told him, hey man if you don't have one of those you dont have any business bidding accounts like this.
He gave me the evil eye like I didnt know what Im talking about, and I told him, if you beat my number I will challenge your bid as non responsible and request it be made non responsive in post bid, due to you not having the proper license and experience. He then gave me two evil eyes, until the purchasing agent told him...you know, he's right, and if he challenges your number, he will win, and Ill be forced not to consider your number.
You can't just go and do stuff one day because you have an MTD and a pickup truck, and you read something on the internet.
Let me ask you, WHY don't YOU go work for a lawn company and offer to work for them for minimum wage? At least then you can learn the business, from the ground up? What qualifies you to be a 'business owner' and have the audacity to expect to pay SOMEONE else minimum wage?