Old 07-01-2010, 02:09 PM
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Location: Red State America
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I see the concept but how does the money work?


So you give away the controller and make money on the water savings. How do you establish the baseline? What if we have a drought and you go over? It seems fraught with potential headaches but maybe there is a method.
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Old 07-01-2010, 04:48 PM
SoCalLandscapeMgmt SoCalLandscapeMgmt is offline
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yeah.... I'm not a master of strategic business plans by any means but I don't see how this guy is going to survive! His clients are only going to see their reductions in the first full year of use.... after that their use should stabalize and remain low.... so unless he gets the savings for the entire first year I don't see how he will make much money!
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Old 07-01-2010, 07:04 PM
djt22 djt22 is offline
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"Drake said he knew his concept would work because it didnít require an association to spend $200,000 for the multiple irrigation controllers needed on the property. Instead, his company would give them away at no upfront cost, and his company would make money from the savings on their water bills."

I could be wrong but in reading this I got the feeling maybe he is being paid for the controller and his services at the end of the year with the money left over in the budget. So if the HOA normally spends $40,000 a year on water and he saved 50%(just for easy numbers) he saved them $20,000 (before he got paid) They then pay him out of the $20,000 he saved and so the first year is not a true $20,000 savings maybe only a $10,000 savings?
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Old 07-01-2010, 07:11 PM
SoCalLandscapeMgmt SoCalLandscapeMgmt is offline
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That's fine... he gets paid for the first year and the cost of the controllers. But what about years 2 through whenever? Somebody has to pay for the airtime and for his signal service. Is he just going to give that away indefinitely after he gets paid for the first year? That's the part that I don't see as being sustainable for the company for the long haul. It's almost like a pyramid scheme.... It will work fine as long as he can bring in new clients every year but what happens when that stops? It's not like he is the only guy with a weather based system out there.
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Old 07-01-2010, 07:46 PM
bcg bcg is offline
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Maybe it's a free hardware with an x year commitment to his management services at $y per year plus a one time payment of x% of your first year water savings to cover hardware. That would seem doable. He's got to have some ongoing revenue from the sites or it's not worthwhile. If annual management fee is say $5,000 and he saves them $20,000 in water the 1st year then it's a win win.
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