midwest fall clean up pricing

[elegantlawns]

wondering what others in the midwest are charging for fall clean ups hourly or other ways? and also what your clean ups consist of iam offering mulch leaves weekly and continue charging mowing price or blow beds and bag the lawn based on how long i think it will take to perform the task any other ideas appreciated

[orangemower]

You can't base your price off what others charge. If you know your true cost of doing business then you shouldn't have any problems working up a price.

A hint for you. Don't bother cleaning out the flower beds until the leaves are about done falling. Save them for the final clean up.

[elegantlawns]

Originally Posted by orangemower

You can't base your price off what others charge. If you know your true cost of doing business then you shouldn't have any problems working up a price.

A hint for you. Don't bother cleaning out the flower beds until the leaves are about done falling. Save them for the final clean up.

I've been told by others to try and figure out the going rate in my area that way I can price competitively. how do you figure your true cost of doing business? not looking for smartass answers iam a new business owner seeking advice. I've worked for a company doing lawncare and some landscaping for roughly 4 years now but this your own business thing is a little different. any other tips tricks or advice welcome thanks.
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[slapon]

Originally Posted by elegantlawns

I've been told by others to try and figure out the going rate in my area that way I can price competitively. how do you figure your true cost of doing business? not looking for smartass answers iam a new business owner seeking advice. I've worked for a company doing lawncare and some landscaping for roughly 4 years now but this your own business thing is a little different. any other tips tricks or advice welcome thanks.
Posted via Mobile Device

I'll see if I can help. To figure your true cost of doing business, you will need to take inventory of everything necessary to complete the job, which will include tools, vehicles, labor, gas, insurance, etc.. There are the direct (variable) costs, such as fuel and labor, which will be easy to allocate. Indirect (fixed) costs, such as tools, vehicles, facilities, insurances and the like are more difficult, but you will need to allocate them on a pro-rata basis (pro-rata>an allocation of fixed costs based on a weighting of all jobs the fixed costs are used to support). It is essential that you build your fixed costs into your pricing because eventually you will have to replace your equipment , make payment on rent or insurances, and you will need to have the resources available.

When determining the true costs of tools, vehicles and other tangible assets, you will need to determine a cost of capital. You will need to know what your cost is to employ that capital. So, for instance, you buy a vehicle and borrow 100% of the money from the bank. Your cost of capital is probably going to be similar to the payments you are paying the bank. This will include both the interest cost and principal payments. Doing this will match your cash inflow with the outflow.

If you have to use some of your own money, then the cost of capital will generally be greater than the bank's lending rate. The cost of capital should be similar to what you would expect to receive from a similar risky investment, which probably will be in the 15% to 20% range. This rate should represent what an investor would require in return for investing in the business. Once you have gotten a handle on your tangible and intangible costs, make sure you charge an appropriate amount for your labor and other direct costs.

I hope this helps you out for your business, and, now, if I may, I would like to shamelessly promote my product, the Slap-on attachment. I am a sponsor of this site, so please check it out at www.slapon.net. Good luck with your business.

[32vld]

If you need to charge $60 hr to cover expenses and make desired salary you never tell the customer you want $60 hr. There will go crazy $60 to rake leaves? I'm not looking to have brain surgery.

So if you think the job will take 4 hrs you just tell the customer $240 for the job.

Yes you need to figure your business costs. Rent, insurance, gas, budget for repairs, set aside money to replace equipment when it wears out. Money to expand services by getting new equipment that you don't own at this time, etc.

So if your costs spread out come to $20 hr and you need to earn $20 salary,
you need to charge $40 hr.

But you do need to know what the other LCO's are charging in your area. You don't want to low ball, which is bad for the industry. It just depresses the area's prices and makes it very hard to get them back to where they were.

Then if your area LCO's are charging $60 hr and the clean up takes 8 hrs the bill will be $480. Now if you charge $40 hr and do the same job the bill will be $320. You not only low balled, you left $160 of profit on the table.

This shows that contrary to what has been said to not know what the industry charges in your area is needed to not only prevent you from leaving money on the table it will show you that if your costs to do the work is $80 you will not get any work because the same job would cost your customers $640. So either you have to find away to lower your costs to be competitive. If you can't then you know that you should not start a business at this time.