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Old 03-28-2003, 03:27 AM
JimLewis's Avatar
JimLewis JimLewis is offline
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How to win at the LCO game

Ok. I decided to post this because I see a lot of people here posting about how it's difficult to compete with lowballers and how they're basically having to lowball themselves in order to survive. And I wanted to share a few points with you all about how to avoid having to do business that way - How to demand higher prices and get them.

It all has to do with your company image and how much respect people have for you. First of all, you need to realize that there are people everywhere, in every community who WILL pay higher prices, if they perceive a higher value. I don't care what your economy is like and what the competition is like. I live in Oregon, where we have the highest unemployment rate in the nation! And where I pass dozens upon dozens of LCOs every day. It's been like that for years. Every single day I see another LCO I never saw before. There are 3 in just my little sub-division. And that's just the ones I know of. Scrubs as well as pros all over the place. Competition is fierce here and our economy is in the dumps. Yet, I can still show up to a client's house, give them an estimate that is in the high end of the spectrum, and still land 75% of my bids, despite the fact that we charge quite a bit more than other companies do. Here is why......

First, for years and years I've tried very hard to develop a strong company image. Our trucks stand out from a block away. And we've always got several of them driving around town - all looking identical. You can't miss us when we drive by. And over time, people get our image impressed in their brain. Our employees have nice uniforms, hats, etc. So everyone around here now knows who we are. And that's half of the game right there. And what's great is MOST LCOs DON'T GET THIS! Marketing and creating brand imaging is generally most LCOs biggest weakness. Well, it's my strength. So we've just blasted past most companies because we've created a recognizable brand image in people's minds. This is key.

Second, it's not just the trucks and uniforms; it's the whole picture. I try to make everything we do stand out from the competition. Our web site is top notch, our estimate forms are very professional, I try to go out of my way to be very sociable with clients, our business cards are the best around, we strive to do excellent work, we try to leave every customer satisfied, we try to always look as neat and clean as possible, and on and on. It's a business philosophy that says we're going to try to be better at everything than the other LCOs are. Whatever is standard, I try to take it a step further. It's a whole image - an entire package. So that when a client looks at all of these things they get a feeling like you one a seriously professional outfit.

Third, I charge more than many LCOs do but I also try to INCLUDE more. Just a few extras that most don't include do the trick. A typical LCO might mow, blow and edge for $20 per week. Well, we'll mow, blow, edge, control weeds in the lawn, fertilize, control moss, etc. all for or $30-$35 per week. Not a big difference per week but that's $40-$60 more per month for us for each account. For $40-$60 more, I am happy to throw in a few extras. People get the impression that YES, we're a little higher, but look at what it covers!

Fourth - referrals are very important. As we've grown, and have had hundreds, even thousands, of satisfied customers, we've created a huge group of people to give us leads. A great deal of our new business comes from referrals. (something that took years to happen.) And when you get a person who just raves about your company, it doesn't matter what Joe Blow charges. THEY WANT YOU!

I guess what I am trying to say is that a lot of this business has to do with image and reputation. But if you're still out there driving around in only one truck and it isn't lettered, or poorly lettered, and you aren't doing much else to stand out from the competition, you're just going to be one of the herd! You gotta do MORE than the others if you expect to get better results.

I have friends, other LCOs, right here in my own city bitching about the same things you all are bitching about....."Man, too many lowballers around here." "My customers want me to do all this extra stuff for free." "I can't seem to land many jobs." "I am not getting very good results from my flyers." and on and on and on. And I am always thinking to myself, "Hmmm. That's odd. I very rarely experience those problems." But when I sit back and think about it - there's a reason why. These other LCOs are "nobodys" to the general population around here. They don't know these guys. They've never heard of them. Their trucks don't stand out as anything they've ever seen before. They don't seem to be very professional. They don't appear to have anything special at all. So to the potential client, their just another LCO with a truck and a mower. And when that's all you are - you have only one way to compete - and that's to be the lowest price.

But when you've taken time to establish a well respected business, you can charge what you need to charge, demand more for your work, and get it! And what's more - you will find that the people you deal with are easy to deal and and anxious to have to working for them.

The clientele who you are all looking for isn't calling you or choosing your bids because they haven't any reason to! And many of them don't trust flyers nearly as much as they do a referral from a trusted friend. I am not knocking flyers here. We all know that with enough flyers, you'll eventually get calls. But I am saying that if the person reading the flyers is thinking, "Oh yah! I've seen those guys around! I think they do work for John and Linda down the street! Maybe I should call them." THEN - you're flyers are going to be TWICE AS EFFECTIVE!

A referral is far and away the best kind of advertising and lead you could ever get. But even if you don't have that, brand name recognition is the SECOND best thing you can have going for you. And if you don't have either of these things going for you then all you have is your price. And THAT'S why you keep having problems.

There is a certain group of people out there who are willing to pay more money as long as they perceive they're getting more for their money. And you're whole image will make or break that perception.

I don't know how else to explain it. Hopefully this helps some of you.
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Jim Lewis
Lewis Landscape Services - Oregon
"kickin' grass and takin' names"


www.lewislandscape.com - Portland Oregon Landscaping Company

landscape design Portland Oregon

Last edited by JimLewis; 03-28-2003 at 03:37 AM.
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  #2  
Old 03-28-2003, 04:04 AM
iowapride iowapride is offline
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Location: Iowa
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Jim

I agree 100% with everything you just said. This year especially I have heard 9 times out of 10 while doing a bid, "I saw your trucks running around town a lot last year."
I was just talking to one of my employees yesterday on how I believe image is so important in a business. I take pride in my business and I feel my trucks and equipment show it. 2003 Chevy 2500HD Diesel, 2000 Chevy 2500, 1998 GMC 3500 Dually, and a 1996 GMC 3500 Dually. All trucks are white with the same decal package.
The envelopes I send out have my colored logo on the return address along with return envelopes for the customer to send back. All my employees where the same hat, T-shirt, or sweat shirt, depending on the weather. Company policy: No jeans or shirts with holes in them.

Don't get me wrong, the quality of work and references and word of mouth has a lot to do with success, but if a client called 3 LCO for bids, and a brand new truck pulled up, who would you choose. Image is expensive, but IMO it works along with quality work.
As far as competition goes: There are 2 other LCo in a town I offer services in. They both have full time jobs, people see my truck at all hours of the day, their truck is not lettered, if they put an ad in the local paper, mine is ten times more professional and usually a bit larger. Like Jim mentioned, charge more but offer more. For example, leaf collection. I'm usually higher. My selling point is: I haul everything away where the comp wants to dispose of it on the yard. It works along with quality and the way a business is run.
This is not to offend anybody by what I said, this is just what has worked for me.
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Old 03-28-2003, 07:54 AM
John Allin John Allin is offline
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Jim,
Well put... well said.
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  #4  
Old 03-28-2003, 08:34 AM
Randy Scott Randy Scott is offline
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Join Date: Nov 2000
Location: Wisconsin
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Re: How to win at the LCO game

Quote:
Originally posted by jimlewis
Ok. I decided to post this because I see a lot of people here posting about how it's difficult to compete with lowballers and how they're basically having to lowball themselves in order to survive. And I wanted to share a few points with you all about how to avoid having to do business that way - How to demand higher prices and get them.

It all has to do with your company image and how much respect people have for you. First of all, you need to realize that there are people everywhere, in every community who WILL pay higher prices, if they perceive a higher value. I don't care what your economy is like and what the competition is like. I live in Oregon, where we have the highest unemployment rate in the nation! And where I pass dozens upon dozens of LCOs every day. It's been like that for years. Every single day I see another LCO I never saw before. There are 3 in just my little sub-division. And that's just the ones I know of. Scrubs as well as pros all over the place. Competition is fierce here and our economy is in the dumps. Yet, I can still show up to a client's house, give them an estimate that is in the high end of the spectrum, and still land 75% of my bids, despite the fact that we charge quite a bit more than other companies do. Here is why......

First, for years and years I've tried very hard to develop a strong company image. Our trucks stand out from a block away. And we've always got several of them driving around town - all looking identical. You can't miss us when we drive by. And over time, people get our image impressed in their brain. Our employees have nice uniforms, hats, etc. So everyone around here now knows who we are. And that's half of the game right there. And what's great is MOST LCOs DON'T GET THIS! Marketing and creating brand imaging is generally most LCOs biggest weakness. Well, it's my strength. So we've just blasted past most companies because we've created a recognizable brand image in people's minds. This is key.

Second, it's not just the trucks and uniforms; it's the whole picture. I try to make everything we do stand out from the competition. Our web site is top notch, our estimate forms are very professional, I try to go out of my way to be very sociable with clients, our business cards are the best around, we strive to do excellent work, we try to leave every customer satisfied, we try to always look as neat and clean as possible, and on and on. It's a business philosophy that says we're going to try to be better at everything than the other LCOs are. Whatever is standard, I try to take it a step further. It's a whole image - an entire package. So that when a client looks at all of these things they get a feeling like you one a seriously professional outfit.

Third, I charge more than many LCOs do but I also try to INCLUDE more. Just a few extras that most don't include do the trick. A typical LCO might mow, blow and edge for $20 per week. Well, we'll mow, blow, edge, control weeds in the lawn, fertilize, control moss, etc. all for or $30-$35 per week. Not a big difference per week but that's $40-$60 more per month for us for each account. For $40-$60 more, I am happy to throw in a few extras. People get the impression that YES, we're a little higher, but look at what it covers!

Fourth - referrals are very important. As we've grown, and have had hundreds, even thousands, of satisfied customers, we've created a huge group of people to give us leads. A great deal of our new business comes from referrals. (something that took years to happen.) And when you get a person who just raves about your company, it doesn't matter what Joe Blow charges. THEY WANT YOU!

I guess what I am trying to say is that a lot of this business has to do with image and reputation. But if you're still out there driving around in only one truck and it isn't lettered, or poorly lettered, and you aren't doing much else to stand out from the competition, you're just going to be one of the herd! You gotta do MORE than the others if you expect to get better results.

I have friends, other LCOs, right here in my own city bitching about the same things you all are bitching about....."Man, too many lowballers around here." "My customers want me to do all this extra stuff for free." "I can't seem to land many jobs." "I am not getting very good results from my flyers." and on and on and on. And I am always thinking to myself, "Hmmm. That's odd. I very rarely experience those problems." But when I sit back and think about it - there's a reason why. These other LCOs are "nobodys" to the general population around here. They don't know these guys. They've never heard of them. Their trucks don't stand out as anything they've ever seen before. They don't seem to be very professional. They don't appear to have anything special at all. So to the potential client, their just another LCO with a truck and a mower. And when that's all you are - you have only one way to compete - and that's to be the lowest price.

But when you've taken time to establish a well respected business, you can charge what you need to charge, demand more for your work, and get it! And what's more - you will find that the people you deal with are easy to deal and and anxious to have to working for them.

The clientele who you are all looking for isn't calling you or choosing your bids because they haven't any reason to! And many of them don't trust flyers nearly as much as they do a referral from a trusted friend. I am not knocking flyers here. We all know that with enough flyers, you'll eventually get calls. But I am saying that if the person reading the flyers is thinking, "Oh yah! I've seen those guys around! I think they do work for John and Linda down the street! Maybe I should call them." THEN - you're flyers are going to be TWICE AS EFFECTIVE!

A referral is far and away the best kind of advertising and lead you could ever get. But even if you don't have that, brand name recognition is the SECOND best thing you can have going for you. And if you don't have either of these things going for you then all you have is your price. And THAT'S why you keep having problems.

There is a certain group of people out there who are willing to pay more money as long as they perceive they're getting more for their money. And you're whole image will make or break that perception.

I don't know how else to explain it. Hopefully this helps some of you.

Some will just never get it! Let 'em struggle then. They obviously don't have what it takes mentally. These guys mowing lawns in jeans and Nike t-shirts make my business that much better.
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Old 03-28-2003, 08:53 AM
Dependable Lawncare Dependable Lawncare is offline
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Join Date: Feb 2003
Location: Missouri
Posts: 84
First of all I agree in principal with everything you said. It is a great business philosophy.

Secondly, it is unrealistic to suggest that a new LCO can shell out that much money to start out.

I struggled to buy an old 85 Dodge truck, a trailer, a new exmark wb, a blower, a trimmer, a used hedge trimmer, a Toro trim mower, etc. And I still owe on the Exmark. I am starting out in the hole. I have 5 accounts so far, and I will be lucky to break even this season unless things change dramatically.

You are saying that if I got a loan for a $30,000 truck, spent $500 on custom lettering, spend extra money on custom stationary, uniforms, hats etc. that I would be doing better. C'mon.

If you start out spending all the money you are suggesting you are going nowhere but down. That's the real world. The situation you are speaking of must evolve over time to be successful. Just thought I'd ad that bit of reality.
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Old 03-28-2003, 09:06 AM
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FrankenScagMachines FrankenScagMachines is offline
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Very well put Jim! I'm just curious how a part timer (but not scrub/lowballer) is going to be able to get that kind of exposure and name recognition if he only has one vehicle out maybe 10-15 hrs a week spread out over a couple days? Any ideas?

I have a deal going: first cut free to all new regular customers. Lawns over 22,000 sf, overgrown lawns, lawns in need of cleanup, etc. do not apply but will be given $20 credit toward mowing or cleanup. That is my deal advertised on the flier. This may be considered a lowballers approach but I see it as more bang for your buck. I also put on there that if they do not choose to hire me, they will be billed for that cut. I feel that this way they can see the quality of work I do and they get a good deal that cost me very little. That one free cut, if say it's for $25, would make up the difference of the competition's price of $1 more over the entire season. So maybe I could charge another $1 per cut and come out even :blob4: they would still feel like they got a good deal because they got something for free!

Dependable lawncare- I think he means once you get on your feet work toward that stuff. If you charge fair prices from the beginning and get good word of mouth advertising then you're off to a good start A good flier/biz card, etc. is helpful. Vinyl cut signs for your truck are not too expensive and you can print your own T-shirt transfers from home.

Thanks for a wonderful, very informative, very encouraging post!

Eric
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Old 03-28-2003, 09:15 AM
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T.E. T.E. is offline
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Location: Tulsa, Claremore, OK
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Jim I agree whole heartedly with what you said that approach will solve most all of the problems that are in the lawn & landscape business. I'm not up to speed on everything yet but that is where I aim to be in the future. Just one thing I looked at your website what size lawns are those that you are offering 135. to155. a month? Thanks T.E.
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Old 03-28-2003, 09:34 AM
Gravely_Man Gravely_Man is offline
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Jim, as always you provided a great and informative post. Hopefully this post will stay at the top for a while and help a lot of people out.

Gravely_Man
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Old 03-28-2003, 10:19 AM
Toroguy Toroguy is offline
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Excellent points Jim,

Perceived image is a big part of the business.

Is a competitive price more important than image?

Are reliability and results more important than image?

I believe that reliabilty, quality work and competitive pricing create their own image. Catchy logo's, uniformed personnel, distinctive vehicles and equipment can enhance an image, not create one.

For those wishing to expand, your idea is valid, and worthy of imitation.

As a sole proprietor expansion and image are a less significant concern. I have not advertised in any form for three years. All new business has been from referrals only.

My 13 year old truck is well maintained and older than some of the people on this site. It is not a billboard, it hauls brush in the bed and pulls my trailer. It will serve me and my customers for seven more years, when I will place "collector" plates on it and replace it with another used two wheel drive full size truck.

Perceived image costs money, real image is earned. I'm cheap, I have earned my image.
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Old 03-28-2003, 10:25 AM
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JimLewis JimLewis is offline
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Quote:
You are saying that if I got a loan for a $30,000 truck, spent $500 on custom lettering, spend extra money on custom stationary, uniforms, hats etc. that I would be doing better. C'mon.
No. Apparently you haven't been paying much attention to my other posts. That's fine. I'll explain. Our trucks aren't 30K trucks. I never said you had to have super nice brand new trucks. In fact, I think it's stupid to try to go buy a bunch of expensive trucks for this business. Our trucks look like this;
http://www.cybcon.com/~jimlewis/chevy.jpg

They cost me around $2k usually, $1K for a paint job and $125 to get the lettering put on. But all 4 trucks we have in our fleet look exactly like that. Same year, same paint, same logo, etc. You don't even have to have the same year truck. That's just my thing. But same paint job and logo on every truck begins to stand out. And it doesn't have to cost $30K.

I never spent money on custom stationary. Most of you have a nice enough computer and printer to print up some decent estimate forms. Just use regular paper. They don't have to be fancy, just professional and stand out.

As for uniforms, I'll pay $200-$400 per order. And that outfits 4 guys. So that's not expensive either. And I was doing all of this even BEFORE I could afford to do it. I just realized that it was necessary if I ever wanted to have a big business.

I've always had a can-do attitude. If I didn't have the money to do what I wanted to do, I found a way to do it cheaper. But I always found a way. Your whole attitude that it's going to cost you a fortune to look professional is what's wrong. It doesn't have to be that way. Well, not after you get established anyway. Maybe your first year or so I can see not having these things. But after that, most of you could afford to look good. You just choose not to.
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Jim Lewis
Lewis Landscape Services - Oregon
"kickin' grass and takin' names"


www.lewislandscape.com - Portland Oregon Landscaping Company

landscape design Portland Oregon
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