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Old 01-26-2010, 10:44 PM
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Premier landscaping south Premier landscaping south is offline
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Commercial VS. Residential

Going full time this year(solo) and going to hit the advertising thing pretty hard this year. I am legit and ready to uphold the integrity of the industry, with professionalism and keeping rates fair and balanced.

I am going to focus on residentials. However during the coarse of the this season and next I may be asked or come across some commercial opportunity's.

Being a young business and not having a solid fiscal foundation, every payment and receivable is important to me and my family. I have good on time clients now and all are residential. I have a good relationship with all of them. So I like the idea of keeping residentials as my focus. Plus I do not think I have the experience or know how to deal with a larger commercial account details such as contracts, bonding and price quoting.

My wife works for one of the big three auto company's in their credit division and does a lot of collecting on delinquent accounts. She warns me that she deals with a lot of Landscapers and construction co's. The largest problem with the late payments is their account receivables are behind. I believe they are larger lco's because they say that they can't make payment until they receive a $5,000, sometimes a $20,000 receivables and so on.

Commercial vs. residential which one is more likely to have slow or non paying receivables?

I would like to get a grip on this in order to complete a short term business plan. Thanks and good luck to everyone this spring. Be safe.
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Old 01-27-2010, 12:11 AM
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Good luck!! Last year was when I went full time. I was also solo its hard a lot of work and not a lot of money. If you can me the first year you should be ok.
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Old 01-27-2010, 07:06 AM
Oldtimer Oldtimer is offline
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Remember, you, have to keep up with your paperwork. Don't let customers get behind because you can't afford to miss collecting for any services performed.

There are men in business and businessmen.

If owning and successfully operating a business was easy, everyone would be doing it.


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Old 01-27-2010, 01:38 PM
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Premier landscaping south Premier landscaping south is offline
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Thanks for the encouragement guys.

Is Lawnsite running a little slow or is it just my pc?
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Old 01-27-2010, 03:27 PM
mirrorlandscapes mirrorlandscapes is offline
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I know when I started several years ago the feeling of being unsure of how to quote and will big commercial accounts run over me, etc. was a little daunting, but the simple fact that you are professional and responsible enough to pursue growth with a plan says alot.

Old timer is right, you have to stay on top of your receivables no matter who it is. We have several large industrial complexes that generate alot of income for us and several small houses that pretty much pay to fill up one mower. No matter who it is stay on top of it. Be polite but expect to be paid timely and let your new customers know your terms and the penalties for late payments.

That said, commercial accounts definitely take longer to get paid usually 30 to 60 days. I'd definitely encourage going for commercial accounts, they usually pay better and sometimes are less headache than a residential, but don't lose contact with your bread and butter residentials. Ask up front on a potential commercial client what their pay terms are and walk away from 90 to 120 pay terms. Unless you're a huge company thats way to long to be somebody's banker.

I guess all that to say, be bold and continue to present your company well, have a good mix of commercial and residential accounts and have fun!
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Old 01-27-2010, 03:53 PM
Five Points Five Points is offline
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I'm in my sixth year, I think you want a balance of both. I probably have more residential clients, but more revenue from commercial. I have about 70 accounts and I think thats my strength, not all my eggs in one basket.I have one BIG commercial pays well but not till about 60-90 days. I'm not sure if I want it back next year(or get it back as there always seems to be competition for big places) I think the commercials you want are the little dentists, doctors or accountants. Property the size of a residential, will usually want a few extras during the year. Go in do your work go to the next. I find on bigger cuts my hourly rate goes down. I started with mostly resi and the commercials came along as I got to know and network with more people. I hope this helps and I wish you a succsessful year Also while waiting for the big check to come in I have probably tied up 1000 dollars in fuel ,wages etc. Sometimes instead of doing tha big commercial on sat mornings I should be trimming a hedge for nice senior and be paid by noon.
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Old 01-27-2010, 05:11 PM
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DA Quality Lawn & YS DA Quality Lawn & YS is online now
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Resi's are more loyal BUT you have to have so many more of them to equal the revenue from Commercials.

Commercials are not loyal in the least, if you are beaten by a buck a cut at bid time, bye bye. However, they are the cash cows.

So, diversify your portfolio and have a certain % of each that you are comfortable with.
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Old 01-27-2010, 05:38 PM
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mowerbrad mowerbrad is offline
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Don't become too much of a "friend" with your customers. In the end you are running a business and you need to be able to do what is right for your business. So make sure to have a good billing system and keep on top of everything. Like others have said, make sure customers know your payment terms and understand any penalties that go along with them.

I am only part time but I focus on doing residentials. I do very minimal commercial work, but I will probably try to get a few more commercials over the next couple years. I would build up your customer base of redientials first and then work onto commercial accounts. When you start wanting to get into commercial accounts, start small and work your way up to the big accounts. I'd start with banks, small offices, etc., those usually aren't too big but give you some good experience. Then move up to more of the factory type accounts and larger commercials.

Like DA said, get a good mix of each to where your are comfortable.

Best of luck to you this year.
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Old 01-27-2010, 06:51 PM
WildassBaughb WildassBaughb is offline
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Business Building Ideas

Check my other posts for more.

I went full time 3 years ago and don't have any commercial as yet. I am looking for just the right fit so I don't hurt my other accounts. The best way to increase your business at first is to do more for your current clients. I do lawns, landscape maintenance, design and makeovers, lawn treatments (like chemlawn & lawndoctor). The best way to grow is stay local. Advertise for new clients with postcards to neighborhoods close to you. Good Luck!
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Old 01-27-2010, 07:04 PM
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Millers Lawn Care Millers Lawn Care is offline
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[QUOTE=mowerbrad;3385348]Don't become too much of a "friend" with your customers. In the end you are running a business and you need to be able to do what is right for your business. So make sure to have a good billing system and keep on top of everything. Like others have said, make sure customers know your payment terms and understand any penalties that go along with them.

I'm wondering a little about the "not become too much of a friend" part? I have mostly residential & I prefer the ones that I can be a friend to cause then I know I have a loyal customer, no matter what, basically. They trust me to do a good job & treat them fair without having to bid everything beforehand. But they do have to know that you expect payment in a timely fashion too. Commercials are good but like was mentioned, you usually have to bid them every year. But then at least you don't have a little old lady coming out complaining about stuff at those places either. So I'd say it probably depends on you & what type of accounts you want to pursue. Good luck!
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