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Old 10-27-2013, 10:07 PM
jkubala jkubala is offline
LawnSite Member
 
Join Date: Oct 2013
Location: Brandon, Ms
Posts: 1
Keeping Commercial Clients

I recently took a hit and lost 2 of my biggest clients. I know one of them was under bid by a part-time grass cutter. The other was taken from a larger company than me. My commercial accounts are what pay my company's expenses and residential are what pays my salary. To give you a little insight of my company. My name is John and I run 1 truck myself with 2 part-time employees (had 1 full-time guy but took another job and haven't found another guy worth a darn) Both commercial and residential are done by contracts only. Been in this business 10 years, owned my own for 5 years. I plan to run 2 rigs with 1 full-time guy with me and the other 2 part-time guys in the other. I found this site earlier this year and really enjoy reading the posts in here.

I'm going to leave it to the bigger guys that run a bigger operation than me to give me a better insight of things. What are the pro's and con's of instead of running a the normal 12 month length and go into long term like 24/36 months contracted terms. I know gas prices will be and issue to deal with. My lawyer and the board (3rd party of 3 elected people) that oversee my contracts and company's operation have suggested a floating payment. Basically the payment is not set, it allows for a 5-10% increase/decrease if fuel costs rise enough to initiate it. It makes sense and will allow me to have a longer run time with a commercial account. My residential side has (1) 9 month and (2) 12 month terms. A 24 month term is in the works for them but the client has to have been with me for at least 3 years with a good payment history before they are allowed that option.

I've always stayed clear of the commercial side of work because I've always felt that properties are so under bid out that the very little profit made from the work now. I have been lucky to gain what commercial accounts what I have and focused my work on the residential side. I retain 85-90 percent of my residential for 3-4 years approx. Most move and some can't make the payments. If I want to grow in this business I know I need to gain more commercial clients but my question is how do I retained them without getting underbid and losing them for the next term? I feel like I have been holding back over the years by only focusing residential clients. I hope to hear from you and get different feedback so I can get a better understanding.

Thanks In Advance!
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