12 month billing?

Discussion in 'Business Operations' started by qualitylawnmanagement, Apr 1, 2006.

  1. qualitylawnmanagement

    qualitylawnmanagement LawnSite Bronze Member
    Posts: 1,001

    I'm going to try a 12 month billing just for mowing. From what I understand is you take the price and times it by 30 cuts and then divide by 12 months right? Is there anyone out there who does this? What type of responses have you got out of it? Is it a good move?
     
  2. ed2hess

    ed2hess LawnSite Fanatic
    Posts: 13,328

    Works just fine as long as you can explain to the customer that they will be paying when you aren't mowing. The younger customers just want low monthly payments and they want them to be the same each month. They like it better if you can have on-line paying.
     
  3. firefightergw

    firefightergw LawnSite Gold Member
    from Texas
    Posts: 3,340

    It works great as long is you have an iron clad contract and a credit card on file. Believe me, when the Winter comes even the best people will hesitate to send a check. By having a credit card on file you can get your money. Make sure if you have employees on the payroll you don't run into cash flow problems during the season too.
     
  4. StBalor

    StBalor LawnSite Senior Member
    Posts: 798

    This worries me though. What if the client drops you after the mowing season is over? most contracts will let the homeowner out of the contract with so many days notice.
     
  5. ProMo

    ProMo LawnSite Bronze Member
    Posts: 1,468

    my agreements require 90 days written notice and when I quoth the monthly price I also have an inflated per cut price so if a yard averages 40 dollars per cut I will put in say 45 for the per cut and if there is a cancelation I multiply the visits recieved times the per cut price and that is what is owed if that makes sence
     
  6. BILLY DAWG

    BILLY DAWG LawnSite Member
    Posts: 18

    This is what we do. We put residential clients on a 8 month billing cycle and our commerical on a 8 or 12 month cycle it's there choice. I will tell you this that you will have a lot of problems getting your residentials on a monthly contract around here because they dont feel like there getting theres moneys worth. It all comes down to how well you can sell it and if you are likeable and trust worthly.
     
  7. grass-scapes

    grass-scapes LawnSite Bronze Member
    Posts: 1,552

    I prefer the monthly contract to the per visit customer. I have about 70 percent of my clients on contract and more are asking for it all the time. I have a clause that is either a 60 or 90 day period of payment or charges for services accrued at normal rate to the point of cancellation, whichever is GREATER. I had one who wanted to cancel during the off season last year, but her contract renewed automatically in September. I reminded her of the terms of her contract and told her what the cancellation charge would be and she hasn't said anthing else, and pays on time.
     
  8. qualitylawnmanagement

    qualitylawnmanagement LawnSite Bronze Member
    Posts: 1,001

    Well guys I am going to try it on a few up scale acccounts of mine. The others I will bill monthly just for that work. Thanks guys for the help!
     
  9. mtdman

    mtdman LawnSite Gold Member
    Posts: 3,137

    I don't do 12 month, I do 7 or 8. That gets all the payments in during my work season. However, there aren't many people who want to do this, which suprises me. The old people have it in their heads that they are paying for work I'm not doing before I do it. It's just like an easy pay with the electric company, which many of them do, but they still don't like paying the same $$ in April when I only do a few mowings as they do in July when I'm there every week. It's like dividing a dollar into 4 quarters. It's still a dollar no matter what.
     
  10. qualitylawnmanagement

    qualitylawnmanagement LawnSite Bronze Member
    Posts: 1,001

    Well I am going to try it on two apartment complexes and two commercial accounts and one up scale residential account. Around here it hardly ever snows, maybe 5 to 6 plow able events so I need some money that is coming. I make more off salting than snow plowing. In the winter is when I do all of my over grown property maintenance, such as land clearing, brush removal, and logging, and my dad and I fix up houses and then sell them in the spring. So if I can have guarantee money coming in each month and know how much it is then I know what I have to spend. Thanks guys for the help on this topic good or bad it's helpful.
     

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