$25.00 or $25.95

Discussion in 'Lawn Mowing' started by DFW Area Landscaper, Jan 14, 2004.

  1. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    Ever notice that just about everything that retails in the store and costs over ten bucks has a price that ends with .89 or .95 or .97?

    I was thinking of trying this out with my bids. Instead of bidding $25.00 per cut, I was thinking of bidding $25.95 per cut. I think the customer still sees a $25 price range. If I could gross an extra $0.95 per cut, it would add up fast.

    Any thoughts?

    PS: Please don't relocate this to the elements of business forum. More people will see it here.

    Thanks
    DFW Area Landscaper
     
  2. greensummer

    greensummer LawnSite Member
    from canada
    Posts: 93

    $24.95 OR $25.95
     
  3. paponte

    paponte LawnSite Silver Member
    Posts: 2,366

    It can be a PITA when figuring out numbers. Just off the top of your head... what's 24.95 X 4 ? When you know that 25 X 4 = 100. Think you get the idea. :cool:
     
  4. coonman

    coonman LawnSite Senior Member
    Posts: 682

    That would be too much trouble for us. We have several people that pay us cash. Its much easier on them and us to keep it rounded.
     
  5. Flex-Deck

    Flex-Deck LawnSite Silver Member
    Posts: 2,846

    What do you guys do about sales tax? - In SE. Iowa it is 7%, so that makes numbers go bonkers.
     
  6. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    ++++What do you guys do about sales tax? - In SE. Iowa it is 7%, so that makes numbers go bonkers.++++

    I service two communities. One is 8% and the other is 7.25%. All of my monthly statements are for odd amounts.

    I was just trying to find out if people think $25.00 and $25.95 are the same amount. I mean, I know they're not the same amount, but what is the perception?

    There's not that much perceived difference between the two amounts to a customer, I think. But when you start adding $.95 to every cut you do and $.95 to every app you do during the year, it can add up.

    I think I'll start forcing myself to write down that extra 95 cents on my bid sheets going forward. What have I got to lose?

    Later,
    DFW Area Landscaper
     
  7. FrankenScagMachines

    FrankenScagMachines LawnSite Platinum Member
    from IN
    Posts: 4,739

    I agree with that to an extent but especially for people that pay weekly with cash. However for accounts that pay with a check or have a credit account with us (pay monthly) then I use the numbers to make the price appear slightly lower if I think it might be difficult to get the job. I look at it as “what will they round that figure to?” Lets look at it:
    $25.00
    $24.95
    $25.95
    $25.49
    $24.49
    $24.89
    $24.99
    $24.97
    $25.99
    $25.97
    $25.89

    I think you get the picture- they all round out to something in the customer’s head. If I’m looking at a lawn and I think “this is about a $40 lawn” but it seems like the customer might not pay quite $40 but I want the job and don’t mind sacrificing alittle then I might say “$37.95” and it looks like $37 or $38 to them, which is indeed cheaper than $40 but it’s a good bit more than $35. If you only went by $25, 30, 35, 40, etc. you might be losing money. If a job is worth $40 but you might be persuaded to do it for $35 and customer probably won’t pay $40, then you can say $37.95 for example and it looks like a good halfway point but in fact it’s closer to your number than theirs. Maybe this isn’t a good logic :p but I do use it sometimes if I sense that this would make a good customer and I could get extra work from them and I need the work and they might not pay quite what I want for it.

    In fact, one I have that I put at $37.95 and they pay monthly, usually they pay in cash and round up to the nearest $20 or $100. Not as a tip, but just as “paying what I’ve got and put the rest on credit”. Works for me because I always like prepay.
    However there’s something to be said for even numbers, I do prefer it more but again I only use odd amounts if I think it might help get the job. One customer told me they had been paying $25 but were dissatisfied with their service and basically I got the idea they might be willing to pay a little more for better service. To me it was probably a $25 job or maybe $30, but in order to make it look like they were getting the best deal I put it at $27.95 this way it’s plenty for me and they’re happy because they thought they might have to pay $30 for a good job. Also this lets me have room to raise the prices on these lawns without it seeming like so much. I can go to $40 and $30 on these two lawns and it won’t seem like so much of a raise because they’re still at the $40 and $30 range, not bumped into another price bracket (did any of that make sense?) Do whatever works for you.
    sorry this is long-winded but i hope it was easy to understand and helped someone.
     
  8. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    $25.00
    $24.95
    $25.95
    $25.49
    $24.49
    $24.89
    $24.99
    $24.97
    $25.99
    $25.97
    $25.89

    All are $25 to me. So why not write down $25.97 next time you have a $25 proposal?

    Later,
    DFW Area Landscaper
     
  9. Lazer_Z

    Lazer_Z LawnSite Silver Member
    from NJ
    Posts: 2,579

    Eric mind if i borrow that idea

    I know it might seem comon place to just take it but i thought i'd ask first

    And all that made perfect sence well to me it did
     
  10. coonman

    coonman LawnSite Senior Member
    Posts: 682

    I can't imagine walking a lawn and walking over to the customer and telling them I will cut it for 25.97. We have never had a problem with rounding to 5, if we think it just a tiny bit bigger than a 25 dollar lawn we just round it up to 30. I do see what you are saying about the 97cents adding up, but we like to keep it rounded when we bid.
     

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