8 Month vs. 12 Month Contract

Discussion in 'Lawn Mowing' started by ReddensLawnCare, Jan 26, 2011.

  1. ReddensLawnCare

    ReddensLawnCare LawnSite Bronze Member
    Posts: 1,652

    Ok...So i have searched on here for quite a while and I have not found something on this yet so any help or references to a current/past thread would be appreciated.
    I have an HOA that is wanting me to change my contract from 12 months to 8 months. The job is relatively simple but is around 1.3 acres of mowing. I told them I would do the job for 200 per month for 12 month. They came back and requested an 8 month contract at the same price...THATS A $800 DIFFERENCE!!! I have only been doing commercial properties for two years and I have never heard of a reputable Lawn care company only doing an 8 month. I make my best profit in the winter:usflag: So..if anyone else uses an 8 month rather than a twelve..i would love to hear your reasoning behind that as well as your pricing. My pricing, except PPM, is always for a year long service so that the homeowner pays me and me only for everything they need.
  2. JDUtah

    JDUtah LawnSite Silver Member
    from UT
    Posts: 2,636

    Tell them you could go 8 months, but for 300 buck a month. Then say that either way they pay your original price stands as it was calculated for the work that needs done divided by 12 months. If they want to divide it by 8 than good for them. (this assumes you are only doing work there for 8 months of the year)
  3. ReddensLawnCare

    ReddensLawnCare LawnSite Bronze Member
    Posts: 1,652

    I will be doing the work there all year...mostly in the 8 month range...march-november...and they rejected the idea for now...someone said they know someone who will do it. I broke it down and if they find someone to do that at that price then they will be mowing 1.3 acres, in two different spots, trimming, edging, and blowing for 52 times per mow.
  4. Richard Martin

    Richard Martin LawnSite Fanatic
    Posts: 14,700

    Then let them hire someone else. I had a HOA try to get me to do goofy stuff like that the year before last. They wanted me to throw in an extra 1/2 lot with a million little tree stumps about 2 to 3 inches tall all over it. I told them they'd have to clear it to the ground before I'd run my mower over it. Someone else is doing it. And they don't do the extra lot.
  5. grassmasterswilson

    grassmasterswilson LawnSite Platinum Member
    from nc
    Posts: 4,550

    I would charge more for an 8 month cause you will be on a routine schedule and not spreading the cost over the 12 months. Also the leaves may not be completely down after 8 months so an additional charge for leaf clean up at the start up.

    Just my opinion.
  6. mowyo

    mowyo LawnSite Member
    Posts: 84

    I work for commercials that want 8 mo. or 12 mo. also.It works out to be about the same money-wise . In my area there's not much to be done in the off-season except pick up trash and maybe some leaves .98 % of the work is done apr.- nov. I try to come up with an 8 mo. total, 26 mowings ,shrub trims , mulch etc , ect - divide by 8 . Same company wants 12 mo., I just figure maybe 2-3 hours a month for trash pick up and 4-5 more hours for leaves if any and divide by 12 . It's all about getting paid for what you do and making the customer happy .
  7. Agape

    Agape LawnSite Bronze Member
    Posts: 1,645

    add the 12 months, divide by 8, don't spend all your money each month, go hunting in the winter.
  8. ReddensLawnCare

    ReddensLawnCare LawnSite Bronze Member
    Posts: 1,652

    I guess i have a different approach to calculating my cost than most people do...here is what I have done in the past for my commercials and it works out great...
    Houry Rate X Number of Workers = Cost for one mowing X 52= Total year costs/12 = monthly costs. I take my monthly cost and X 1.4( That 1.4 is a 40% profit margin) I know i wont do 52 mowings in a year but it covers leaf clean up, labor to do fert and squirt, and also the general upkeep/maintenance of the property.
    When I do my hourly rate, I do not charge 45 like some people. I pay myself 15 per hour and help 10 per hour. So when i add them up i get 25 plus an additional 10 (35) for misc. expenses that will come up.
    So a contract that will take two people two hours go like this...
    35X2=70X52=3640/12=303(1.4)=425 per month. How does that sound to you veteran LCO's. And thanks for the advice so far posted!
  9. BrunoT

    BrunoT LawnSite Senior Member
    Posts: 741

    This is a great thread. It illustrates why so many posters complain of ridiculous quotes for commercial properties given by their competitors.
  10. ReddensLawnCare

    ReddensLawnCare LawnSite Bronze Member
    Posts: 1,652

    What do you mean by that last part of your post?

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