Breaking the news..

Discussion in 'Lawn Mowing' started by Josh.S, Sep 7, 2006.

  1. Josh.S

    Josh.S LawnSite Bronze Member
    Posts: 1,085

    I was wonder how you guys told your customers when you are raising them. I bought 35 account about 3 weeks ago and the guy I bought them from agreed that almost all of them needed ATLEAST a $5 raise. Most of the customers are very nice, but my delima is that the customers aren't attached to me, and if I jack it they might leave. I'm going to go easy on the raises next year so the customers get to know me, and then jack them all a little bit. I'm not trying to make millions but inflation and gas and all the normal expenses make it a reason to raise people periodically.

    What do you guys think? I have been kinda dropping seeds to several of the customer while having a conversation with them and saying things like, "yeah i hope gas prices don't go up very much next summer, beacuse i'm driving way further than the last guy was, and the truck gets less than 10mpg pulling the trailer, i would hate to have to raise people's prices just to make a small profit"
     
  2. grass disaster

    grass disaster LawnSite Silver Member
    Posts: 2,582

    how much did you buy the accounts for?
     
  3. Sandgropher

    Sandgropher LawnSite Senior Member
    Posts: 909

    Sounds like you brought yourself an under priced business, its easy for the previous owner to say they could do with an increase, but its very hard to increase prices straight away, been there,done that........what i did was waited a reasonable time before increasing them.:)
     
  4. LawnBrother

    LawnBrother LawnSite Senior Member
    from SW Ohio
    Posts: 867

    I have never raised prices on a new customer. It's like, "Hi, we're your new lawn service! Oh, BTW.....we're raising your price $5...." Just doesn't sit well with me. I say wait until the beginning or middle of next mowing season if you can, hopefully they're not underpriced TOO bad! Show them you're reliable and do killer work and they will take it much better IMO. GL though...
     
  5. Surf'n'Turf

    Surf'n'Turf LawnSite Senior Member
    Posts: 326

    Maybe try 7-10 accounts that need thier prices 'adjusted' (never say raised!) the most next season (because you're coming to the close of this season) and see what reaction you get before you try all 35.
     
  6. rb_in_va

    rb_in_va LawnSite Member
    from VA
    Posts: 246

    As a homeowner that wouldn't fly with me. Don't throw out a bunch of excuses like that (it might prompt me to find someone closer). Most reasonable people understand inflation. If you get some that give you a fit about price adjustments then maybe those are problem accounts that you can eliminate right away. Agreed that you should wait till you have proven your worth though!
     
  7. nobagger

    nobagger LawnSite Gold Member
    from Pa
    Posts: 3,065

    We had a similar situation this season. We bought out a company of about 30 accounts and when we went over the pricing he said "almost all of these should be raised this year". I agreed to not raise the prices if they all signed with me for the first year. But I simply told them when talking with all of his formar customer's that he was going to raise them but we would'nt this year but the price may or may not increase next (2007) season.
     
  8. Josh.S

    Josh.S LawnSite Bronze Member
    Posts: 1,085

    They aren't underpriced to bad, alot of the customers EXPECT a raise, and I don't think I should not give them a raise. May I'll keep them now, and then the one's that sign contracts I don't raise, and the one's that don't sign contract's I should send them a letter or tell them, something to the effect of

    Fluffly Letter Opening....
    Due to inflation and increased overhead your price will be adjusted from Thirty-Six dollars to Thirty-Nine dollars per mow on your next billing cycle. Your business is very important to us, if you have any questions or concerns about this call me at 555-555-5555.

    I don't know what to do but the guy that owned everything before me has a group of VERY NICE and VERY UNDERSTANDING customers, atleast 25 of them need a $3+ dollar raise. Well they actually need more than that but I figured if I raise them all $3 or so that they would all be good with it..



    I bought all of the equipment that the business was ran with, and the accounts. Everything except for the stihl trimmer that you see in my signature was purchased with the business and much more. I estimated by guessing the used value of the equipment that I paid between 7-3 thousand for the acccount.. even though the pricing might be a little low it is still a great deal..
     
  9. stumper1620

    stumper1620 LawnSite Bronze Member
    Posts: 1,889

    I would finish out the season at the current rates, get contracts agreed to for next year and be sure they include a 5, 10 or even a 15% increase accross the board. Whatever it takes to get everybody on a proper level.
    I agree with a couple of the other post
    1st never say raise prices "adjustments" sounds so much better.
    2nd don't use excuses, just make a adjustment to bring all your new clients in line with your existing accounts. Then do biannual (every other year)percentage based increases. ( don't go overboard.)
     
  10. NNJLandman

    NNJLandman LawnSite Bronze Member
    Posts: 1,306

    Raise them little by little, 2 dollars this year, 2 dollars the beginning of next year and a dollar at the end of next year and say they are gas surcharges.

    Jeff
     

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