commercial accounts

Discussion in 'Business Operations' started by jsfrk, Aug 18, 2004.

  1. jsfrk

    jsfrk LawnSite Member
    from Ohio
    Posts: 126

    Is it pretty difficult getting commercial accounts your first year in business. I mean they would obviously pay you less because of you being a smaller company. But wouldnt' be an advantage if I have the experience and could do just as good as a job as a larger company. I mean, I have the experience and they could pay me less because of less overhead. Is this realistic?

    Another thing is, you would need to do at least 50 lawns a week to make any kind of living.
     
  2. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Posts: 4,041

  3. smburgess

    smburgess LawnSite Senior Member
    Posts: 469

    Why would they pay you less for being a small company? I don't understand your thinking on that one.

    Sorry, but on the second part of your question, I don't even understand what you're trying to say.

    I wouldn't think the "number" of lawns would have anything to do with making a living, unless you charge the same for every lawn you do.
     
  4. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    Depending on the type of commercial customer, it can be hard to get them your first year, as many of them want references. As far as the number of residentials, you could get that many your first year. I know I did.
     
  5. jsfrk

    jsfrk LawnSite Member
    from Ohio
    Posts: 126

    Well, they would pay me less because I have less overhead. Unlike a larger company. So I'd more likely to get the account verses some larger company with more overhead and who wants more money for the account.
     
  6. C&J landscape

    C&J landscape LawnSite Member
    Posts: 31

    A company with more employees will take less time to finish the job versus you that will take much longer with one or two people.

    Why leave money on the table. I charge for my time not for simply out bidding the last guy. If you do get the account for less and in the future grow and add employees you can essentially count this property as a loss b/c all of a sudden you are the one that has the same overhead as the last guy that was cutting.
     
  7. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Posts: 1,913

    Overhead cost will be larger as one’s company grow BUT the percentage of that overhead is dispersed over larger income n thus the percentage goes DOWN …. Direct n In Direct cost will rise as they related directly to ‘work being done’

    Overhead are those ‘behind the scenes’ cost …. Those which occur even if work is not performed …. Rent, advo, phone, insurance, utility bills etc. ….. we may have those same bills as a solo but our income is much greater thus lowering the percentage that overhead takes out of the pie …. Don’t get me wrong certain overhead must go up with size …. A solo can work out of the home garage while larger operations need space for equipment

    The biggest set back to getting larger accounts is lack of size …. NO WAY a solo can do a HOA of say 150 homes n common grounds in 1 day …n if they have failure equip or labor they are ^%$’ed ….. sure smaller strip malls or stand alone buildings …. But one’s price should be only reflected by there OWN cost NOT the “going rate” ….

    I bill in relation to my Direct, Indirect & Overhead + Profit == Hourly Rate …. If I need $2500 per month to perform a job n a solo can do it for $1400 (just had this one happen) … than all the power to em …. But when the hard times come, injury, damage or such they will have no back up …. They are solo n should stick to resi’s as a start n that grow into larger commercial jobs …. They are setting up for failure ….seen it …. Every year ….new trucks, equip …. They get that string of “Burger Kings’ or such do OK tell something happens n they fall behind …. Lose the big job …. Can’t pay for the truck n equip …. Lose it all n go back to push mowing
     
  8. birdmann

    birdmann LawnSite Member
    from fla
    Posts: 13

    Well i have to agree and disagree with a few above statements...I agee that the fact of running short staffed can cause a few headaches "BUT" short term , quik help is not that hard to find ...You always have to plan for the worst case senerio...

    I came out of a wholesale biz this past year to jump into this pretty much full time now ...I was runnin a VERY , VERY , high volume photo lab which made decent change but it was "wholesale" not "retail". We always had at least 1 xtra employee on staff (cause half of the employees dont really work , just tryin to collect a paycheck)....

    If you want to get commercial accounts it really isnt that difficult if you "network" the proper way and do a good job...

    when it comes to commercial it isnt actually what you know ...ITS WHO YOU KNOW ......At least thats the way these corporate companies are down here .......



    gotta spend a little to make a lot of little :)......
     

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