commercial vs residential

Discussion in 'Lawn Mowing' started by coonman, Nov 27, 2002.

  1. coonman

    coonman LawnSite Senior Member
    Posts: 682

    It seems to me that most of the people out here go for the large commercial accounts. I have no experience with those, we have a few small commercial that are friends or customers brothers etc. But the bulk of our business is residentials. Average lawn for us is 30 dollars for 15 min work. We do have many areas clumped with 7-10 house within walking distance of each other. Some advantages I see with residentials are....

    word of mouth advertising from our customers

    99.9% loyalty ( we only seem to lose them if they die or move)

    perks such as pies and cakes and Christmas bonuses

    lower overhead because larger expensive equipment is not needed

    I would appreciate some input from the large commercial guys on some advantages with those properties.

    thanks
     
  2. SpudsM15

    SpudsM15 LawnSite Senior Member
    Posts: 627

    As of right now i only have residential customers. Can someone give some insight on how to price the big commercials.
     
  3. MN Wildwood

    MN Wildwood LawnSite Member
    Posts: 80

    I have more residential than commercial, but I do find it to be beneficial to have some of my commercial, not only because as a buisness I have not needed to worry about being paid, but on occation employees of the business have asked me to mow their own yards. It depends on what equipment you have and are willing to have & repair- the more you have, the more problems you can have, likewise the bigger your equipment the more you pay for it.
     
  4. grass chaser

    grass chaser LawnSite Member
    Posts: 20

    I agree that residential customers are loyal and will only let you go if you screw up. It is good to have a few commercial customers to help pay the bills. They pay on a regular cycle and you can always count on them in the winter months.
     
  5. sheppard

    sheppard LawnSite Senior Member
    Posts: 542

    Great question Coonman,

    Got to say that I prefer commercial. Have 38 accounts in Tallahassee. Almost a 50/50 split between commercial and residential.

    In this market residential will drop you like a stinkin' road kill. Commercial just wants the job done and wants the pace to "look good"

    Some of my commercials are slow payers but they are predictable: some I have to stop by and collect, other run 45 to 60 days late. When I get on the horn and call them they cut the check quick.

    Seems like some of my residentials, when I started, were predominantly retirees... you know the problems there. They'd follow me around, try and talk to me, ask me to do unbeleivable "stuff" and then act shocked when I charged them for the unbeleivable stuff.

    Never had a commercial customer balk at the quality of my work or the price. Have had countless residential customers say "I can't afford you!". Again, none of them thought my work was sub par, just didn't want to pay my rate to get it looking like they wanted it to look.

    Cordially,
    S.
     
  6. SpudsM15

    SpudsM15 LawnSite Senior Member
    Posts: 627

    Shepard's right I have a few older folk that follow me around asking me to do things and expect not to pay for it! I hate that.
     
  7. Spokane

    Spokane LawnSite Member
    Posts: 1

    You will always wrestle with the idea of residential vs. commercial accounts. Drop the debate of either/or and simply go after the accounts that put food on the table. Residentials are great for loyalty and stability, but depending on your local economy and competition, residentials provide very low profits and require a great deal of hand holding. Commercials, although less loyal, will tend to complain less, need less babysitting, and you'll make twice as much. If I weren't concerned about stability I'd drop every residential I have!!
     
  8. greenman

    greenman LawnSite Addict
    Posts: 1,405

    I go for high end residential, medium to high- end residential with contract, and small to medium commercials. Therefore, I dont grow near as fast as some do, because I am so selective in my accounts.
     
  9. Green Pastures

    Green Pastures LawnSite Silver Member
    Posts: 2,457

    I've gotten to the point where I've become really selective in which new accounts I will take on. Not that I have hundreds of phone calls every day, but I am at a comfortable level for a solo right now. As I grow to where I need help I want to make sure the accounts I grow into are ones I WANT to do. Worth doing.

    I'm targeting really high end residental ($300K and up) and medium to high end commercial. I will not take an account if they do not have irrigation, and they must be willing to use it. PERIOD. I have a few medium size resi's now that refuse to water, really it's just laziness, they dont have irrigation. They complain to me that with all the seeding, fertilization, aeration etc. that I do how come their lawn does not look better than they do. I gently remind them of how many times this (drought filled) summer I practically begged them to water more. Some of them I would even set out the hose and turn on the water as I was leaving. You guessed it when I returned the next week the sprinkler was in the exact same place. They were to lazy to get out there and move it around. SHEEESH!

    I'm through with people who will not at least help me to help them. I cannot (well I can but it'll cost ya :D) be responsible for watering your yard as well as the maintenance of it.

    I have this lady, pay's me $160 a month every month all year, to mow, fert, weed control and leaf cleanup in the fall. She has maybe 2200 sq ft of grass. It takes me like 20 minutes if that from the time I pull up till I'm driving away. I charged her $350 last fall (2001) for aeration and seeding. I did a KILLER job, I mean I had a plug every 1 1/2 inches everywhere on that property. Several weeks later there was a great lawn of nice fescue. It was beautiful, I was really proud and she was estatic, babbling on and on about what a master gardener I was, never had her lawn look that good before. I told her then and even wrote it down, drew up a watering schedule for her and everything, I said that she would have to help me by watering on a regular basis. Not alot of water but just consistent, deep watering two days a week. I figured that was all I could hope for. Long story short, I was there yesterday doing leaf cleanup, and there is not one single sprig of fescue left anywhere on that lawn, not one. All of it was killed in this years drought.

    She came out and asked me what happened to her beautiful lawn, I wanted to slap her. Of course I didn't, I just looked at her and said "Mrs. So and So you did not water twice a month this summer, let alone twice a week, and most of the times this lawn got any water at all this summer was when I laid out the hose and turned on the spigot myself." Then I just walked away. I'm actually surprised I did not get a call telling me I was fired, but she knows it's the truth and she has no-one to blame but herself.

    These are the kind of properties that make me as a LCO look bad. The neighbors see me come every week, they see me spreading fert, aeratiing and seeding, and yet the lawn looks only a smigen (sp) better than when I took it over. This looks bad for me. I want to drop her SO bad.

    Anyway, sorry to ramble but this is why I'm getting REALLY selective. I want to help people have a better looking property, but there are things that I simply cannot be responsible for.

    More commercial next year for me and only really high end resi's.
     
  10. lawncare3

    lawncare3 LawnSite Bronze Member
    Posts: 1,981

    coonman,
    What is lower overhead?
     

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