Contracts

Discussion in 'Lawn Mowing' started by wacknsack, Jan 25, 2003.

  1. wacknsack

    wacknsack LawnSite Member
    from Alabama
    Posts: 4

    Most of our clients pay for services completed either on a monthly basis or when the service is provided. What are the advantages and disadvantages to having contracts with your residential clients? How do you estimate for them? and how do you set them up?

    Thanks

    :dizzy:
     
  2. Tim Canavan

    Tim Canavan LawnSite Member
    from Houston
    Posts: 218

    I like to call it a Maintenance Agreement as oppssed to a contract. Some people do not like the word contract.
    Basically, it's a prorated amount based on your price per visit. We have 40 to 42 visits for the most part. There are some that are 50 and some at 26. To make it easy, if you had a $30.00per visit yard, you would multiply 30 (the amount of the yard) x 40 (the amount of visits) and divide by 12 (the number of months). You get $100.00 a month + tax of course.
    The advantages are: the customer knows what amount they will owe each month and when, so you should have less late payers; also you know what you are making year round instead of alot in the summer and not much in the winter. I don't really think there are any disadvantages.
    I created my own agreements from one that was drawn up from a lawyer that a commercial account gave me and a couple from some friends in the buiness here.
    Anything else?:cool:
     
  3. wacknsack

    wacknsack LawnSite Member
    from Alabama
    Posts: 4

    I see the advantages you are talking about.......However, I live in a very mobile area where folks are moving quite regular. If the client moves in the middle of the year (after all the hard visits, or most of the visits have taken place) what happens then? Are the maintenance agreements binding?

    Thanks

    :dizzy:
     
  4. kutnkru

    kutnkru LawnSite Silver Member
    Posts: 2,662

    No
    ... the agreements are not binding, as they are an "agreement to provide services to a given address" for say 1 Lily Pond lane. If the client moves to 2580 Devonshire Blvd, then a new agreement would need to be written.

    The basic advantage to written agreements IMHO is that it allows you to plan your services for the upcoming season. By flipping thru the pages of your client lists, you can then plan out your season accordingly so that if you are doing design/inhancement work you will be able to look at your calendar and say Yes or No to clients who call up for install work.

    This is also a good way to see which areas of services might need to be solicited prior to your commencing the work, to make the rentals equipment more profitable, etc.
     

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