Customers that refuse to sign service agreement?

Discussion in 'Lawn Mowing' started by Precision Lawns, Mar 7, 2007.

  1. Precision Lawns

    Precision Lawns LawnSite Senior Member
    Posts: 283

    I have my customers on service agreements. They basically say that I will cut their lawn each week for $XX, how I bill, what I'm liable and not liable for, etc. They're one page long and fairly simple. The only change I made to the agreement this year is that I've made it auto-renew, but I also made it very clear, and even sent the customers a letter, to tell how easy it is to cancel if you don't want to renew.

    I just talked to one of my customers for the past two years, who has signed it each year without complaint. This year, he is refusing to renew if he has to sign an agreement. He says there is no problem with my service, my price is fair, he likes the quality of my work, he has enjoyed working with my company, but he won't renew if he has to sign something. The reason? He doesn't think lawn service is something that should require an agreement. He said he doesn't have to sign anything with his plumber or his landscaper (kind of rubs me the wrong way anyway, as I offer landscaping services), so he doesn't see how this is any different. I have no idea why this is coming up now and not in the last two years. I'm going to stick to my guns about the agreement, but it just bothers me since, not only have I had this customer for 2 years now, but he was my nicest lawn. I've tried to explain to him that it protects both of us, that I need it for billing, liability, etc, but he is just determined that he shouldn't have to sign anything to get his lawn mowed. I hate that I'm losing a good customer over this, but I think it's more important for me to stick to the protection that my agreement provides.

    Anyway, I was just wondering how those of you (who have agreements, of course) deal with it when you come across a customer who just doesn't want to sign an agreement based on principle.
     
  2. Total Landscape Solutions

    Total Landscape Solutions LawnSite Member
    Posts: 190

    If your not in desperate for business WALK !

    95% of your problems will come from 5% of your customers, this sounds like it'll be just the tip of the iceberg for this client.
     
  3. Precision Lawns

    Precision Lawns LawnSite Senior Member
    Posts: 283

    I am walking, unless he changes his mind - it's just weird that he's come to this decision now, after two years of, in his own words, excellent service. I was just wondering if anyone had any words of wisdom to persuade stubborn customers.
     
  4. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Posts: 1,913

    I can tell you 1st hand John that not all will sign ... I ... in fact have very few of my Resi's on a "Contract" .... ALL my Commercial is

    I do have many Resi's on an Agreement ...which carries over thru the years ... I see you stated that you explained to the customer that you need it signed for billing & liabilities reasons ...??? ... is this true ??

    Either way it's a personal thing fore some or even many to have signed contracts ... I like em my self ... I can see having signed contracts as far as when going fore some sort of loan ...to show bank or whom ever ....hey I have this many sign customers which represents x amount of monthly income ....

    Let me let ya think of this ...n any other whom might be reading ...we have much talk of "signed contracts" ....I really ... really ....REALLY understand this on most North of Dixie ... the work is seasonal ...OURS is YEARLY ...we're like that bunny .... keep going n going ... I like agreements which spell out the "Rules" ... what to expect from us n what we expect from them (ie pay me on TIME)

    Anyways .... this is what I was getting at .... say you have this customer ....2 years ...on a signed agreement .... Sweet ... we all like that

    I have a customer I've been servicing last 10 or even say 5 years (which is at least 70% of my base) ... NO CONTRACT ... same monthly payment fore last 120-60 months .... on time ...no issues

    Which would you give more value too ??

    Which would mean more if you we're buying an existing business ??

    I personally would not drop him ....but hey that's just me ... again we cut with NO break ..... we're there 42 weeks every year

    Here's a thought ... n I don't know ... I have it on my agreement ....fore those whom don't like to sign ...n I really don't know the legal stand point in court ... I have a statement on the bottom that says .... upon signature of 1st payment owner accepts all terms of a 12 month commitment .... annual renewal unless giving 30 days notice
     
  5. Mike Fronczak

    Mike Fronczak LawnSite Senior Member
    Posts: 301

    None of my residentials are on "contract", my attitude has always been "if you don't want me there, I don't want to be here" Never had the on contract never a problem getting paid either. Now commercial TOTALLY different......even if its their contract with payment dates in contract that they wrote payment still often its not on time. Their word is WORTHLESS...worse thann WORTHLESS, I had a verbal waiting on signed contract for snow from last season OK'd in june, I confired in August was told we just haven't put the contract together, then October 30 rolls around I get a letter...thank you for participating in the bidding process, needlesss to say I'm out $ 13,000 & have had a extra Bobcat sitting hear all Winter. Residentials I don't worry about, worst case your out a few hundred to try to collect.
     
  6. Az Gardener

    Az Gardener LawnSite Gold Member
    Posts: 3,899

    Any company that provides consistent, dependable, on going monthly service elt, gas, phone, etc. requires an agreement and a deposit. Businesses that provide one time or as needed services typically do not get agreements. Your business is clearly ion the first category.

    I don't think there is a thing you can say to change his mind. Some options may be to...

    Explain that your bank requires contracts to show verifiable ongoing income to maintain a low cost credit line.

    Explain that if he chooses not to sign a contract he will be charged a higher service call rate say 20% higher.

    Explain that if he is not a contracted account that he could be replaced with a contracted client. One that you know will provide a good stable income for your company and that the bank can verify.

    I doubt any of these thing will do much but piss the guy off. Presentation and timing is everything. I would have put these additions into the letter before it went out. Now the guy has to save face and nobody wants to be one upped by the lawn guy.

    I would make some amendments to my letter and just regretfully write this one off to education.
     
  7. Bigwhop

    Bigwhop LawnSite Member
    Posts: 3

    I would say for me it's very important to have a signed contract, I'm old school and I always beleived your word is your word, but times have changed and you need to protect yourself and your company. By not having a signed contract you have no leverage and no reason to complain if they refuse to pay, you cant send them to collections because theres no proof of an agreement. I have put most of my client on auto pay with a credit card and this works out great. These days your chasing more and more for money, we are not banks. I work for one of the biggest companies in the midwest and beleive me that couple hundred dollars here and there will run you out of business. You need to set the expectations and stick to your guns, I guess ask yourself if he was doing your lawn and asked you to sign a contract would you? I would thats business and most good agreements have a 30 day out for both parties.

    Good Luck
    Bigwhop
     
  8. IN2MOWN

    IN2MOWN LawnSite Platinum Member
    Posts: 4,993



    Thats not entirely true.

    Take for example your utilities or cable. I dont have one signed contract with any of them but if I dont pay them they shut off service and eventually send me to collections.

    Its totally possible to send a customer to collections or take them to court without having a signed contract.

    The only people that have contracts with me are commercial properties. I have NEVER once asked a residential to sign something. If someone wants to hire someone other then me or I dont want to do their lawn anymore then they can call me or vice versa and get out of the service.

    Contracts are worth about as much as the paper they are typed on. I might be wrong but I doubt anyone here has a law degree so Im pretty sure most of the contracts written up by people here could be shot full of holes.
     
  9. IN2MOWN

    IN2MOWN LawnSite Platinum Member
    Posts: 4,993


    Again that is not entirely true. This is why companies like gas or phone do credit checks. The better your score the less likely of having to put down a deposit.

    Also when has a utility company ever made you sign anything? I never have...
     
  10. Ramairfreak98ss

    Ramairfreak98ss LawnSite Silver Member
    Posts: 2,210

    yeah hes already a problem, even if hes been a good customer... The contract is to cover you for MULTIPLE job services. Is his plumber scheduled to come every week, does his car die every week and need to be repaired?
     

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