Getting Commercial Lawns

Discussion in 'Lawn Mowing' started by afftandem, Jan 7, 2005.

  1. afftandem

    afftandem LawnSite Member
    Posts: 196

    Whats wrong with this? why not have the company show you what they are paying and you gaurentee to go 5 - 10% less than what they paid the previous year...
  2. out4now

    out4now LawnSite Bronze Member
    from AZ
    Posts: 1,796

    ;) Oh boy, when Bobby sees this.....
  3. Soupy

    Soupy LawnSite Gold Member
    Posts: 3,125

    It's simple, What makes you think you can operate 5-10% cheaper then the cheapest guy? You do not know anything about his overhead etc. But you know that you can beat his price by 5-10%? Now what happens when the next guy with your brilliant business strategy comes by and beats your price by 5-10%?

    As a customer I could take a 10% deduction in lawn care every year. I can start out at $35 then go to $31.5, then to $28.35, then to $25.50. In 3 years I will have knocked $30 per month off of my bill. Based on 30 cuts. The LCO will have lost $105 first year. $199.5 in year 2, and $285 in year 3 on each customer. For a price depreciation of $589.50 per year/customer lost compared to 3 years ago for the LCO's.

    Plus how do you keep reducing cost every year? My example above shows that if everyone had your brilliant plan that you would have to reduce cost every year to be able to offer The same 10% discount.

    My example is based on yearly contracts, but we all know discount shoppers will not sign a yearly contract. So you will be getting lowballed every time you turned around for another 10%. When does it all end?

    I hope this helps.
  4. 1MajorTom

    1MajorTom Senior Moderator
    Posts: 6,074

    That would work in maybe landing the account, but would you really like knowing that a previous company was getting say $3000 per season, and then you'd only be getting $2700 to do the same work??? We couldn't stand knowing that.
    Do you even know your operating costs? It's best to price according to your business needs, you need to know your operating costs first before you decide to undercut the competition.
  5. Metro Lawn

    Metro Lawn LawnSite Silver Member
    Posts: 2,112

    If everyone followed this method... sooner or later you would have to pay the customer to do the lawn.
  6. steve in Pa.

    steve in Pa. LawnSite Senior Member
    Posts: 294

    Can you say majorrrrrrrr LOWBALLING Technique!!!!!! Bobbygedd will like what you asked. :angry:
  7. Lawnchoice

    Lawnchoice LawnSite Senior Member
    Posts: 781

    Bad bad bad idea.

    This shows zero credibility in your company to a prospect. Sell service and quality my man, not price!
  8. impactlandscaping

    impactlandscaping LawnSite Silver Member
    Posts: 2,332

    Ummm, are you unsure of how to price a commercial bid or something?? What if your price in mind was actually 15% HIGHER...are you going to lose 25% on a 20K contract???I would throttle the property manager if they gave my bid packet, with specs, measurements, and turf program recommendations to someone like that.At least do the work for it, for crying out loud. And as others said, if you don't know your direct / indirect costs associated with running a business, and properly submitting and preparing bids, you'll eventually run out of clients....and business.
  9. Soupy

    Soupy LawnSite Gold Member
    Posts: 3,125

    I don't normally bid commercial work because you have to rebid and they usually go with the cheaper bids. I only bid if they seek me out and ask for one. But I would have a clause in the bid/proposal that stated it is confidential and that it is not to be shown to anyone outside of management.
  10. impactlandscaping

    impactlandscaping LawnSite Silver Member
    Posts: 2,332

    Soupy, we have a design disclaimer that we make every commercial client sign before handing them a bid proposal. It states they may not make copies of any plans, drawings, photos or actual documentation until an agreement has been reached & all ideas, representations and design concepts are property of Impact Landscaping until such time as they pay the design fee or accept a contract.They are to return ALL materials included in the packet if they are not intersted in our company within 14 days. I'm taking things a step further this year by using non-photocopy security paper. IF they try to copy, it will expose the watermark saying it was copied, and then they pay either way. I get tired of bidding new commercials to have other people use our footwork and experience to get the account.

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