Grouped cutomers looking for discounts

Discussion in 'Starting a Lawn Care Business' started by Whitey4, Feb 16, 2008.

  1. Whitey4

    Whitey4 LawnSite Silver Member
    Posts: 2,448

    I'll be quoting out three properites on Monday, two next door to each other and one directly across the street. All want full maintenance, mow, prune, full ferts and weed control, etc. (Yes, I'm certified for pesticides). They each have about 3k turf, and 1.5k beds. I'm still very hungry for new accounts, but I don't want to low ball either. They will all use the same LCO. Obviously, they want a discount.

    Is 10% across the board too much? I'm thinking 10% on maintenance, maybe 15 or even 20% on apps since that is where I make about 65% of my profit from. Market prices for mowing are rock bottom here, from $20 to $25 weekly. I think they are looking for $18 a week for mow, edge and blow. But, they should be all good for about $1,500 a year each in billing, even with a heavy discount. I still have to walk the properties, but these are typical numbers around here. My door hanger already offers a $50 discount off spring cleanups, but I don't know how much work there is until I see the properties on Monday.

    Forgetting the $50 off coupon, what is a reasonable discount in % on these three houses? TIA....
     
  2. Landrus2

    Landrus2 LawnSite Platinum Member
    Posts: 4,833

    What they are looking for is a bargain. next year they will call some one else and do the same thing, look for some one cheaper until you guys allow it.
     
  3. Albery's Lawn & Tractor

    Albery's Lawn & Tractor LawnSite Bronze Member
    Posts: 1,674

    0% for only 3 lawns. If it was aroun 10 or more then maybe 5-10% but not just 3.
     
  4. 1MajorTom

    1MajorTom Senior Moderator
    Posts: 6,073

    And if one of them quits, then what? one of them dies? One of them moves? Or one of them becomes a total pain in the butt and you want to drop them? Then what? You've given them a cheaper price for what?
    No discounts, give them your price, and give them good service.
     
  5. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Posts: 7,547

    they already have.
     
  6. Whitey4

    Whitey4 LawnSite Silver Member
    Posts: 2,448

    Interesting repsonses so far. Remember, I am NOT an established LCO. I have a grand total of nine accounts, all full service. Do you folks really think that leaving $4,500 in billings on the table isn't worth losing $6 or $9 a week on 3 new accounts?

    I will add, I don't have the impression they were price shopping. I left door hangers with all of them today, they talked only becuse my door hanger triggered some discussion, and decided that they weren't happy with the LCO they have used for the past 3 years. They all have expensive landscaping, quite a few sprial pines and the like. They had to use a seperate guy for pruning because the LCO's illegal crews were butchers.

    The customer asked if I was good with trimming fancy ornamentals, and said she'd rather have just one company do everything. She also said she'd like averaged monthly billing. They don't sound like price shoppers to me... I drove past these houses. These people care about their properties. They have spent a ton of $ on hardscaping and plantings.

    My thinking is to discount the weekly maintenance, and make up for it in other apps. I'm NOT going to survive on 9 accounts... adding 3 in one shot would be awsome for me. If I bump them up next year and lose them, that's fine.... new referal customers will make up for it.

    I walked about 8 miles today, and got about 160 door hangers out. This is the one call I got. Easy I think, to sit back and tell me not to give them a discount. Thanks for the advice, but I think I'll do it my way. I need the billings. $4,500 for me isn't peanuts.
     
  7. ACA L&L

    ACA L&L LawnSite Bronze Member
    Posts: 1,108

    You know what you have to do to secure customers. Once you have enuff customers start raising prices and weeding out the ones that are not desirable. Everyone has to start somewhere, I know when i started competition was fierce! I had to underbid to get started. Give em the discount and do a great job. Next year raise the price. raising prices should be done every year. Even if you only raise it 2-3 % this is good if done every year. Get the clients and move on to the next estimate. Remember you still have to get them as a customer. Good luck and remember your cost of operation is going to be diffrent then the next guy.
     
  8. topsites

    topsites LawnSite Fanatic
    Posts: 21,653

    I don't take deals offered by the customer, so for myself I would thank them for the opportunity but I am not interested.

    I just don't care for it, I don't go into a restaurant telling the chef my bright ideas either.
    It's one thing to ask if they can cook it medium.
    But to suggest they give me a break on the price because I brought friends?
    That's way out of line, it's not my place to run someone else's show.
    So, don't run mine.

    Yeah, thank you now :laugh:

    .....................................
    As for multi-customer discounts it's not entirely unheard of, but when it happens it more or less falls into place on its own.
     
  9. Albery's Lawn & Tractor

    Albery's Lawn & Tractor LawnSite Bronze Member
    Posts: 1,674

    Never lower your price to get into an area. At $9 per cut on a 30 cut cycle is $270 loss per yard, or $810 for the 3. So basically you'll be working 2 months for free. Yes $1,500 is a good chunk of change, but it sounds like these people want quality work and quality work is not cheap and they probably know that. Do what you want but there's a reason why some of us have been around for a while.
     
  10. RonB

    RonB LawnSite Senior Member
    Posts: 429

    >>Market prices for mowing are rock bottom here, from $20 to $25 weekly. I think they are looking for $18 a week for mow, edge and blow.>>

    You say you don't want to lowball, but you seem to be doing it right there. Don't "think", ASK what they have paid in the past. Why not just offer $100 month. Some months you'll get $20 per and some months $25. Then you have the apps too ..

    >>I don't have the impression they were price shopping. I left door hangers with all of them today, they talked only becuse my door hanger triggered some discussion, and decided that they weren't happy with the LCO they have used for the past 3 years>>

    I'll guess the discussion was about the spring cleanup discount? If so, that might sound real good to them compared to the last guy. Do you know why they don't like the other LCO? Again, ASK. I'd even find out what service they provided .. while you're doing your walk-around, just work it into the chit-chat. People will easily spew what they don't like about a service.

    >>The customer asked if I was good with trimming fancy ornamentals, and said she'd rather have just one company do everything.>>

    Tell them yes, and learn if you don't know how to yet. That is something of value to them if they asked. If you are priced at or even a little more than the last LCO and they weren't happy then point out what all you offer by just using you.

    Don't sell yourself short.
     

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