just a thought/ contract issue

Discussion in 'Lawn Mowing' started by bobbygedd, Dec 28, 2003.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    how many people have noticed that customers tend to "shy away" from the dreaded "contract"? how many have lost possible clients because they will not work without a contract? here is what i'm getting at, and it's just a thought, definitely too much time to think at this time of the year: when i was in my early teens(not that long ago, really it wasn't) i worked for a department store. i was the "recieving clerk". part of my job was to calculate pilferages. this means items that were stolen. i documented the cost of these items on a weekly basis, then handed in the totals at the end of the year. thefts were expected, and were considered part of doing business. at the beginning of the year, they estimated how much they would lose to theft in the upcomming year, this was factored into operating cost, and prices etc were set accordingly. now, to the lawnman. does anybody estimate theft(people who skate on the bill) and factor this loss into your operating costs and price the work accordingly? which brings me to the contract issue. is it a wise move, to say the heck with the contracts? not many people will screw you, but contract or no contract you will get your share. by eliminating the contracts, you will get more work(i think), and as long as you factored in a certain amount of theft each season(it's part of doing business, so i've heard) and not take it personally, and adjust prices accordingly, you should be ok? or not? i'm rambling, but i think u guys get my point. does it make sense? i have personally yet do do any mass marketing. this year i will.with the small amount of advertising i've done over the years , only a handful of people objected to a contract, and i would not take these people on without one. as i mass advertise this year, i'm wondering how many will object, and if my suggestion above will make any sense.
     
  2. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    bobby
    You would have to rase your price then to cover the losses of being stiffed becuase of no contract, so why not work with a contract and not have all the troubles of not having one and price accordingly. If you can get 3 people to sign a contract for $10 thats $30 but what your suggesting is you would have to get 4 people to work for in case one did not pay or am I missing your point?

    Mac
     
  3. BravesFan

    BravesFan LawnSite Member
    Posts: 233

    Contracts...

    I've read through these forums that a large number of people aren't using contracts.

    I think you're hurting yourself not using them. Customers aren't going to freak out over the use of a contract. As another poster once stated, you even have to sign a contract to get your tires rotated at Walmart. A contract simply proves there is an on going agreement between you and the customer. It can also help you get paid for work already done.

    Contracts also make your business legitimate in the eyes of lending institutions...esp. in the first years...before you've had a chance to file your taxes ...or become profitable. If you're looking to grow your business and need a bank loan, it'll be tough unless you can prove the amount of business you're doing.

    Dennis
     
  4. proenterprises

    proenterprises LawnSite Silver Member
    Posts: 2,297

    Here is my take on contracts...if it is a residental account with just a weekly in and out cut...why bother with a contract. Tt is much easier to just go month-month and bill per 4cuts/month cycle.

    Commerical accounts are more important to have a contract for. Basically due to the fact that their is much more work as well as a higher volume of money involved, and that you wont always have the privelage of dealing with the same face on every issue as you would with a homeowner.


    I have never thought about theft of services as a factor. It hasnt really happened to me much and whenever collection issues arose, i always got the cash in the end.
     
  5. TJLC

    TJLC LawnSite Bronze Member
    Posts: 1,308

    I have found, IMO, that customers seem to respond better to the word "agreement" than to the word "contract". I have recently converted all my "price per cuts" to yearly "agreements". So far, so good. Good luck.
     
  6. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    mac, what i'm saying is.....working without a contract, is a crap shoot. but, if you have calculated the risks, and accounted for some losses in advance, and just consider it part of doing business, would you land more accounts without a contract? i'm just curious, because, like i said i will advertise big this season, being my first full time and fully reliant on the business for income.i'm not sure what to expect.
     
  7. bayfish

    bayfish LawnSite Senior Member
    Posts: 641

    Like TLC, I offer year round maintenance agreements to residential customers and contracts to commercial customers. The word "contract" seems to intimidate residential customers. However if they just want mowing only, I usually won't bother them with signing an agreement.
     
  8. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    ok, there u go. thats what i meant. mow only, no signed agreement. now, with a no sign agreement, will u get more clients, faster?
     
  9. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    bobby
    let me know how it goes for you. I posted in oct. that I did a job without a contract and I know better and I lost I think $800 I would have to look it up. But I won't pick up a cig.butt off someone prop without a contract. I like what TJLC said about an agreement that all a contract is anyway.

    Mac
     
  10. Pecker

    Pecker LawnSite Bronze Member
    Posts: 1,454

    Proenterprises,
    I couldn't have said it better myself. That's exactly the way I do it and what I'd have said.
     

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