lowball incident?

Discussion in 'Starting a Lawn Care Business' started by BTLS, Feb 16, 2007.

  1. BTLS

    BTLS LawnSite Member
    from Texas
    Posts: 109

    Though you might find this interesting.
    Made a bid for a Managed HOA- residential neighborhood. Pretty big. I'll spare you all the details- but it's a total service gig- mow, edge, , beds, mulch, flowers, tree service, fert/herb, rye in winter, retention pond, ant killer, etc. Lots to do. It's a little out of the way for me to do, but I put in a fair bid. I read and read posts here and even jacked it up a little, you know, to make it owrth while. Total annual- $36,000. Sent it in- the HOA guy loved me. Said I was cheaper than last years crew by $3000. I thought, "Hey, great. I make out good and they already love me." Note- I don't need this client but it would be a nice addition. Anyway, I talk to the HOA members and all and we hit it off. The contract starts next month. So, the mgmt company (who has more votes than the HOA) throws out 2 more bids. One for $12,000 and one for $14,000. They overrule the HOA and hire the $12000. The HOA calls me and tells me about it. I wasn't mad, I was just stunned that anyone would/could go THAT low. $1000 monthly for all the services. The HOA wanted to fight it out with the mgmt company. I just begged off because frankly, I'm not so keen about the whole situation anymore. But from over $36000 annually down to $12000..unreal. Anyway, I wouldn't have even known about the huge difference in bigs if the HOA hadn't notified me. It does put a damper on plans to get more HOA's that are run by mgmt companies. If there are big companies willing to go THAT low, I don't think I could ever compete. I'll have to go after smaller commercial accounts I suppose. -Ben
     
  2. cleancutccl

    cleancutccl LawnSite Senior Member
    Posts: 698

    I seriously doubt it was a large company that put that bid in.
     
  3. Vikings

    Vikings LawnSite Bronze Member
    from canada
    Posts: 1,657

    The might be calling you back in a few months...
     
  4. Mr Priceless

    Mr Priceless LawnSite Senior Member
    Posts: 412

    or a few weeks. i doubt they'll enjoy hearing the bidder whine that he severly underbid and would like to jack up prices
     
  5. wowmowwow

    wowmowwow LawnSite Member
    Posts: 209

    wow...............thanks
     
  6. ed2hess

    ed2hess LawnSite Fanatic
    Posts: 13,326

    These mgt companies have their little network of guys they feed work to all the time. Keep in mind the less money to you the more left for the mgt company to GET. We are in a situation where the mgt company kept bringing in lower bids each year to the HOA. They still continue to stay with us since we have been there 6 years. But the mgt company does all these things liike cleaning out the pond and charges $1500. They wanted to strip the streets for $5000 we bid half the amount. Needless to say we don't get much new business from this mgt company. The mgt company still gets more of their money each year than we do......someday we will get his job also.
     
  7. say'n somthin

    say'n somthin LawnSite Member
    Posts: 38

    It will be more interesting to see what kind of work will be performed at this price. The same thing happened to our subdivision two seasons ago. They were paying 36,000 for the same work stated above and someone came in and bid 12,000. Lets just say the next year, the bid was back up to 36,000 with a more reputable company. I actually found out that it was an older gentleman that bid the 12,000. Without being disrepectful, the work performed was terrible. At one point throughout the season, the trimming was being done once a month. There is a huge difference between a company that does work and a person who does work on the side.
     

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