my final conclusion on charging by the hour

Discussion in 'Lawn Mowing' started by bobbygedd, Nov 8, 2004.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    if you are a begginer, charging by the hour will save your butt. if you are a veteran, charging by the hour will kill you. i'll tell you why. i used to swear by charging hourly for leaf work. i still do charge hourly on a few properties, these are properties that are basically in the woods, and get covered with leaves constantly. the deal i have with these customers is i basically have an open check. i come when i want, and spend as much time as i want, throughout the leaf season. i keep a "timeclock" log, and we square up mid december. it's nice, but, this is what i'm finding: you have 2 guys that can work as a team, with alot of experience,both with a red max on thier back, you can move some serious leaves in no time at all. the first half of the day, CLEARED $80 a man, per hr. this work was not charged by the hour, but by the job. after that, we went to our hourly clients, and GROSSED half that. you cannot sell your work by quoting $80 per man hour. even $40 a man hr is rough to quote, most of the time they just won't bite. but you can easily make $80 a man hr, if you quote by the job and have 2 experienced guys. so, there you have it, for a begginer, the hourly quote will save you, cus your inexperience will not allow you to quote price accurately. but, for the veteran, quoting by the hour will kill you. thanks, bob
  2. mbricker

    mbricker LawnSite Senior Member
    Posts: 505

    How refreshing--a serious post from Mr. Gedd.

    This is exactly the situation I have found in my area, except the numbers are lower for this market. About 4 years ago, I started telling customers I would prefer to bill them for leaf removal by the hour. Reason being, I had shot myself in the foot so many times with seriously underbid jobs. For instance, a job that I bid for $250 including disposal, and by the time I had finished it, including hauling to the compost facility, it was about 13 hours solo.

    But when I told people I would need to get $38 an hour, or $35 an hour for jobs over 2 hours, my leaf removal business went practically to zero. The sweet generous kind old people I work for just could not conceive of leaf removal being worth anything like $38 an hour. Not even when trying to explain that I come to the job with almost $20,000 worth of equipment dragging behind the truck, and the skill and technique to get as much done in an hour as a man with a rake can do in 3 or more hours.

    But bidding by the job (with realistic time calculation) I sometimes grossed more like $45 or $50 an hour. And on those few jobs where my bid was accepted, the customer was pleased with the job, and with not being shocked by the final price.
  3. Mark McC

    Mark McC LawnSite Bronze Member
    Posts: 1,565

    There is no way in the world I will EVER tell a customer my per-hour rate. They think I should be thrilled with twenty bucks an hour. Suuuuuure.

    Bobby, how do you estimate jobs if not by the number of man/hours and your hourly rate? If you are getting $80 per man/hour for leaf work, is that your basis for estimating? Please don't expect me to believe you just pick numbers out of the clear blue sky and luckily end up with these juicy returns.
  4. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    i quote prices based on years of experience. i know the "cut off point" in the clients heads, i know what the competition is charging, i know what i have to charge to make a good profit, and i know how to "hide costs." also, i have a crappy attitude, but let me explain that.....i don't care if i get the job or not, i'm small time, i don't need the work to keep me floating, and i don't depend solely on the income to feed my kids. and a word of advice, get this hourly rate crap out of your head. hourly rates are for employees. if you quote jobs based on hourly rates, you'll always keep yourself pinned to a certain income
  5. Cheesedawg1

    Cheesedawg1 LawnSite Senior Member
    from NJ
    Posts: 283

    Thats a good point bobby.
  6. trying 2b organic

    trying 2b organic LawnSite Senior Member
    Posts: 566

    gold thats what that is. We become obsessed with the hourly rate and cheat ourselves out of the dollars that experience and equipment can command. Very good advise in this thread, I will keep trying to minimize the time I spend working and billing by the hr.
  7. specialtylc

    specialtylc LawnSite Bronze Member
    Posts: 1,656

    We never work by the hour, whether its lawn mowing, cleanups, pruning or snow plowing. Its by the job, same as B Gedd. Few people are willing to pay by the hour. They want a definate price quoted. Same as when you take youre equipment or vehicles to a repair shop. Give a price up front that both parties agree to and that way there is no suprises at the end.
  8. Fareway Lawncare

    Fareway Lawncare LawnSite Silver Member
    from Canada
    Posts: 2,222

    Just charge Regular Mowing Price & it Won't Be so Confusing for you BG...

    Unless you plan On Going Out to Every Job & Giving an estimate for Leaf Clean-Ups Every Week to all Your Customers You Have to Charge Hrly...Or Mow Price !
  9. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    fareway i am convinced you are retarted
  10. Green Care

    Green Care LawnSite Senior Member
    Posts: 530

    I always figure what my hour rate is with hand held blowers and rakes,give them a price and use littlewonders and a giant vac for the job.

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