My Take on "Lowballers"

Discussion in 'Lawn Mowing' started by Mudmower, Apr 20, 2005.

  1. Mudmower

    Mudmower LawnSite Member
    Posts: 102

    Have not been posting much lately, just reading. The one topic that is off the charts in several forums is the subject of lowballers. This is the ONE subject we all seem to have opinions on.

    My reason for brining this topic up is to ask those who respond to lowballer topics and say things like....."why are you concerned about the lowballers price".........."Some folks don't need a large sum of money to live happily"................"We all have to start somewhere"........"They have to feed their family too"....................and so on and so on.

    In reading threads, most legit. LCO's AREN'T complaining about the competition from others, just their pricing schemes. I truly don't see how anyone can, with a straight face, defend lowballers pricing structures. I truly believe that for someone to come into an area and drop more than $5.00 below the going rate has ZERO business sense. Except for the freak (not intended as a put down) plan of Just Mow It, 99% of lco's can't match his volume to generate the needed cash flow. Being in business, correction, running a profitable business, requires cash flow. Without it, it's just a matter of time before the books go into the red and never go back into the black. How a person figures their fixed cost is a mixed bag, but two small to mid size legit. (insurance, taxes, workers comp etc) operations (40 to 100 accounts) have expenses that anyone with even a limited amount of business sense can figure out (if they operate in the same market).

    Tell me how someone can come in and drop prices to 15.00 to 20.00 a cut and make money when the going rate is 28.00 to 35.00???? It is not going to happen............at least not for any great length of time.

    Jim
    P.S. I am solo, part-time, 100% commercial, Legit., and I bid WAY HIGH on all my jobs. How do I know this???? I have been told more than once, you are WAY to high, but on the one's I have won it has been WELL worth my time.
     
  2. Pecker

    Pecker LawnSite Bronze Member
    Posts: 1,454

    Well said :drinkup: I don't see how people can continue to give their work away just to have the accounts. It is pretty stupid to take on the risk of being an entrepreneur, all the expenses, etc., plus work their butt off out in the weather to make minimum wage or less. . . I'll admit I've made mistakes in quoting, but not intentionally lowballing. My least profitable account is $35 for 50 minutes of work, which is okay I think even though its worth $45 - 55.
     
  3. Doc_77

    Doc_77 LawnSite Member
    from IL
    Posts: 92

    1.don't buy a $50 k work truck just so you can look cool.
    < you don't with a lettered work truck any way >
    2.don't buy the most expensive equipment just so you can brag on LS .
    3.find new ways to lower operating costs.
     
  4. MWHC

    MWHC LawnSite Member
    from Wyoming
    Posts: 202


    1. Most don't have a 50k trucks. Even the big boys
    2. The most expensive equipment is cheaper than having it in the shop, or standing in the return line at home cheapo.
    3. If you are legit, operating costs are only going up, unless you are mathematically challenged.

    The real secret to dissipating costs is to do business under the table. Just hope one of your "employees" (no, they are not considered contract labor in this industry) does not hurt or kill him/herself and sue you taking all you own; because you didn't want the legit costs incurred with doing it correctly.


    Say the word and I can go on and on about why we all need to raise our prices.
     
  5. carolinacutter

    carolinacutter LawnSite Member
    Posts: 38

    I agree, I too am "part-time", solo and legit. The ONLY reason that I am still part time is because of topics such as this. Personally I don't experience much of the "lowballing" syndrome. I have NEVER taking business from anyone nor have I lost any to another lco. The real problem I have is the fact that if you ARE part time people ASSUME that you are a lowballer and give you no respect. My plans are to go full time next year, I already turn down enough business to do it, but the more I read on here the more it scares me!!!
    I think the people that are out there "lowballing" will a) not be doing it long anyway and b) are doing the jobs we don't really wanna do any way
    They have sloppy work practices, sloppy equiment,and sloppy apperances'. Personally they are NOT my competion!!!!.....But this forum makes me wonder otherwise....
     
  6. DennisF

    DennisF LawnSite Bronze Member
    from Florida
    Posts: 1,381

    Where I'm at there are plenty of LCO's driving F350 crew-cab trucks pulling 20+ foot trailers. It seems like every year a bunch of these rigs show up in the subs that I work in and by late summer they're nowhere to be found.

    These guys aren't making in this business because their costs are out of control and they can't compete in this low priced Florida market.

    With mowing prices running in the $22-$25 range for 12k SF...you can't afford to pull a $7500 mower to the job with a $50,000 truck. It won't work... and lot of these new guys can't seem to understand that.

    The guys that come back every year are driving a "vintage" 1/2 ton pick-up, pulling a 12-16 foot open trailer with a ZTR or walk behind or both. Most of these guys are doing 60-90 lawns per week at $25 or less per lawn. I fit into this category and while I not getting rich...I am making money. That's what this business is all about.
     
  7. Doc_77

    Doc_77 LawnSite Member
    from IL
    Posts: 92

    1. ok i will give you the $50k work truck , most people don't have $50 K trucks. just asking though ... do you really need a F550 with a dump bed to haul around a crew that is just mulching grass all day ? why not use a F150 ? or for the solo guys a ranger for $10 k.

    2. thats what i thought until i bought an exmark that lasted 5 days

    3. this may be true but common sense would tell you that if you do the same quality work then the other LCO's for a cheaper price you will end up getting more customers. mathematically speaking that would make you a little more money at the end of the day.

    just a question ... let's say you did find a way to save $5 on every lawn , would you pass the saving's on to your customer and advertise a lower price in turn getting you more clients or just pocket the extra $20 a month ?
     
  8. carolinacutter

    carolinacutter LawnSite Member
    Posts: 38

    I'd have to take the $20....but thats just me
     
  9. Jpocket

    Jpocket LawnSite Silver Member
    Posts: 2,278

    That's a good one. We have employed a similar approach
     
  10. DennisF

    DennisF LawnSite Bronze Member
    from Florida
    Posts: 1,381

    If you find a way to decrease your costs by $5 per lawn, then you deserve the reward for being efficient. Keep the money, because down the road your costs will probably increase and that $5 efficiency dividend will come in handy when you have to consider increasing prices.
     

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