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Need help about under chargeing

Discussion in 'Lawn Mowing' started by Jim Feder, Jun 28, 2004.

  1. Jim Feder

    Jim Feder LawnSite Member
    Posts: 87

    Got about 11 cuts under are belt and just realized that I have been under charging a customer she has a service agreement and she paid the same price for the last two years it is only 10.00 a cut but do I bill her or eat it and change the old price now.:confused:
  2. impactlandscaping

    impactlandscaping LawnSite Silver Member
    Posts: 2,332

    Wow, $ 10.00 a cut? Good luck trying to raise the price this year if she is under an agreement.Unless there is a stipulation stating the price is subject to change without notice, I think you are boned for this season. Raise your market there a little....:eek:
  3. pjslawncare/landscap

    pjslawncare/landscap LawnSite Bronze Member
    Posts: 1,410

    It sounds like your error. Eat it and pay closer attention to what you are billing
  4. Norm Al

    Norm Al LawnSite Bronze Member
    Posts: 1,227

    jim you need help with more things than just under charging!

    first NEVER let a customer dictate your prices,,,,,you believed her when she told you she had only paid $10 per cut for the past 2 years? did you see the guys checks? is he still in business? did he have insurance?

    second NEVER be ashamed to stay in business! in fact she needs you to stay in business to service her. go straight up to the woman and be honest with her,,,,maam we gave it a shot at the price you told us you were paying and we truly feel it would be impossible for us to stay in business at this rate,,,,,we will have to raise the price immediately to this $-------
  5. Firstclasslawn

    Firstclasslawn LawnSite Senior Member
    Posts: 341

    excuse me but who in the hell cuts yards for $10 a cut I wouldnt even get out of my Truck for $10 WoW my minimum is $30.00 to $35.00 and $25 for just the front yard WoW
  6. Lbilawncare

    Lbilawncare LawnSite Bronze Member
    Posts: 1,116

    Bill her the Ten measly bucks and then before you do any more work for her explain the situation and tell her you will be raising her rates. How big is the yard anyway?
  7. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    I have to agree, and if she refuses just get out of the agreement then. Better to get out of it instead of staying in it and losing your shirt
  8. Runner

    Runner LawnSite Fanatic
    Posts: 13,496

    Not only that, but figure out how much it's costing you everytime you cut her lawn. You SURELY aren't MAKING anything on it,...there's no way.

    PMLAWN LawnSite Gold Member
    Posts: 3,535

    Jim, at this point I think you need to do a lot of work on knowing your overhead and costs of doing business. I think you will find that at $10.00 you are losing money on this or any account. How much time does this account take. Start at the time you get in the truck at the last job and start counting---Drive time to job--park/unload--trim/cut/blow--reload/tie down--sit in truck and mark time. This is the total time on the job. My guess is at best you got 20-30 min. into it. Add up all your costs of doing business.
    .ALL OF THEM..
    Truck gas / payment / insurance / taxes / maintenance / +++
    Mower payment / wear and tear or cost to replace / gas / maintenance / blades / +++
    All other equipment used on the job +++
    Time at home on phone / paperwork / computercosts / phone costs / paper-pens-stamps-stationary / +++
    Insurance / taxes / legal fees / +++
    and I am missing some things, point is that all this must be counted--added up --and divided by hours worked- this is your overhead-
    Now add you pay. If you want to bring home $10 per hour than figure about 13 for taxes and such. (this is just a number)
    You are a business and need to make profit. This is what is left after paying everything else and should be a percentage of your total billings, This number is why you are doing this and should always be your main goal.

    If you add this all up I think you will find that you are losing money by showing up at the house and cutting grass. Start charging more for all new accounts---Raise this one- If you lose it so what, you are losing money by doing it- go out and find better jobs. If you find that you can not charge enough to make profit than go to walmart and get a job there. You will be money ahead.
    But I don't think that will be the case. The good paying properties are out there, just keep looking. Good luck
  10. MudslinginFX4

    MudslinginFX4 LawnSite Bronze Member
    Posts: 1,170

    Drop that account like you would a fat ladys dirty underwear!

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