1. Missed the live Ask the Expert event?
    Not to worry. Check out the archived thread of the Q&A with Ken Hutcheson, President of U.S. Lawns, and the LawnSite community in the Franchising forum .

    Dismiss Notice

No more " per cut " arrangements

Discussion in 'Lawn Mowing' started by Rons Rightway Lawncare, Mar 9, 2007.

  1. Rons Rightway Lawncare

    Rons Rightway Lawncare LawnSite Bronze Member
    Posts: 1,163

    After nearly 13 years in this business, with the majority of my jobs being per cut basis, I finally said enough.... This month my customers all got letters informing them that starting now, they are now going to be billed a flat monthly rate, and the rate will be the same from now through Dec. We don't mow in Jan and Feb, so they don't need to pay then.

    Wondering how many will cancel over this, but so far I have only heard positive things from the few customers I have spoke with. They said it will be easier for them, knowing their bill will be roughly the same each month.

    Also put in the letter that I am going to be charging late fees if payment is more than 30 days late and service will be suspended if payments are more than 45 days late.

    And put in a note about a fuel surcharge policy - had a few complain about it last year.

    I hate to loose any customers, but if I loose a few now I can replace them with better ones.

    I just have had it with customers questioning me about mowing when they don't think it needs it. I used to cut even if it was questionable, just to try to get in as many cuts as possible. Now I will be able to skip them if they are questionable and still get paid.....
  2. Flex-Deck

    Flex-Deck LawnSite Silver Member
    Posts: 2,846

    Most of my bigger commercial accounts are on an equal payment basis for mowing. I take the per mow bid, and multiply it by 26 (mowings per yr. ave.) then divide by 7 months. They pay on the 15th of May thru Nov. They like it because most businesses budget, and like knowing what the cost is going to be. We visit the properties every week (approx. 32), and during the dry season (Late July and August, It may require one round along roads and the shady side of the buildings to keep it looking really nice, so It works out great for both of us.
  3. DuraCutter

    DuraCutter LawnSite Senior Member
    Posts: 806

    Monthly is easier for you and customer. You won't lose too many but some I'm sure will leave. It's natural I guess. Mine are all monthly although I'm all condos and commercial. I guess residentials will be the same as they will look to make sure you come around, but yeah, if it's not growing it's less of a pita, they'll pay because it's monthly.
  4. ACA L&L

    ACA L&L LawnSite Bronze Member
    Posts: 1,108

    I am interested to hear how this works out for you. Will you be charging extra for fert, aeration, leaf clean, pruning? Or will this all be included in the price.
  5. Rons Rightway Lawncare

    Rons Rightway Lawncare LawnSite Bronze Member
    Posts: 1,163

    For example, I have many lawns at 30$ per cut.

    If I came out 3 times this month to mow I would bill them 90$. Or if I came out 4 time they get billed 120$, or if 5 times 150$.....

    Anything Extra other than mowing normally goes onto the bill.

    What I am doing now is just charging a flat rate for these customers of 120$ per month, and it doesn't matter how many cuts I make per month. I didn't specify a number of cuts, just that the lawn service would be billed per month, not cut.

    I also gave them the "option/ idea" of using the monthly flat rate as a way of making paying me easier by setting up a automatic pay through their banks where they don't have to do anything, the bank would just send me a check each month. I have a few customers that do this now and it is great.

    I also suggested that if they wanted to, I would rework the monthly amount to include the fertilizer treatments and aeration and seeding, and a hedge trimming or anything else they might need. But personally I would rather bill separately for that.....

    My plan doing it like this, with the monthly flat rate and billing separately for the extras.... well it protects me from getting screwed if a customer cancels on me. No matter what time of the year they cancel they are never really " ahead " of the game.

    In a typical 12 month contract, there are several times in the year that if a customer cancels, you do get screwed. Such as if they cancel right after you spent alot of time or money on a big shrubbery pruning, or right after aeration, or just after the bulk of the leaves are down and cleaned up. You see with a 12 month contract there are several " Big " jobs that get done per year that you make up for by collecting the pay after a few easy months after each of these big job months. If your cancelled right after a big job, well your screwed.... Even if you plan out a 12 month contract the most simple way, you still depend on getting a check for Jan and Feb while you sit on your butt at home chatting on Lawnsite, If they cancel you on Dec 31st then your screwed out of those two months pay that was to make up for all those hard months in the summer.

    Like I said, I expect some of my customers will cancel, but so far I have not gotten any negative feedback at all. Only positive feedback.

    I still think about how much money it is to get any kind of professional out to your house to do any kind of work. If a person had a plumber or a A/C guy or the maytag repairman come out everyweek and spend 30 minutes to a hour doing some kind of labor based task.... I can't imagine a bill from them of less than 300-500$ per month So paying me 100-150$ per month is a bargin.
  6. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Posts: 7,547

    The problem with your theory is that the maytag guy is usually there to do something they dont know how to do. We are there to do something they dont want to do, so they are expecting to pay us less. But monthly billing is the way to go. I couldnt immagine charging per cut.
  7. TurfConcepts Inc

    TurfConcepts Inc LawnSite Member
    Posts: 52

    We bill flat fee monthly, have from the start. It is definitely easier for our billing and the customers to pay. Anything beyond the normal maintenance is billed separately. I have had no complaints but all customers are told this when we do the original estimates. The best benefit of it is there is no flux in income during the year on maintenance accounts.
  8. Rons Rightway Lawncare

    Rons Rightway Lawncare LawnSite Bronze Member
    Posts: 1,163

    Well, had one customer call already bitching about my new " Plan "...... He thinks this equals a 30-50 percent increase for him. He thinks he paid me 700-800$ last year for service and this year he is looking at at least 1200$ per my monthly billing plan.

    He doesn't seem to remember that I was out there twice per month Oct, Nov, and Dec - he thought I was out only once or twice all winter, yet he paid my bills last fall and winter without question.

    He also isn't taking into account that I didn't start service with him last year till the later part of April....

    And he forgets that he gave me a riding mower he wasn't going to use anymore now that he had lawnservice and I gave him 2 months service free in lieu of the mower - which I cleaned and turned around and sold for 400 or so bucks....

    He said that if it is going to be 120$ it was going to be 120$ and he would have to deal with it, but was obviously not happy about it..... He told me this like 3 times during our conversation...... He also mumbled under his breath something about maybe looking for some estimates from some other companies....

    Oh well, maybe this will be the first of many to end up cancelling... or maybe he just gets over it and understands that he is still getting a good deal. Not sure of his lawns size but I would estimate he grass areas to be somewhere from 1/2 to over 1 acre.
  9. RonB

    RonB LawnSite Senior Member
    Posts: 429

    If it's another dry summer and you only cut 2-3 times in July/Aug. do you think they will understand?
  10. Rons Rightway Lawncare

    Rons Rightway Lawncare LawnSite Bronze Member
    Posts: 1,163

    They better! I got bills to pay too!

    My cell phone costs the same no matter if I use it just a little or use it to the max number of minutes they allow in my " plan "..... Should my bill be less if I use less minutes? Maybe, but that is the way it is and I just pay the bill and get on with life!

Share This Page