Payment schedule

Discussion in 'Pesticide & Herbicide Application' started by jajwrigh, Oct 25, 2004.

  1. jajwrigh

    jajwrigh LawnSite Bronze Member
    Male, from Martinsville, IN
    Posts: 1,405

    As I piece together my services for next season I find myself coming back to the issue of payments. Do I bill the each customer for every application round and aeration or do I add up all of the services they want and divide by 12? It would be nice to have that constant income with the 12 month plan, even though it would be less at a time. What are your experiences with this fert and squirt gurus? :help:
     
  2. quiet

    quiet LawnSite Senior Member
    Posts: 720

    I wrestle with this issue also. I have all res customers on 12 month contracts, but only a couple on the "full meal deal", same rate per month plan with all my fert, weed, snapshot, etc. costs added up and divided by 12. The others are on a "basic service" plan all 12 months, but get billed additional with each fert or weed application.

    I'd hate to have someone cancel on me before the 12 month period, when I haven't recovered all my fertilizing costs . . . or sometimes I wanna cancel them, and I don't wanna take the loss.
     
  3. Envi-Lawn

    Envi-Lawn LawnSite Member
    from CT
    Posts: 86

    I give all clients the opportunity to pre pay for the season (5% discount). About 75% take advantage of the discount. They are locked in for the season. This means less paperwork and no cancellations. These accounts seem to get the best service, as they show the highest loyalty, year after year.
    All others pay as they go. Not a problem, as the steady income flow offsets the prepayments.
     
  4. James Cormier

    James Cormier LawnSite Bronze Member
    from Ma
    Posts: 1,218

    If your just doing fert, like a 5 or 6 step program than I think it might be hard to get people to pay monthly, or sometimes it becomes a real pain in the a$$ when you got people paying differently. Ya know , some prepay, some monthly, some at time of treatment.

    I do like lawn doctors payment book, but the cost of doing something like that is not Worth it for small companies, if I had several thousand customers I would consider that type of payment.

    Im also considering taking payment online, it seems like more and more of us are doing everything online, so I plan to explore that, IM not sure how much more that would increase my website costs.

    I also do around 70% prepay, usually in Feb & March is when this income comes in. I offer 8%, I know Im weird, but you gotta be careful and know how to budget your money if your going to collect alot of income in a small amount of time


    all customers get a bill at time of treatment along with a self address envelope, pre paid customers just have no amount due. 99% of all customers pay within 30 days. If not they dont get the next treatment until last treatment is done. My apps are 42 days apart, so they just get a call a few days before they are due for the next round.
     
  5. TSM

    TSM LawnSite Senior Member
    from MA
    Posts: 707

    we started this season to offer a monthly payment plan (actually a 10 month payment plan...1st payment due in Feb- last due in Nov)
    we set this up through our realgreen software (basicly it prints out a coupon book, customer gets all payment coupons in Jan...they are responsible to remember to mail in the appropiate coupon and payment...we charge a $3 fee if payment reaches us late...we give a 5 day grace period)

    At time of application they get an invoice with the treatment cost and invoice is noted that they are on the monthly budget plan and do not need to send $$$ at this time.

    supprisingly many customers chose to go this route. We started 1st payment in Feb so by the time they get rd1 we already recieved 2-3 payments,depending on timing of rd1.
    has worked out well...no lost $$$ to prepayment discount for us and easy for customer. Many have set up with their on-line banking to automaticly send us the monthly payment so that means no chasing after $$$

    Some new customers went this route as well, for them they had to pay us the Feb, March etc payments....in other words we set all monthly billing to start in Feb and all due dates for the 25th of the month. We could have started them on any month but to keep it simple on our end we just make Feb month one. (a new customers starts in May they need to pay Feb, MAr, Apr up front and begin mailing the coupon starting with the 25th of MAy).

    We still do offer a prepayment for those who wish to prepay for the entire season in Jan or Feb. We have offered as little as 6% and as much as 10% for a prepay discount. We average 30% of customer base prepays.

    Personally, I wouldnt mind getting that 30% down to around 20% and get many more to go the 10 month budget plan.
     
  6. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    all payments, for entire program, due in full, at time of signing
     
  7. jajwrigh

    jajwrigh LawnSite Bronze Member
    Male, from Martinsville, IN
    Posts: 1,405

    You must be a budgeting wizard to manage all cash flow up front like that for the whole season.
     
  8. jajwrigh

    jajwrigh LawnSite Bronze Member
    Male, from Martinsville, IN
    Posts: 1,405

    You must be a budgeting wizard to manage all cash flow up front like that for the whole season. Cheers to you! Have one of these... :drinkup:
     
  9. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    i never have just one
     
  10. jajwrigh

    jajwrigh LawnSite Bronze Member
    Male, from Martinsville, IN
    Posts: 1,405

    or two... :drinkup: :drinkup:
     

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