Payment Terms

Discussion in 'Lawn Mowing' started by XOFMOT, Jul 3, 2001.

  1. XOFMOT

    XOFMOT LawnSite Member
    Posts: 161

    I see that most everyone on here will either pick up payment when they finish that property, or bill on a monthly basis. I live in the northeast and a season contract will consist of say..aprox 25 visits for lawncare, my question is...for example you have an account that you charge $50.00 per visit x 25 visits = $1250.00 for the season, does anyone who works only half the year in the lawncare end of this business take that $1250.00 and split it up over the 12 months of the year? This would at least give you some cash flow during the "NON-SNOWPLOWING" times of the winter months. Just a thought.:)
     
  2. Finecut

    Finecut LawnSite Member
    from IL
    Posts: 177

    How worried do you think people would be about keeping current with their payments in Dec., Jan., Feb.? My guess is not very!
     
  3. LoneStarLawn

    LoneStarLawn LawnSite Bronze Member
    Posts: 1,415

    I hope they would if they were under contract.
     
  4. XOFMOT

    XOFMOT LawnSite Member
    Posts: 161

    My thoughts exactly Alan!.......Customer still owes for my services, just making the monthly payment less$$$ for them by streching it over 12 months
     
  5. Evan528

    Evan528 LawnSite Silver Member
    Posts: 2,144

    what the advantage of getting your money over 12 months? Your getting the same amount of money!Is it just that you have trouble Budgiting your money?
     
  6. Eric ELM

    Eric ELM Husband, Father, Friend, Angel
    Posts: 4,831

    I agree with you on this Evan. I don't understand it either. I would rather work my 9 months and get 9 months pay 1 month at a time for 9 months and put the money to work for me, not let them have the use of my money.

    It wouldn't work out for us Northerners that plow snow anyway. We would have to add the snow plowing to bill and that would be even more confusing.
     
  7. XOFMOT

    XOFMOT LawnSite Member
    Posts: 161

    Evan,Eric,

    I have NO PROBLEM at all with budgeting. (I'm married,two children 4 & 6, mortage, and everything else, as well as a $2500 a year property tax for just a .11 acre lot!)PLUS my wife is MRS.BUDGET anyway (thank GOD)!
    I looking at it more from a customer point of view......When I went out and bought my new truck last year, I opted to pay it off in 1 year instead of all up front. Easyer on my wallet, even though I had all the cash to pay it off. (0% financing = a 1 year free loan to me). Within the next few weeks I'm going to be purchasing a large amount of equipment. I just received a credit card that I applied for that will give me 0% interst rate for all purchases until JUNE of 2002! I will take advantage of that!

    But on that same thought I also agree with your thoughts on this subject. This was just a thought that was in my head that decided to come on out. Yes, I would rather get paid IN FULL what I was owed at the end of the month.Thank you for your input!:D
     
  8. GreenQuest Lawn

    GreenQuest Lawn LawnSite Senior Member
    Posts: 822

    I offer Pre-pay, 8 Month, & 12 Month billing on all my contracts. To date no one has chosen the 12 month. I wanted a few to go with it for some extra cash in the winter but so far people seem to only want pre pay and 8 month billing.
     
  9. Comet

    Comet LawnSite Member
    Posts: 165

    Intresting, has made me edit a commercial bid possibly, I can see maintaining res only in 8 but

    Would this 8 month billing also apply to large commercial accounts over 100K in everyones book?
    or let them be able to budget that over 12 months?

    Snow is seporate on a yearly contract
    thanks
     
  10. Lawn DOG

    Lawn DOG LawnSite Senior Member
    Posts: 276

    I would say that the sooner you get your money the better. It is hard enough giving people monthly billing. Think about this. You mow a lawn on July 1st. You close your accounts on July 31st and send out bill on August 1st but don't receive payment until the Aug 30th. That is almost 2 months before you receive payment for services rendered on July 1st. They can't expect it to get any easier than that. This is the way I do it. Most people wait untill the last minute to pay their bills just like me. But if they forget I charge a hefty interest rate that is worst than almost any credit card. It is all in the signed contract. I have very few accounts that we do on hand shakes. Had to learn the hardway that not everybody is as nice as me.
    There are faster ways to get the money but we do cater to the public and try to make it convenient as possible because face it in the service industry people like convenience. It is not convenient to be bothered 4 times a month to pay the lawn guy.
     

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