question on commercial billing

Discussion in 'Lawn Mowing' started by GarPA, Apr 26, 2002.

  1. GarPA

    GarPA LawnSite Silver Member
    from PA
    Posts: 2,585

    just landed 2 (same owner) nice commercial of 6 acres....wide open, almost no trimming, clean up, corner properties with high obviously good for my business visibility..owner is a great guy...I know him personally...even so being a small operator I dont like working for a month and then waiting 2 more weeks for payment. Do many of you bill accounts up front? thats the way I'm leaning on this one..we all handle receivables in different ways so I'd appreciate your point of view...thanks much
  2. Even my residential accounts don't pay in two weeks.

    This guy's doing you a favor expediting your pay so quick.

    Some of mine are 90 days. But what do I care, it's all spent by the time I see it anyway.:D

    If you want business accounts, you have to operate in a business like fashion. That means giving them time to do their business. Most businesses try to have their accounts paid in 30 days from the time they receive the bill.
    So when I send the bill for the mowing done in the month of May, they receive it in June. If they issue a check in July, that's 30 days (to them).

    If they owe you $1,000 for a couple of months, you're talking about ten bucks in interest charges.
    People are loaning me money at less than 6%, so I figure the cost of money at about 1/2% per month.
    It's not really worth hasseling them over. Or loosing the account over.

  3. Tim Baden

    Tim Baden LawnSite Member
    Posts: 57

    I used to mow a Wallgreens there billing was 45-60 days.Like Dave said he is doing you a big favor.
    And to mow 6 acers wide open you got it made,the last thing I would worry about is waitng 2 weeks.
  4. bruces

    bruces LawnSite Senior Member
    Posts: 648

    Seems that we have the ability to negotiate terms on each account we sign up. If the customer will agree to prepay, great, same with billing every 2 weeks, etc.

    Whatever you can get the owners to agree to, make it part of the service agreement.

    Obviously, with larger comanies a lot of times it is "their way or the highway" as far as billings and payments go, but on locally owned accounts, the billing terms could be part of the proposal and tailored for each account.

    The other thing I look at is even though it is tough for the first month, it will be nice to have those checks rolling in in November and December when I'm not doing much work.
  5. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Posts: 1,913

    30 days net is normal
  6. GCS LawnService

    GCS LawnService LawnSite Member
    Posts: 75

    I bill my commercial accounts monthly but you could ask them about bi-weekly. I do sub-contract work for another company and they pay me weekly for whatever job I do for them. Hope this helps.

  7. Brickman

    Brickman LawnSite Bronze Member
    Posts: 1,249

    If you are paid with in two weeks after you bill them, you are doing very good with commercial. Most will wait as long as you will give them. One thing that I have tried is to bill at the first of the month, this is for accounts that have the same price month after month, not per price work. That way by the time 30 days is up after you bill them, the month is over, and presto, $$$$ in the bank.

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