Should prices be lower because of efficiency?

Discussion in 'Lawn Mowing' started by Lawn-Scapes, Sep 3, 2004.

  1. Lawn-Scapes

    Lawn-Scapes LawnSite Silver Member
    Posts: 2,810

    10-15 years ago the price to mow an acre would cost you $75 around here... now it's $35. Why? Because equipment is more efficient... right? Doesn't the equipment cost more?

    Why shouldn't we be making the same money ($75/acre) that people were willing to pay 15 years ago? People were making less back then and paying more... they're making more now and paying less. This doen't make sense to me... does it to you?

    I have always thought there should be a standard price for mowing... for example $1.25 (or whatever) per thousand square feet and then add in X dollars for degree of difficulty. However people argue that you should base your price on what you need to make per hour... or Joe Blow with the 36" walkbehind can't do it in the same amount of time as the guy with ZTR.... so he needs to get his hourly rate. I say too bad for him.

    If there were more of standard price in this business people would be looking for the best instead of the best deal...
     
  2. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    It aint ever gonna happen Tom. The best thing that happens is a bunch of people on this site won't be on it in 5-10 yrs. COLA goes up and our prices come down, if you have'nt planned ahead 25-35 yrs you just won't make it in the long haul.

    Mac
     
  3. locutus

    locutus LawnSite Bronze Member
    from NC
    Posts: 1,266

    No prices should not go down due to efficiency. Profits should go up. The newest technology and goodies that create this efficiency generally cost more as well.
     
  4. impactlandscaping

    impactlandscaping LawnSite Silver Member
    Posts: 2,332

    We have some accounts that were with us from day one. Some of these used to take an hour with 21's, and now take 12-18 minutes with larger, better mowers(STANDERS!!) I have raised everyones prices about 5-8 % per year over the last 5 years, and no one complains about paying more for less site time.It's good to have quality minded clients. It just depends on where you are and who your target base is I guess. Mac, some of these guys on LS won't be around in one year, let alone 5. They pop up all over in the spring, and are ghosts the following year....more $$$ for me..:D
     
  5. dkeisala

    dkeisala LawnSite Senior Member
    Posts: 911

    It's far more efficient to build a car these days than it was 100 years ago but they certainly aren't any cheaper.
     
  6. jphag

    jphag LawnSite Member
    Posts: 219

    You need to charge what you feel your worth. I aim for a $1 a min. on residential or $5 per 1000 sq ft for commercial properties. However, I do have a few old timers that only want 21 inch mowers on there property so I am up front with them and tell them it will cost more due to the extra time it will take me.
     
  7. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    Yes Bill there are a bunch that never survive the yr. those are not the ones I was talking about. I was refering to the guys that loose a few accounts to a lowballer and starts to panick or doubt himself and lowers his prices to be competitive thus lowering the prices for all lco in the area. And then after 10 yrs wondering why he's in the same position he was 10 yrs prior. There's to many post about "I can't raise my prices or they will drop me" I'm saying if you don't raise your prices to keep up with cola you will be out of business. So your choice is will you raise them now when you need to and maybe loose a few customers or try to make it up with more customers at the lower rates. more productivity at the same price is a disaster waiting to happen. Price a new mower now compared to 10 yrs ago You need to generate more revenue to make the same purchase and you just can not do it with out raising rates. 10% a yr should be normal but its going the opposite way.

    Mac
     
    Kelly's Landscaping likes this.
  8. Lawn-Scapes

    Lawn-Scapes LawnSite Silver Member
    Posts: 2,810

    10% is a bit much.. don't ya think? Those that were paying $75 10 years ago would be paying around $235 now :eek:

    $235 an acre would be sweet :D
     
  9. impactlandscaping

    impactlandscaping LawnSite Silver Member
    Posts: 2,332

    Well said, Mac. I rarely lose a client due to price increase. If I do, I replace them with another, and move on. Most people(I say most..) are not so fixated on price that they are willing to switch services because their rate is going up 2-5.00 per week. The ones that are, are better off with Joe Blow and Go, not me..:D
     
  10. Lawn-Scapes

    Lawn-Scapes LawnSite Silver Member
    Posts: 2,810

    Oh.. I see now you said per year. I need some glasses
     

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