Very Interesting Statistic (Long Post)

Discussion in 'Lawn Mowing' started by DFW Area Landscaper, Sep 11, 2006.

  1. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    I got out my spreadsheet today and studied EVERY cancellation I took between April 1st and September 1st of this year.

    During those four months, I took 65 cancellations from mowing clients.

    The study confirmed what I was suspecting, but I didn't suspect it would be this big:

    Of the 65 mowing clients who cancelled, 95% had taken less than 4 chemical treatments and the majority, 80%, only hired us to mow the lawn and never took any chemical treatments. Only 5% of those cancellations were clients who hired us to mow and do the chemical treatments AND had taken at least 4 treatments.

    As of today, 48% of our mowing clients also take chemical treatments. The ratio of cancellations from mow-only clients, as compared with our client base, clearly indicates a much higher potential for mow-only clients to cancel service.

    The chemical treatments appear to be a barrier to entry, at least in the client's mind. They are happy with the way their lawn looks and don't want to screw it up by making a switch on any facet of their lawn care.

    I wish I knew what percentage of those 65 mowing clients cancelled because they hired someone with a lower price. My guess is, a lot of them cancelled for that reason, although I have NO way of knowing for sure.

    My point is, the clients who have us do the chemical treatments and mow are not cancelling. It's the clients who just have us mow the lawn and possibly a clean-up...those are the clients who are churning, over and over again.

    Sure, we like to have the chemical business, but the real ambition here is to have the mowing business. Just think about it: 34 cuts per year and only 6 chemical applications, many of which require a call-ahead the day before. Which revenue source would you focus on?

    I guess the question is tree-fold:

    1.) If a client is already with Trugreen or another provider of chemical service, if they don't switch to us for chemical and just hire us to mow, are we just as disposable? Or do these clients tend to hire and keep one lawn mowing company long term too?

    2.) Is it possible to create a convert? In other words, a client orders weekly mowing but doesn't have a chemical service and they decline our chemical service. Is it worth it to give this client the first three apps for free just to get them to try it out and then see if they will pay for it, all in the hopes of getting a long term client who will be loyal?

    3.) Would you dare consider, in the areas where the schedules are nearly full, REQUIRING clients who want lawn mowing to also take your chemical treatments too?

    Later,
    DFW Area Landscaper
     
  2. evergreenedmond

    evergreenedmond LawnSite Senior Member
    Posts: 310

    We do all or nothing, I think it helps weed out the people looking for the lowest bidder.
     
  3. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    I'd like to know your cancellation % from moving people's mowing schedule around like you were worried about.
     
  4. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    ++++I'd like to know your cancellation % from moving people's mowing schedule around like you were worried about++++

    We had to ask 122 clients to move at least 2 days earlier in the week. Some were weekly, some were bi-weekly.

    We normally see around 4 cancellations per week. Over the last two weeks, we had 12 cancellations. At least two of the cancellations are suspected dissatisfaction from us mowing in the rain when the clients were home on Labor Day.

    Additionally, we have another 6 clients who are allowing us to mow on the day we prefer for 2 ro 3 weeks and then we will see if there is enough time savings to accomodate their requests. We have already caved on one because she schedule her day off from work to be home when we mow and she is not far out of the way. The other five all have to be addressed and I don't know if we will cave or not.

    The good news is, it has rained on three Mondays in a row and the lawns are growing, despite less sunlight. A year ago, the phone was ringing non-stop with skip & cancellation requests because it hadn't rained in 6 months.

    I just found it amazing to see that only 48% of our mowing client base takes our fert & squirt, but 80% of our cancellations over the last 4 months were from mow-only clients.

    I find it NEXT TO IMPOSSIBLE to get someone to take our fert/squirt program if they sign up for service after dandelion/poa annua/henbit season is over.

    With applications costing next to nothing in November & January (no nitrogen) I wonder if it would be smart to offer 6 months of free fert/squirt to the mow-only clients as long as they remain on the mowing schedule? The cost is low and from what I can see, it keeps them on the mowing schedule.

    Later,
    DFW Area Landscaper
     
  5. MMLawn

    MMLawn LawnSite Gold Member
    Posts: 3,569

    Sounds like you are losing clients just as faster....or faster than you gain them.....normally to that I'd say you need to stand back, take a long hard look and re-evaluate how you are running your business and responding or more importantly failing to respond to your clients needs....
     
  6. topsites

    topsites LawnSite Fanatic
    Posts: 21,653

    Here, I'll summarize it for you:

    It's always the people who want something for nothing who will skeedaddle the fastest.
    As a rule, 9 out of 10 will do so.

    ////////////
    Lawn service customers either get on board with me before spring is over, or they can find someone else.
    I don't take on no more grass customers once the temps hit 90, and I sure as hale don't take them on after it cools off again, either.
    That saves me a lot of headaches from the funny people who really just needed some slave boy to cut the grass in the worst heat (gee now it's nice and cool, why not cancel honey?) and also the funny people who like to come onboard right about now but their real reason is they need a slave boy to do their leaves. Oh yes, good times, good times.
     
  7. dlm17

    dlm17 LawnSite Member
    Posts: 102

    How Do You Lose 65 Clients And Not Look To What You May Be Doing Wrong I Havent Lost 65 Clients In 10 Years
     
  8. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    Do you track WHY they cancelled?? You won't always get the honest truth from a cancelling customer but never hurts to find the reason.
     
  9. Precision

    Precision LawnSite Silver Member
    Posts: 2,995

    different business model. He is targeting mow and blow people at a set price point. There is gonna be churn and burn there. But carrying a load of 300+ accts helps to make up for that.

    If you lose 4 but gain 5 and each is committed to a 6 cut minimum AND you aren't personally doing the labor, who cares. Its all about the net result. MONEY.
     
  10. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    I have compared notes with justmowit and my churn is not alarming for the mow-only clients. What I would like to do, and have been doing, is get away from the mow-only clientelle and replace them with mow/fert/squirt clientelle. Believe it or not, it is a lot of work to sell the service, set them up in the schedules, print and mail the welcome letters, set them up in the billing system...only to see them cancel sooner rather than later.

    And that is the whole point of this thread...when you just mow the lawn and perhaps trim the shrubs...you are totally disposable, and the numbers back that claim. ANYBODY CAN DO THAT, INCLUDING THE CLIENT. But when you make the weeds go away and the grass is green, they are far less likely to cancel.

    What I can't figure out is, if you do a search on the word "churn", outside of my own threads, no one on LawnSite ever talks about it. Guys on here say they lose less than 10% of their clients per year...I simply don't believe those numbers unless they are servicing only the wealthiest of clientelle. I lose an average of 22% of my total client base every six months. I probably lose 10% of my clients to moving and that is but only one reason of many for client cancellations.

    The truth of the matter is, most americans probably can't afford a lawn service for the long haul, but that doesn't stop them from signing up and becoming customers of the industry for a time...and I would guess those clients are mostly mow-only clients. I am not naive enough to think that when a client signs up for lawn mowing they are making a life long decision. Many clients tell us up front, when they sign up, it is only temporary...they just don't have time to mow the lawn due to business travel during the next few months or they have a new born or they have a mower in the shop or they just moved in and they haven't had time for the landscape yet.

    The point of the thread was that I noticed a tremendous difference in cancellation rates with mow/fert/squirt clients vs mow-only clients.

    Does it make sense to give away the fert/squirt for a few months in the hopes of keeping their long term mowing revenue?

    As for the clients who already use a competitor for squirt/fert, are we any less disposable as a mow-only service to them than we would be if they didn't use a fert/squirt service? Phrased another way, how important is if for the lawn mowing company to steal the fert/squirt business from a competitor?

    Later,
    DFW Area Landscaper
     

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