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Your thoughts on Business and Marketing plan

Discussion in 'Starting a Lawn Care Business' started by HeloPilot, Jun 23, 2008.

  1. HeloPilot

    HeloPilot LawnSite Member
    from Texas
    Posts: 36

    I have been working on some ideas for several months. I want to get in, but I want to do it right. I am now ready to take the jump and drop the money for the right equipment. Some background on my community. I live in a nice middle-class community in Texas that requires year-round service. 21,000+ single family households. In my division there are 1600 homes all within 2 mile radius. All of these homes are less than 5 years old. These homes are split between 16 neighborhoods.

    Desired Equipment:
    12' landscape trailer with 4' walls
    36" walk-behind..... undecided brand
    21" Craftsman walk-behind....... my current mower
    stick edger.... probably echo
    trimmer...... probably echo
    backpack blower..... again probably echo
    misc hand tools

    My goal is 60 accounts in the immediate area and this immediate area only averaging $25 per cut. That would total $1500 per week. I know many of you think of this as the Wal-Mart theory and not realistic. If you see a realistic flaw in this with constructive criticism, let me know and help me out.

    Here is my idea on gaining these accounts. I have had some great experience with running small business's. This is my first run at the LCO business.
    My original plan was to do postcard mailers to all 1600 homes. the USPS cost would be $675 plus $250 for the mailer and the time to address each mailer. I know that there are options to do mass mailers, but I want to focus on this specific small area right now. Instead of mailing I am going to hand deliver these to the doors with the help of my wife and 2 kids.

    An incentive that I am planning is a $25 gift card immediately delivered at the "scheduling" of service. I initially said Home Depot, but my wife said I should consider Target in order to target the housewives that we all know make the decisions like that around the house. And what woman doesn't want a "free" $25 gift card to Target which is right around the corner. I think that I offer both and purchase at a 70/30 split to start off. I plan to offer this to the first 60 costumers. But heck, I am willing to give it to EVERY customer if thats what gets the sale. My wife had a concern about people receiving the card and than canceling the service. My way around this is to give it to the with the "scheduling" of service. I am not to worried about losing money on this because one cut covers the immediate cost of the gift card.

    Anyhow, tell me what you think. Good, bad or in-different. I am very interested in your thoughts. Im sure its not fool proof, but I want to make it the best I can.

    Thanks for taking the time to read this and hopefully participating in the future success of my business.
  2. MowHouston

    MowHouston LawnSite Bronze Member
    Posts: 1,012

    You're starting off way too desperate for work by offering a $25 gift card to every customer. Do something that isnt going to take away your profit from your -very- first mow. One of the things I offer is 50% of the SECOND service (lawn service only) You're looking at spending $1500 in the gift cards alone for those customers.

    1600 mailers will probably get you 16-20 customers. Marketing media such as door hangars and postcards usually get a 1% conversion rate. And to be honest, I cant remember if that is actual customers or just leads (you may not get every bid). At this point, you're looking at spending $80-$100 per customer in the first place.

    Thats $105 - $125 per customer if you do your gift card idea. Averaging $25, you've gotta service each customer 4-5 times to even break even with GROSS income. But wait, you've gotta spend gas to get there 4 - 5 times first. See what I mean?

    Tell me what part of Texas you are in, I may know another option for you that depends on your location.
  3. MowHouston

    MowHouston LawnSite Bronze Member
    Posts: 1,012

    Oh yeah. Also. dont measure your average as $25. That better be your minimum. I'd hate to see what your minimum is when averaging $25 per service :)

    My minimum is $25 but I average $40 per cut. This is, of course, because I have $60 mows that raise that average.
  4. k911lowe

    k911lowe LawnSite Senior Member
    Posts: 526

    did you try advertising in the local paper or the yellow pages.more professional than door hangers or business cards in a sandwich bag weighted down with rocks.don't try your get rich schemes in the lawn service.they wont work.have you had any small businesses that provided professional services?
  5. HeloPilot

    HeloPilot LawnSite Member
    from Texas
    Posts: 36

    The gift card idea is a simple business school marketing technique. People don't notice that they saved a little on scheduled service. It means very little. They dont even notice a difference in the billing unless they are on a strict household budget which more than 85% of the population are not. People do remember spending that "free" money.
  6. MowHouston

    MowHouston LawnSite Bronze Member
    Posts: 1,012

    Ehm... I think doorhangers/mailers are a tad bit more professional than the yellowpages and the newspaper.

    Phone book is expensive from what I hear (for the ads that actually catch attention) Unless you wanna name yourself AAAA11111 Lawn Care so you are at the top.

    Newspaper ads only work well in smaller cities.

    Doorhangers and mailers need to be professionally done (not off of a printer or even 2 color ones from the internet) But the nice glossy ones that make you look like a professional business.
  7. HeloPilot

    HeloPilot LawnSite Member
    from Texas
    Posts: 36

    Yes I have operated two very service business that grossed around $150k annually netting around $90K. Both were later sold to customers quit ironically for a healthy payday. I can attribute both of my success's to providing "free" money to my costumers to bring them to the table. remember, it isn't really "free". The mount is immediately returned to the company funding after the first week. This concept is equal to working for a week free for years worth of payoff once you get them in and keep them happy. The goal is to get, or take, the customer with the "free" money and keep them with quality.

    I know better than weighing down trash and throwing it on my neighbors driveway. Sad, pathetic and stupid!!

    This is my first go at it here in Texas.
  8. MowHouston

    MowHouston LawnSite Bronze Member
    Posts: 1,012

    Thats not the point. The special is to BRING the customer in. Not to worry about what they remember about how they spent $25.

    My customers will ask to double check that they get the 50% off mow. People just care about saving money. However, you're spending 4-5+ times what the customers is paying you just to land the customers. You're starting a small business in the lawn industry, it seems like a waste of time to do a month's worth of work to gain a customer before you start to see any profit.

    I spend about $12 landing a customer through my advertising, and then $12.50 - $20 on the 50% special. 35 customers in two months. I'm gaining profit by the second service. I've only got my GED and obviously never went to business school. But I dont think your marketing strategy is a good one.
  9. k911lowe

    k911lowe LawnSite Senior Member
    Posts: 526

    door hangers and other soliciting are not professional.if the yellow pages were expensive,i couldn't afford them.most communities do not allow soliciting,at least in this state they don't.whoever told you door hangers or mailers were professional needs a reality check.that's mickey mouse.people look in newspapers for the area phone numbers or addresses,not for AAAAAAaldrich lawn service.thats what the dumb asses do who are just in a hurry.they don't make good customers either.
  10. MowHouston

    MowHouston LawnSite Bronze Member
    Posts: 1,012

    You need to wind yourself down. Be a man and talk like a gentleman and not like some crazy podunk that knows it all.

    Some people that use mailers and doorhangers: Comcast internet, Dominoes Pizza, Scotts (I think they make a bit more than me AND you in the green industry).

    And I believe if you'll look back in the searches, you are one of the VERY FEW that has success with the phone book. Many people claim doorhangers/mailers are the best all around media. Newspapers are good if they are small local papers. I prefer the internet because I'm of the millenium generation and live in a large city and I can tell you that it is the BEST advertising out there if you live in a large city.

    So like I've been saying, you might want to ASK where they are from before you spout out that you know what is best for other companies, thats why I asked in my very first post. Perhaps since you aren't from Texas and arent sure of our regulations, you shouldnt be claiming that those are the best medias for advertising.

    By the way, we dont even own a phone book. Got 5 of them last year and they made good fireplace kindling.

    Now to stop hijacking, we can get back to HIS business plan and HIS marketing.

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