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Discussion Starter · #1 ·
Has anyone thought about 2023 contracts yet? I am currently slowly going over things as we send them out in January.

What kind of increases are you guys doing for 2023?

Is it a bit too early to get a solid idea on price increases?

Increase on mowing? Maintenance? Landscape work? If so what kind of increase?

Percentage?
 

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I did such huge price increases earlier this year, I won't do them again soon. Plus, many are saying the economy is going to get worse in 2023. I'm doing just fine but some of my businesses may have to tighten their belts next year. I don't think they'll leave me but they sure ain't gonna want to see another price increase.

I hate to be a downer. Next year, I'm focusing on cutting costs.
 

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I too did very large increases on both the mow and the application side. But I’m not yet going to say no to another. We are at 40 year high inflation with really not much slowing in sight. I’m my mind I’ve tabled the issue. I do not want to do another increase but I’m not going to lose purchasing power as I am in the same boat as my customers are in. Unless something out of the ordinary happens I can see a max 2% across the board. I did a 12% last year and only lost one customer out of 400 recurring customers due to that increase.

edit.. I misspoke the average increase was 12% but the actual ranged from about 5 to a max of 20%.
 

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I did a major price hike across the board this year. In my market, all materials have gone up in price about 1% - 5% per month, every month. Bulk landscaping supplies, even more. Examples include mulch in January of '22 was $30.00/yard, now it's $45.00/yard. Pea gravel in January of '22 was $48.00/ton, now it's $94.00/ton. Most common trees/shrubs at wholesale were $4.00/gallon, now $7.00/gallon. Pesticides and fertilizer has all doubled or tripled depending on the specific product.
I will try my best to keep grounds maintenance prices where they are now in '23, but don't think any other services will be profitable without a price hike. My expenses are higher just like everyone else's, and I have profit margin benchmarks that need to be met.💵💰
 

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In fert and squirt trying to find a good balance right now is like trying to spit into the wind and not get hit. I’ve got no good answers we are just trying to price to afford but at the same time remaining competitive.
 

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We don't have recurring contracts and I already did 2 good price increases this year to account for next year. What we quote for landscaping work is not based on inflation, it is based on our overhead which is always changing. Every 3 months I add up all of our overhead costs and make a break even rate. The biggest increases I see would be fuel, replacement for new trucks in the future (expecting 30-50% more for a new truck than the ones I got in 2018 and 2020) and labour costs (starting employee wages up $5-7/hr this year). So our breakeven is now $60/man hour CAD and includes owning a small excavator on payments. Probably closer to $65. Pricing jobs at $100/man hour, was $70 just last year. Gardening is 85 and irrigation 97.50, hedge trimming 95, prices hourly and listed on website.
 

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As far as price increases, I really can't say from where I am now...
Specifically it hinges on where the economy takes us, if this inflation continues then I will likely have small choice in the matter however I am presently comfortable with my prices.

I will say this...
Where I live, menial labor (such as fast food jobs) are presently paying $14-$17 an hour.
Get a forklift license for like $50 and the pay goes up to $20/hr (experience would help).
So I'm not terribly afraid to raise my rates if I need to.
 

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Not going to increase across the board, I did 15-20% in the spring but I’ll look at individual accounts and raise the ones I should be making more on, drop the ones that are a pita. Waiting on fert prices before I raise across the board but I really don’t want to.
 

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Has anyone thought about 2023 contracts yet? I am currently slowly going over things as we send them out in January.

What kind of increases are you guys doing for 2023?

Is it a bit too early to get a solid idea on price increases?

Increase on mowing? Maintenance? Landscape work? If so what kind of increase?

Percentage?
Im not raising prices by much… just making sure ALL my work bills out @ my hourly $ goal. started loosing way too many bids @ over $70+ hr. Maybe the sticker shock due to the increase in materials - maybe too much competition n my area - maybe the economy. Idk. but I think there is a limit to raising prices. I’ve said it many times - better to run lean and mean vs buying the newest biggest and baddest of everything … especially w equipment prices being so expensive.
 

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Discussion Starter · #17 ·
I think now and beyond is the time to be that high end company in the area. We Operate with three mow guys Monday-Friday and myself and one guy landscaping Monday-Friday. This year has been great, we didn’t bring back two guys. And the 4 I have are all being paid very well and are very happy. Any work that came in (new home owners, new commercial) we priced almost double. From mowing to maintenance. Double. Most we didn’t get. But the ones we did are happy with our work and extra butter on the biscuit!

mowing might have a cap on price. But some will call and want you for the reputation.
 

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Over the past 27 years of doing this lawn care thing and being one of the original Lawnsite subscribers I will say that this topic (and pricing in general) is by far the hardest part for many to grasp. I sure am no mr know it all and still learn every season but I see lots of guys in my area come and go. You will see the flash dudes who have a brand new dually pulling a new 26 ft aluminum trailer with 3 exmarks on it. 2 or 3 years later there is no sign of them. Or the guy with the 42 inch Murray working for cash to Johnny working for a popsicle. All have different business plans or none at all.

I look at my numbers frequently and I will say that these last 2 years have been the most challenging from a business standpoint. However I am still in business and making money. Has it been simple, not really but I know what comes in and more importantly what is going out and I set the price and stick with it. The mowing and applications part are the easy part of this business. It can be physically demanding at times and you have to be able to get off your ass and do the work but equally important is knowing your costs. It can be a detailed process for me but it helps keep the business moving. I am a solo operator and have been forever (my wife is the important part by doing all the books) so I cant speak to the crews or guys running big operations but what I do works for me.

So will there be a price increase next year for my customers? At this point (just ending the season) I will say I give me 3 months to answer. Too many what ifs right now. I will lean towards yes. I will also say that hopefully the will be nowhere near what they were this year. I now do spring and fall cleans, weekly mows and the biggest part of business, applications. I will examine the climate of each at the end of winter to see what I will do for pricing. I could not imagine the fertilizer price increases I dealt with this year. If they stay the same then the increase will be minimal BUT if they are going to raise more then hard decisions will have to be made. Gas, insurance, cost of raw materials, maintenance, repairs and on and on. All are rising. We also sometimes forget that somewhere in there has to be PROFIT. After 27 years I have almost fine tuned my customer base to what I need. I do have almost 100 applications customers and a handful of weekly mowing with the one timers in spring and fall so I am always adding and subtracting customers but I have a great core and they do understand when I have to increase.

Sorry for the novel but my whole point in this is that you can only determine what works for you. Each market is both the same and vastly different. Pricing is so area dependent that it should be a crime for people to answer the question what should I charge? I wish you all the best because its the toughest but most necessary part of running this business. Very good question that hopefully gets a lot of people looking a little deeper into your finances.
 

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Definitely will have price increases across the board come spring. We may raise our minimums again, cut back on some service areas and we have reassessed certain customers that aren’t “bad” but certainly underpriced for the work involved.
 
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