(Another thread about) How to raise your prices!!

mmrogge

LawnSite Member
I own full service lawncare business with 75 accounts.
75/25 residential vs commercial.
Some of my customers are paying the same price going back 3+ years.

Lawn equipment has gone up in price. Fuel has gone up in price. Insurance has gone up in price. And now my guys are asking for an increase in pay.

Everyday I absorb all these costs. I've learned to work more efficiently. More lean. And offer more add-on services to make extra money. All new customers are paying me higher and higher prices. But I've always been very reluctant to raise prices to existing customers. Some have been paying the same price for 3yrs. I wish that ANY of my business or personal costs were the same as 3yrs ago.

Inflation is 3.22% per year on average. They're saying its at least 5.39% this year. I'm no economist but understand that this means that on average, prices are going up by 5.39% just this year. That we can choose to raise customer prices by 5.39% just to keep pace with nothing more than inflation. That if we don't raise our prices we are ultimately WORKING FOR LESS MONEY year after year. I don't feel that you should need to work more and more every year just to make the same money.

I want to clarify that I'm blessed lately. Things are good. But all my bills have increased. Shouldn't what I bill for lawncare? I've owned the business for 3yrs and haven't ever raised prices for existing customers. I know that I shouldn't be afraid to raise prices.... that it's a fact of life. I'm just concerned as to how these sort of increased have been received by others and what's the appropriate notice to give everyone. My average increase is going from $50 to $55, or $65 to $75.

Thank you all for the help.
 

gcbailey

LawnSite Gold Member
Location
WV
Business is business.... We raised prices across the board at the start of the season between 5-10% hadn't raised prices in 5 years. Most clients will understand. They see it at the grocery store, fuel, home goods, etc.... The only thing that we did was sent out a letter stating something along the lines of "blah, blah, blah cost of doing business, fuel increase, basically everything increase, we have no choice but to ...."

We lost 3 clients to people getting high school kids cutting their lawns and 2 of those the kids already quit.

For some reason it seems like the majority of people just don't see the lawn care industry in the same light as other professional services and that's probably due to the fact you can have anyone and everyone out there attempting to provide services at any cost without them realizing their true costs.
 

Advance_lawn_care

LawnSite Senior Member
Location
AR
I always advise people to raise the price on 1/3 of accounts every year anyone who hasn't raised them for a while, I advise to start with the lowest/worst paying 1/3 then as soon as you can after this raise the next lowest/worst paying 1/3

I just learned this this year. It helps to have high new customer call volume tho. I plan on raising prices on a bunch in spring and any who drop me I can replace easily with new customers.
 

kemco

LawnSite Fanatic
Location
Memphis TN
Yep about 30 to 40 of our almost 400 customers got price increase last year. All or darn near all will this year. Have to. I'm now of the opinion who sticks with me great. Who doesn't I don't care they can find a scrub who will do a scrub level job. Since the lack of help we need to cull around 50 customers at least from my rudimentary math on the back of a napkin so we aren't running crazy just trying to keep up. And oddly enough I told myself no more weekend work. I'm tired of having this business run me. If we can't get it done by Friday (assuming my skeleton crew worked 5 full days) it's pushed to Monday. Rinse and repeat.
 

GRANTSKI

LawnSite Silver Member
Location
Ct Shoreline
I just raise them and put the new price on the invoice. What’s 5% on a $50 lawn ? 2.50 ?? Raise em $5 and be done with it.
I raise price on about 1/4 of my lawns every year. Most don’t even question or mention it. The ones that do I give an explanation but keep it a little more general like… “your lawn takes a little to long for us to make profit @ the existing price”. I don’t blame gas prices since they fluctuate and is a Write off. Don’t want a person w business knowledge to call your bluff (for example the mileage write off actually pays more than what you spend on gas if you have a smaller low maintenance truck).
But again the way I do it is just put the new price on the invoice . No explanation unless they bring it up. Only lost 3 this year that were already switching to a cheaper service. Go ahead … fine w me … now some other fool is cutting them for $10 lower than I would’ve been … so now they need to raise prices just to get to my previous price lol. Suckers lol. One thing I won’t do is compete w low ballers. In my area enough customers value experience and reliability …loosing someone over $5 is a blessing. Screw anyone that will fire you over such a small amount. .
 

andersman02

LawnSite Bronze Member
Location
Snowy MN
Just don't raise them across the board, the same amount, that's bad business imo.

Have a set price for time, raise all the customers 2-10% to get closer to that time. Good profit ones get minimal, poor profit get higher increase
 

Tn Turf

LawnSite Senior Member
Location
Spring Hill, TN
Do an audit and raise the PIA accounts first. Make personal calls to clients, don't text or send a generic letter. Explain to them repairs have gone up, equipment prices have gone up, labor has significantly gone up, etc.

We raised prices and lost 0 accounts using this method. Obviously you're going to raise prices now for any new prospective client. Our new 'higher' prices haven't been an issue. We still land 99% of every account we choose to accept (we are very picky on what yards we are willing to mow). We charge roughly $5.60 per minute for mowing. A tiny flat yard with no fence w/hardly any edging might take 8 minutes and starts at $45 to $55. A 12 minute yard, is $65 to $70. An acre with little weedeating might take 23 to 25 minutes starts at $115.

We tell our prospective clients up front our prices are significantly higher than anyone elses, and they acknowledge we are higher than our comp. But at the end of the day people want superb customer service, reliability, real human-to-human english speaking communication, and high quality work. That's what they really want and are willing to pay for. Nobody provides it anymore.

Gone are the days of $35 / $40 lawns. Not when fast food workers are getting $15+ sign on bonuses and still put the hamburger bun on upside down. Inflation just hit us all right square in the face... and nobody wants to work anymore.

The reality is we are living in IDOCRACY times. That movies was funny, but now it's a blueprint to what's currently happening.

/END-RANT
 
Last edited:

GRANTSKI

LawnSite Silver Member
Location
Ct Shoreline
Do an audit and raise the PIA accounts first. Make personal calls to clients, don't text or send a generic letter. Explain to them repairs have gone up, equipment prices have gone up, labor has significantly gone up, etc.

We raised prices and lost 0 accounts using this method. Obviously you're going to raise prices now for any new prospective client. Our new 'higher' prices haven't been an issue. We still land 99% of every account we choose to accept (we are very picky on what yards we are willing to mow). We charge roughly $5.60 per minute for mowing. A tiny flat yard with no fence w/hardly any edging might take 8 minutes and starts at $45 to $55. A 12 minute yard, is $65 to $70. An acre with little weedeating might take 23 to 25 minutes starts at $115.

We tell our prospective clients up front our prices are significantly higher than anyone elses, and they acknowledge we are higher than our comp. But at the end of the day people want superb customer service, reliability, real human-to-human english speaking communication, and high quality work. That's what they really want and are willing to pay for. Nobody provides it anymore.

Gone are the days of $35 / $40 lawns. Not when fast food workers are getting $15+ sign on bonuses and still put the hamburger bun on upside down. Inflation just hit us all right square in the face... and nobody wants to work anymore.

The reality is we are living in IDOCRACY times. That movies was funny, but now it's a blueprint to what's currently happening.

/END-RANT
Disagree w giving your customers the sob story R.E.M. it’s the end of the world rant over a $5 price hike. Just do it. No need to add to their stress ppl are tired of the political talk. You’ll make the $5 raise stressful on the customer when they probably woulda just accepted it without explanation.
 

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