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Commercial Bidding - 12 month contract - Amortizing Costs?

BrendonTW

LawnSite Bronze Member
Location
Oklahoma City
When I'm putting a commercial 12 month contract bid together;

Do I need to figure up my monthly mowing price, multiply it by the number of months I will mow (9) and then divide that by 12 to spread out their cost for mowing over 12 months? I feel strange putting the monthly cost for mowing at a certain amount on a 12 month contract, and charging that full amount all year around.
 

Schuley

LawnSite Member
Location
South Central WI
I kind of do both. We only have 6 or 7 months of mowing, and most customers are just april-october. But the ones that are 12 months long I either bill them by what i do monthly, and in the off months their bill may be nothing, then bill for snowfalls, or I have a few that are seasonal price for snow, so I just add everything up and divide by 12. I also will be putting a early cancelation fee incase they bail at the end of summer, they would have gotten cheap mowing because the payments divided out by 12 made their monthly payment go down. Some people see a lower payment and jump on it.
 

Schuley

LawnSite Member
Location
South Central WI
I dont know.... thats how I do it, it can get confusing and i'm in the process of researching what would be the best way, so if you find something better....let me know!
 
OP
BrendonTW

BrendonTW

LawnSite Bronze Member
Location
Oklahoma City
I will! You do the same. Thanks.

I am giving a few extra options to my customers. They can have re-mulching included in the contract where it is amortized over 12 months, or it can be left out of contract. Also goes the same with other one or few time services.
 
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