commercial vs residential

Discussion in 'Business Operations' started by Vanderhoff Landscaping, Jul 27, 2014.

  1. Vanderhoff Landscaping

    Vanderhoff Landscaping LawnSite Senior Member
    Messages: 396

    Hi all. I was wondering for those who are servicing both. What are the pros and cons to each? (Maybe I'm not wording this right but I hope you get the jist of it). Right now I currently only service residential properties but I am legit and am thinking about getting into servicing commercial properties. What can I expect when dealing with management, collecting payments etc. Like I said, I have been doing only residential properties but I feel like I'm cheating myself and I am thinking about expanding into the commercial market. Is it worth it or should I just stick with residential accounts? Any pros and cons or advise (good or bad) would be greatly appreciated.
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  2. JB1

    JB1 LawnSite Fanatic
    Messages: 5,904

    Residentials like to pay cash.
  3. whiffyspark

    whiffyspark LawnSite Fanatic
    Messages: 6,565

    I do commercial

    I get paid rain or drought
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  4. xstatikplus

    xstatikplus LawnSite Senior Member
    Messages: 299

    I do both and find a mix of both works for me. Commercial ring in easy money with less travel expense gas and wages. Don't think I will ever go solely commercial tho. A good friend of mine was solely commercial, his 2 contracts were 1)2 hospitals 2) 11 factories equalling 35-40/wk for himself and 3 employees. The problem he ran into...simply got under bid on both contracts and just like that bill collectors at his door and bye bye business. Like I said commercial contracts are great to have and easy money. Houses are safe....if you lose 5 houses to your 90 just say no biggie you'll get 5 new ones back in no time
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  5. Vanderhoff Landscaping

    Vanderhoff Landscaping LawnSite Senior Member
    Messages: 396

    I know it depends on the company paying but how long do you have to wait to get paid? Residentials that I have almost always pays on time. Do commercial accounts drag their feet with rendering payment? And lastly, how does one go about obtaining said accounts? When is the best time to inquire?
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  6. oqueoque

    oqueoque LawnSite Gold Member
    Male, from Jersey
    Messages: 3,505

    That is a good point. I do small commercial now. I stopped doing large commercial. I could have continued the large commercial if I wanted to match Brickmans or Moons pricing. The pricing they used gave me too low of a profit margin. They were pricing mulch at $40.00 a yard installed and cut/trim 8 acres of lawn for $230.00 a cut. The contract called for 22 cuts a year, so if it did not rain I still worked, even if at slave labor rates.
  7. oqueoque

    oqueoque LawnSite Gold Member
    Male, from Jersey
    Messages: 3,505

    The other draw back to large commercial is that they required more insurance than the minimum, and they paid very very very slowwwwwwwwwwwwwwwww. The last year I did it, I received the final payment for 2010 work in March 2011. It made me go back to smoking. The building was less than 50% occupied. Each building they owned was a Limited Partnership, so if they declared bankruptcy on that building I was screwed.
  8. Vanderhoff Landscaping

    Vanderhoff Landscaping LawnSite Senior Member
    Messages: 396

  9. dKoester

    dKoester LawnSite Gold Member
    Messages: 3,395

    I prefer residential. Easy to do. I don't have to worry about the competition eyeing the property for next years bid. My annual income is stable.
  10. TPendagast

    TPendagast LawnSite Fanatic
    Messages: 11,107

    I don't think thats exactly true, Todd Palin, Bristol Palin, both have lawns within 5 miles of each other, TONS of people know where they live.
    Dudes are always eyeing the properties thinking they can "make it big" if they did the Palin's Lawn.

    Honestly, the Palins know tons of people and Bristol grew up with a lot of guys who just "suddenly" became landscapers, so people are always hitting them up to do the lawn.

    So I guess that more or less depends on 'whose' lawn it is?

    No one's really jockeying for position to get the "mcdonalds" postage stamp.
    But it's also technically a commercial account.

    If you ask me, Residential is higher net. Commercial require less hands on management.

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