Estimate / sign contract right then and there

Discussion in 'Business Operations' started by uniquechev, Feb 11, 2012.

  1. Roger

    Roger LawnSite Fanatic
    Messages: 5,943

    If there is nothing binding, why bother? It matters not one iota the name. If you want a signed document, then you want a binding agreement.

    For simple stuff, like residential lawn mowing, I suspect these "binding documents" quickly find the wastebasket when the owner gets inside the house. They know it is nothing they would plan to keep if they don't like your service. As for you, the LCO, I've read so many times, "two weeks notice, " or "one month's notice" to cancel. Why would you want to obligate yourself to a situation you wish to extradite yourself for two or four weeks? If the customer does not like your work, and they hire another grass cutter to begin immediately, what is your leverage?

    Remember, many of our customers are business people who deal with contracts, agreements, etc often in their work. Who knows more about these documents, somebody who does it for a living with high stakes, or the grass cutter?
  2. Roger

    Roger LawnSite Fanatic
    Messages: 5,943

    Sorry, forgetting to comment on the OP ...

    The 10% deal sounds like the local used car salesman, the roofing man, the house siding man, the ( .... ). If this is your profile of doing business, that is a good idea. If not, then perhaps you want to rethink that position. Not saying, right or wrong, just pointing out the image issue.
  3. uniquechev

    uniquechev LawnSite Member
    Messages: 119

    are you saying that less people are to look at your business for offering a new signup deal as a prefurred landscape co. compaired to a company that will just come in and not offer anything as a incentive to join their list of clients?
  4. MarkintheGarden

    MarkintheGarden LawnSite Bronze Member
    Messages: 1,140

    My experience is that customers are not all the same when it comes to closing the deal. It may be hard to believe, but some customers do not care about a ten percent discount. Some customers will be ready to close the deal when they hear whatever it is that they want to hear, and other customers will insist on taking a couple of days to mull it over, regardless of how well it seems like what they want.

    Like you, I want to go ahead and close the deal first meeting. What I try to do is after we have discussed the services and costs, just ask, would you like to go ahead with this? I do not offer a discount to entice them to go ahead and sign the service agreement. I do tell them that if we do, I can guarantee the costs as quoted for the year (no increases) and guarantee quality and reliable services. Also, I would be willing to give a one time additional service, like a small clean up or hedge trimming to close the deal.

    If you offer the ten percent incentive it might seem like you have inflated the cost by ten percent when you made the estimate. And it can be a big mistake to think that it is all about the money.

    Listen to what the customer says, and you will get good at figuring out what it will take to close the deal. I had one customer who had mentioned that he had talked to others and had planned to talk to more. I said, "If you want to go ahead with this, we can write it up today, I will put you on the service schedule, lock in the price for the year, and when I come for the first service we will remove that dead shrub for no extra cost. The customer signed up five minutes later. What enticed him was the prospect of being done with the issue and that I made him feel he could rely on me. He was also happy to have that dead shrub removed, but I am pretty sure he would have said yes, even if it would have cost him an extra $20. The point is he had heard what he wanted and came to feel that I was ready to deliver and that it would be a good arrangement. He was not planning on meeting with four or five people so he could get the best price, he wanted the right guy. Maybe it was because I was professional and no nonsense, maybe I seemed reliable, but I am sure that I did not offer the lowest price.

    When it comes down to splitting hairs and working out the details, I tell people that I am giving them my best price for quality, reliable, insured, services. I do not comprimise on the price or the quality and I cannot comprimise on licenses and insurance. But, if you are ready to go ahead and sign up today, we will get rid of those weeds in the rose bed and remove that branch that fell out of the tree before we leave today.

    People pay for what they need, but they pay well for what they want. If that branch that is laying on the lawn is bugging them, then having it removed is what they want.

    If you can say so, tell them that you personally will be present at every service visit. Many customers do not want to sign a deal with someone and then have them send over a bunch of goons that just got out of jail.

    I talk about mowing schedules, and ask if there are certain days and times when they do not want me to be working at their property. One of my customers works nights so we do not mow before ten am. Other customers do not want me on the property on the sabbath day, sometimes that means Sun. sometimes, Sat. I talk about making sure the gates are closed when we are done, and making sure the hoses are not run over by the lawn mowers.

    I find that by talking about these things customer service is already being provided and that they can count on it. Even if they do not care about Sundays or the gate, they feel that they have the right guy.

    Find out what they want and put that on the table. If you put discounts on the table you will get some business, but you will have to continue to replace that business with more discounts. If your business model is high volume low cost, then this can work very well. But even still selling your service quality rather than selling low cost will benefit you and help close the deal.
  5. MarkintheGarden

    MarkintheGarden LawnSite Bronze Member
    Messages: 1,140

    I use the term service agreement, because I think that some people dislike the word and concept of contract.

    The value of an agreement or contract (and legally the two words mean the same thing) is not whether or not it is binding, the value of the document is that it is informative. It informs the customer what services are to be expected and it informs them what the cost will be.

    I do not have service agreements for all my customers, but I am going in that direction because without something in writing, there are more conversations about services, and the door is open for a disparity about expectations.

    I do not give a hoot about whether my agreements are binding because I am not going to court over a lawn account. What I am concerned with is the fact that people will pay good money for what they want and a service agreement is my written promise to provide it. That written promise commands top dollar.

    I have a couple of judges and several lawyers who are my customers, except for them and a couple other exceptions, I know more about contract law than my customers. The agreement is a customer service tool, it documents and provides assurances. All deals made have the potential for being broken due to unforeseen causes so an agreement must spell out the terms of cancellation. It is not about a "legal and binding contract" those are words that are used in movies, but not court rooms.
  6. GreenI.A.

    GreenI.A. LawnSite Silver Member
    Messages: 2,131

    I'll clarify what I ment by binding. Here in MA any contracts for service on residential accounts can be terminated by either party at any time. If the customer decides mid season to cancel services, they can do so, of course they have to pay any outstanding balance for service done, as well as the lco has to credit back any money they may have paid above service completed (prepayments). Where as with installs we can have a binding contract that once signed the customer can not terminate once past a set deadline. For example I had a customer who signed an install contract but then dragged his feet on sending us the deposit check. We went back and forth for months and I found out he had someone else do the install after signing my contract. We went to court over it and he had to pay we the full contracted amount. That's what I meant by the service agreement being non-binding because those can be terminated at any time, and are more or less an agreement that the company will do x,y&z for $$$
  7. uniquechev

    uniquechev LawnSite Member
    Messages: 119

    That is a great point !!! I always ask them why is it that they are looking for a price if they are unhappy with who they have no or if they are just shopping around cause I really dont want to do business with people like that cause you could be gone too . I like to kow what they like and dont like aobut the service they have had or what they would like to see etc. I dont offer the 10% until they are ready to sign because like you said they'll want more % off other things. I tell them right off the top that this is a first time customer promotion. Anyone else think it's a good or bad thing ???
  8. cpllawncare

    cpllawncare LawnSite Silver Member
    Messages: 2,659

    I have to agree You have to listen and pick up on exactly what the customer is looking for and give them that! You just can't sell on price anymore, it has to be quality! I just refuse to go the high volume low cost way!
  9. Chilehead

    Chilehead LawnSite Bronze Member
    Male, from Stockbridge, GA
    Messages: 1,969

    I must join the club here....this is good advice. I learned really quick when I started my own biz 10 years ago to NEVER refer to a contract as a "contract". It's always an "agreement".
  10. GreenI.A.

    GreenI.A. LawnSite Silver Member
    Messages: 2,131

    I will offer a discount for prepay for yearly service for fert, I justify it to the customer because it will save me billing time and billing charges throughout the year. Also if they prepay for a fall service in the spring like aration, seeding, irrigation winterizing, I will give a discount, justified because I can schedule the routes tighter by having them confirmed ahead of time. Flea and tick treatments, I'll give customers a discount because we can do the ap when on the propery to do the fert/chem aps. Basically when I offer a discount I justify why they qualify.

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