Here's another example of what I'm getting at

Discussion in 'Lawn Mowing' started by Envy Lawn Service, Oct 14, 2006.

  1. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,865

    No I disagree. You get what you pay for. And whether you are a big corporation or a small business or just an individual consumer, the same thing applies. They aren't going to get near the level of service, prompt attention, or quality with that other cheapo outfit as they have been getting with Envy. So it's not like they are getting the exact same thing for a cheaper price. They're getting a much cheaper, less-reliable, slower-to-respond, and less-loyal service for half the price. It's comparing apples to oranges.

    So yah, if price is the only thing that matters to them, and quality and performance doesn't, then I guess it's a wise move. But otherwise, I think it's just a case of them learning the hard way all over again. That's a lesson everyone (including myself) always seem to learn over and over again. YOU GET WHAT YOU PAY FOR. I can't tell you the number of times I thought I found a better deal on a service or product and fell for the temptation of a cheaper price only to wish later I had purchased the product or service where I used to purchase it from. In other words, I found out quickly why it was such a good deal. I think this company is going to have to learn that lesson all over again. Then maybe they'll think twice next time they want to cheap out on someone.
  2. Envy Lawn Service

    Envy Lawn Service LawnSite Fanatic
    Messages: 11,067

    OK Jim,

    How are you related to this person or how do you know them?

    Others should take note and be reminded about being straight up about things because it really is a "small world" especially these days. You never know who's family and friends you may be doing business with.

    Jim, if you don't know this person I'm gonna get "the willies" before Halloween gets here this year. Because that would be plain wierd. What you wrote is pretty close to a direct quote of much of the conversation. About as good as anyone could quote another person after the fact. Not all of the conversation, but much of it.

    I did my best to speak my mind frankly and did my best to do it in a manner that would not seem like I was trying to kill the messenger. I understand the position of the 'lay-person' and how they get caught in the middle.

    I tell you, the one thing that still blows my mind about management structures in this day and age.... I just do not get how top tier managment will give lower level management the responsibility and clearance to make certain decisions... and have a board meeting with other upper tier manangers and make a colaborative decision to turn right around and override the decisions of their lower level managers.

    It just makes no sense at all if you really think about it. It's internally counter productive. I'd never do that unless I had to, and I can tell you now that if I did override someone's decision like that, that person would be getting chewed a new one or be getting fired over a really poor decision.
  3. Envy Lawn Service

    Envy Lawn Service LawnSite Fanatic
    Messages: 11,067

    Oh... and to beat all I forgot to add...

    This conversation happened on Tuesday, and sure enough inspection day, Wednesday, there I am just sitting down to some lunch and sure enough my phone rings. I answer and it turns out some of the upper tier folks are there for all the on-goings... and due to some stupid stuff on their part it's another special request. They wanna know if I can go to another location in another town to do something to cover their arses. What amounts to a job that would take the rest of the day when all was said and done.

    My answer was....

    "I appreciate the offer and I wish I could help. But right now I'm a full day behind in meeting other obligations due to the all day rain we recieved yesterday. I really hate to have to turn something down this soon, right out of the gate after yesterday's meeting. I assure you it's not deliberate. As I explained yesterday, as a business owner I'm always having to adjust my priorities, and at a time like this my main priority focus has to be meeting my existing obligations and doing everything I can do to get back on schedule.

    Unfortunatley, this is a perfect example of a time when my business scheduling has to be adjusted to a priority driven mode in order to protect my own best interests. If you can give me a little more lead time next time around, maybe I'll be able to handle the next one that comes along. But not short notice like this.

    You may want to advise them to turn to their other contractor to see if he can arrange cover this one for them, and if it would be easier for you I would be glad to explain this to them if you want to put one of them on the phone with me."
  4. Sandgropher

    Sandgropher LawnSite Senior Member
    Messages: 903

    Good to see you are not at their beck and call any longer :)

    You have handled the whole matter quite well and hopefully these people will be reminded you get what you pay for.:)
  5. craigs lawncare

    craigs lawncare LawnSite Senior Member
    Messages: 307

    I hate to tell you, but people who make spending decisions for business look at landscapers as expendable. What really matters to them is the bottom line and the share holders. Management gets paid to make business decisions that turn a profit. If costs have to be cut, where do you think they are going to look? Do you think they are going to fire their accountants? Their IT personnel? Their engineers? The first place they are going to look is expendable areas. Lawn work/site maintenance will be one of them. In the past, they may have been willing to pay a bit of a premium for quality service. Now, the way things are in this country, they just want it done. The catch is, they want it done as cheaply as possible. If you were maintaining their mainframe, or doing their accounting or something along those lines, they might be more willing to make cuts elsewhere. But the fact is, lawn mowing companies are a dime a dozen. I am not trying to slam anyone out there. After all, I mow and landscape on the side as well. I have done it long enough to know that it is a skill. A trade that not everyone is cut out to do.
    But I also work for a big corporation for my 40hr per week job. So I know from experience that the first and foremost factor in business is how does it affect the bottom line. The company I work for is large. More than likely larger than the one Envy is doing business with. Our company seeks the cheapest bid for contract work like lawn service. Every time. It is as simple as that. The company I work for is undergoing major cuts right now to trim costs. Why? It is determined to show a .05 profit for 2007. They are making sweeping cuts across the board. Not just contractors.
    So if you think they are going to fire some of their own labor force, many of which they may have incurred heavy training costs but not look to trim back on lawn work. Well, then you just don’t understand big business.
    Like I said earlier. I think the guy Envy is communicating with is nothing more than a go between. I think they are feeling Envy out. I think they are seeing how cheap they can get him to drop his prices.
    Like I said earlier. If I were Envy, I would not budge on my prices.

  6. Envy Lawn Service

    Envy Lawn Service LawnSite Fanatic
    Messages: 11,067


    Unfortunately to an extent you are right in a lot of cases. I see this more and more all the time.... customers who go to the lowest bidder every time. This is a growing trend for sure. But that doesn't make it right, nor is it always the most cost effective way to do things.

    So as I said before, usually there are only two things that will change this once they start into this trend.

    1) Can't find anyone to do the work anymore

    2) They learn that cutting costs short-term often results in increased costs long-term

    Honestly, I still do believe both of the above factors is why I finally ended up with what work I have. The thing is that for everything they have me do, they are paying what they should have been paying all along, and in many cases they are also paying increased costs to get things back in shape from years of taking the lowest bidder.... and when the budget is set based on the old ways, the expense hurts and the budget is a bust.

    I tell people all the time that it the long run it is cheaper to maintain a property properly than it is to repair it from neglect.

    As for my pricing... no I have not budged, and I made it very clear in the beginning that I would not budge. Yes, often these sort of games are played to try to "punk" a contractor on pricing. But they already know this will not work with me. For them I will not compete with another contractor, nor is there any need to ask me if I will match someone elses pricing.

    My level of service costs what it costs.
    I can't come out matching their prices for my level of service.
  7. Precision

    Precision LawnSite Silver Member
    Messages: 2,995

    And that is when you start to have fun doing the work.

    I turn down lots of business that wants cheap. Why bother running around like a fool to profit 2 nickels. Fewer jobs but at a profitable rate is what makes this business worth doing. The whole cheap, fast and good thing. you can have any 2 but you can't have all three.
    a huge fleet of crews running around doing tons of volume and making it up that way.
  8. Envy Lawn Service

    Envy Lawn Service LawnSite Fanatic
    Messages: 11,067

    This has been my whole philosphy since the get-go.

    I mean I'm not going to lie... I haven't been so busy I had to turn all new business away in a few years now... as the market has deteriorated.

    I've accepted that's just how it is and I have maintained my price scale. I totally agree that doing fewer jobs at a higher rate of profit is what makes this worth doing. As long as I hold my prices, I will probably continue to be in the same state... but at least I will not find myself out there kicking myself for busting my hump out there on some dirty job sweaty all over and being unhappy with what I'm earning.
  9. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,865

    Envy, Haha. No, they aren't my relatives. That's just how I would have handled it. So I guess great minds think alike. :)

    As for your post above (#46), you are right. The reason that you have the business you do and can charge what you charge is because there are SOME people and companies who have already learned the lessons of hiring cheap contractors who don't perform.

    The truth is that Craig and I are both right. He's right that a lot of companies do just look at the bottom line and go with the cheapo contractors. But you and I are right that after a while, some of them eventually learn their lesson and stop going for the cheapos. I know this for a fact because there are a handfull of really nice upper end businesses around here (Nike headquarters, one of Intel's main branches, several other nice commercial sites and upper end appartments or townhomes) who have hired some of the more expensive commercial LCOs in our area to handle their grounds maintenance. Before I bought my first home in 2000 my wife and I lived at one of the nicest luxury appartments in the area. They knew I was an LCO and I once inquired about their current service, just in passing. I was just curious about the rates they were charging. I wasn't wanting to give a bid. And the manager of the complex replied to me, "We pay HK&T $xxx,xxx per year. And we didn't hire them because they were the cheapest either. We hired them because they're the best."

    So I know for a fact that there are plenty of businesses, both big and small, who DO think of quality and performance over price. It may be only 10% of them. But if I were in the commercial market, it's that 10% that I'd be going after.
  10. Envy Lawn Service

    Envy Lawn Service LawnSite Fanatic
    Messages: 11,067


    I guess you are right then... It's still like 'wow' to me though... LOL.

    As for the customers, there are all types out there. But in general, I don't have any customers that do business with me based on price. ZERO. But that does also include frequent numbers of customers that are willing to pay my rates for some other reason outside of what I wished they were. AND that ratio has been on the rise for a long while. AND while some of these turn out to be great, some also do not.

    Naturally, I love the ones that hired me for the right reasons.

    Anyways, to further update, this seems to be going along quite smoothly now. My rates have remained the same for the other extra work. My quality level also remains the same.

    The only thing that has changed is that I have cut their priority level quite considerably. Both on the existing contract agreement and the additional services billed extra. I make no extra effort to go out of my way for either, and any additional services requested also take priority over the rest.

    In addition, I also do not go out of my way to group 'say 2 small jobs' together when scheduling to save them any money either. When a service request comes in, I schedule it as it comes in at my convience and I get to it then. Even if it's going to be charged at a higher rate ratio or hit the minimum and I have another small one come in before I get to the other. I will schedule it in the same manner also... just which ever way is going to be the most profitable for me.

    This week for example, the other outfit was there finishing up that renovation. Yup, it took them that long (they went in the hole BAD!) and there was something that needed taking care of ASAP. So naturally, they got the call first because I made it clear that an "urgent or emergency service charge" would NOW apply to these requests.

    The other outfit said no and they had to call me. I went and took care of it after dinner and they got an emergency "fee" from me for a few minutes work because it was such short notice.

    Overall, with all things considered, I still really miss the renovation money, but I'm not so sure I'm not actually happier with the new arrangements. Things are sure a lot less hectic....

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