lowballing thoughts

Discussion in 'Lawn Mowing' started by martinfan06, Nov 10, 2006.

  1. martinfan06

    martinfan06 LawnSite Senior Member
    Messages: 631

    Since been on lawn site the term lowballer gets thrown around quite a bite. My thought is this,Im married 3 kids just like most, but my house is paid for vehicles are paid for in short just dont have as many bills as most people.So if Im able to charge less for the same service as say a LCO with $20000 house 40000$ truck 30000$ in eqipment that dont really need, dose that make me wrong? Now dont get me wrong here im not talking 1/2 off or anything like that just 20% less on average. Theres guys in this area that run around with murry lawn mowers cuttin 1 acer @ 15$ now that chapps my @^* as much as the next guy. I think what im getting at is people dont think about overhead as much as they need to, I can do the same quality with less overhead charge less but in the end make just as much as the next guy. Any thoughts?
  2. 6ofus

    6ofus LawnSite Member
    from Ohio
    Messages: 19

    You are Right, Over head is a big expense for a lot of people, but that is were you can make money buy charging the same amount and you can make more profit. The key is selling the service, you pay for what you get, I do believe most people are in business to make money. why take less. I want to be known as a great business that does great work, then a cheap company, that is OK. in order to get top dollar you need to look top dollar, and have a personality.
  3. wowmowwow

    wowmowwow LawnSite Member
    Messages: 209

    i cant help but grin at the guys on the murrys. it doesnt bother me when i drive passed them to my "acre" jobs and then drive by them again leaving to do another job close by. thanks
  4. martinfan06

    martinfan06 LawnSite Senior Member
    Messages: 631

    True see your point, but a business trying to get a quality client base can gain more clients weed out the crappy ones a little faster therefor grow more productivly. Instead of having to take any and everything and put up with anything just to make ends meet. So for now I charge a little less get maybe 2 times the amount of clients, throw back the ones dont want and the cycle continues.
  5. 6ofus

    6ofus LawnSite Member
    from Ohio
    Messages: 19

    I know what you mean, there is a company that I compete with, Last year we both did some advertising and I went on around 10 estimates and so did he I got 3 account's off of those 10. This year I got a phone call from him and he asked if I would be interested in some of his lawns in the area I looked at them and just so happen the 7 I didn't get he had just offered them to me the reason why is he could not make any money he was 5 to 7 dollars less than my bid and with the gas price gone up he was in trouble, but I have them now for what I bid-ed them on last year. So if you can do it for less take that into consideration.
  6. WildWest

    WildWest LawnSite Senior Member
    Messages: 384

    I have 5 kids....so I hear ya!
    You are right.... you can charge less and still make the same amount of profit as someone who charges more. This whole scenario is not the point of pricing/lowballing.

    I'm two months behind on my truck payment, electric bill, water bill, phone bill, cable bill, 3 credit cards. 1 credit card i'm amost 3 months behind.

    If the temptation to lowball has nver been greater for me. I just can't do it.
    I try to make my prices VERY competitive, but i'm not gonna go MORE in the hole (if that's possible at this point) to make a buck.
    I bid a mowing job 2 weeks ago, the lady had about 3/4 of an acre with fences EVERYWHERE, sidewalks and bagging to boot. I said 80.00 a month (every other a week) and she said "well, that's kinda high" ...I about crapped myself!!! $40.00 a mow... and thats A LITTLE HIGH???!!! I said, well that's the best I can do ma'am. Hell, I'm having a time buying DIAPERS, AND THIS OLD FART THINKS I'm A LITTLE HIGH! I think SHE might have been HIGH!

    Am I ready to lowball.... yeah. And I don't bame anyone that does to get their foot in the door, but it's no way to run a business!
  7. martinfan06

    martinfan06 LawnSite Senior Member
    Messages: 631

    Yeah its crazy what people call high Im tempted to say "whens the last time you bought gas, heres the recipt for what I HAD to buy this morning"

    Guess what iI was getting at with the lowballing term is when a guy post what he charges for a job and WE jump on him about lowballing(im guilty) maybe we should consider hey how much did you clear off that job. Granteed he has licsense and ins. Basiclly its just up to how your set-up, but yes eventually my prices will be at or above industry standards and ill have the 40000 truck and the 200000 house just hopfully if gose as planned ill have a good client base to support that.
  8. daveintoledo

    daveintoledo LawnSite Silver Member
    Messages: 2,587

    i dont think haveing lower over head and charging a little less is lowballing.....

    but i got 90 (which is low for some areas) for a 3.5 acre job, and now the guy is paying 35 dollars,

    be careful you dont price yourself out of businesss or into the poor house.....

    competition is healthy, stupidity in giving estimates and priceing is not....:)
  9. ACutAbovesiny

    ACutAbovesiny LawnSite Senior Member
    Messages: 590

    If you are paying your bills, labor, equipment, yourself for your time, and still making around 8% -12% profit than that's not lowballing....thats efficiency.
  10. Az Gardener

    Az Gardener LawnSite Gold Member
    Messages: 3,899

    I am running into something a little different. My rates are in the 40 per hour range mind you I don't have big equipment a 36' walk behind that is old and rarely used is my biggest mower. Mostly 25"-27" reels and they are less than 2-K new.

    Any way I know my competitors, we are friendly and talk prices and from time to time.Sometimes I win they loose or vice versa. Most are more expensive than me on the hourly rate 50 and up, but they don't know how to bid. So my hourly rate is lower but I budget (realistically) more hours so the bottom line is my bid is more.

    I just picked up a client that dumped me in the spring because I raised her rate she came back (everyone leaves in the summer) and half her plants were gone. I told her I could have lowered my bid too if she let me kill that many plants. Now she is back and paying my rates.

    On the other hand I just lost a T & M account when he got an 850 $ bid from one of my regular competitors. Thats less than 4 hours per visit and we were spending 5-6 lately and closer to 8-10 in the summer. I told him I would see him in June if not sooner and we both laughed. He said maybe so we will see. I know they can't keep him and the wife happy with 4 M/H per visit. That is just enough time to mow & blow. No light or irrigation check, and forget about fertilizing dead heading flowers or trimming plants.

    So thats my Low balling issues I don't even get concerned with the idiots. bidding 23-25 per man hour. Just "professional " companies that don't know how to bid.

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