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Make customers prepay?

Discussion in 'Lawn Mowing' started by DFLS, Dec 29, 2007.

  1. DFLS

    DFLS LawnSite Senior Member
    Messages: 354

    How many have contracts where the customer prepays monthly, quarterly or yearly? I am thinking of doing this only for the ones who consistently get a month or 6 months behind in payments. I do not have any contracts now and 35 out of 54 customers pay promptly consistently. And those who don't pay on time - do you add finance charges?
  2. TNT Lawncare

    TNT Lawncare LawnSite Senior Member
    Messages: 263

    I don't for see anyone wanting to prepay. If you try and make them, they will simply go with someone else. Yeah, it sucks when they take forever to pay but it is what it is. The lawnboy is simply not that important to most people.
  3. jpp

    jpp LawnSite Silver Member
    Messages: 2,131

    I have about 10 customers that take advantage of a prepay program that i have. I give them a discount of a percentage if the pay in adavance for 25 cuts. When the 25 cuts are used up I start billing them monthly. It works out well. 'that way I have some start up cash at the beginning of each season too.
  4. landscaper22

    landscaper22 LawnSite Senior Member
    Messages: 829

    Many LCOs on lawnsite have success with pre-pay customers. I don't think it will go over in my area. I wonder if this too varies by region. I don't know of any LCOs in my area that require customers to prepay. If it works, it is a great idea. Another option which I am considering is take credit cards and require customers to pay with credit card. Then they don't have to prepay, but you can run their card numbers every week or month and you don't have to worry about late payments. This has been mentioned on lawnsite before. I have not done this, but I have been thinking about it. The only problem with that is it too will cost money to accept cards. I really think that is crazy.
    But other than that, I just have to put up with the late payers until I get to the point where I have no choice but to drop them.
  5. 2 clowns mowing

    2 clowns mowing LawnSite Senior Member
    Messages: 566

    yes,yes,yes all my mowing customers are pre-pay and i don't have any problems with them. extra work like tree work, hedge trimming, landscape work is billed right after job is done. and don't have any problems with payment. if customers don't pay by the end of the first week they don't get mowed and they seem to pay soon after when we don't show up.
  6. Exact Rototilling

    Exact Rototilling LawnSite Fanatic
    Messages: 5,378

    Are these all weekly clients? Have you ever had anyone want to switch to bi-weekly mowing to slow down having to pay again?

    I like the idea. It appeals to people such as myself who look for every excuse to pay ahead to reduce the bill.
  7. TNT Lawncare

    TNT Lawncare LawnSite Senior Member
    Messages: 263

    I know in my area, there are probably only a small percentage of people who could afford to plop down $500-$1000 for a years worth of mowing all at once. I know I couldn't do it. I agree, some areas of the country will be different.
  8. jpp

    jpp LawnSite Silver Member
    Messages: 2,131

    Yes all weekly customers. One client that I do I just make the call on when to cut it though. The yard has a boat load of trees and really slows down in the summer time. I usually just do him bi weekly. But he has a boat load of ash trees that will be coming out due to the emarld ash bug back here. So that will increase growing on his yard.

    I actually had to start billing some again for the October cuts this year. Some of these have installed sprinkler systems so I might bump them up to 30 prepay cuts.
  9. shane mapes

    shane mapes LawnSite Senior Member
    Messages: 537

    it sounds good but i don't see it working around here .. to much competition and i will not pay a head for services so i don't expect my customers to do this either ...
  10. topsites

    topsites LawnSite Fanatic
    Messages: 21,653

    In my case it all depends on how likely I think I am to get paid, and since my collections system uses credit reporting it boils down to the folks whom I think will give a rat if this is affected.

    So, if I even think I might not get paid, if I'm in doubt, if I don't know, prepay it is.

    Other notes: I recently found out that with Fico scores and risk, once you get over 740 the risk factor is so slight it doesn't even chart, but below that the percent of good to bad is almost equal, regardless of actual score.
    That I found amazing, but I did notice a change in real life somewhere above 720.

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