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Michigan LCO's

Discussion in 'Network: Central' started by tiedeman, Sep 4, 2003.

  1. Outdoors_Unlimited

    Outdoors_Unlimited LawnSite Senior Member
    Messages: 449

    I've got a question for you guys.

    His do you guys go about determining what the market will bear pricewise.

    If I go with the formula of figuring out my costs, and going with that, I'm leaving money of the table because I operate with as small of a budget as possible.

    I "think" I'm starting to get the lawn pricing figured out, as I am hitting the hourly rates I'm shooting for. I'm looking more along the lines of the irrigation work. Last week I installed a lake pump for a friend, thought I made decent money doing it, only to have the neighbor tell me he couldn't even buy the pump for what my installed price was. When I talked to the guy at the irrigation supply I found out I under sold myself by $200. I dont want that to happen much more. So this week, on a valve replacement I thought I would try to up the price I was charging a bit, to have the customer tell me I was way high. I've always charged $125 to replace a valve, and tried $175 this time.

    We are always getting compliments on how nice of a job we do, so I know I'm pretty much covered on the quality side of business, now to figure out how to be more consistent and in line on the pricing department. How did you guys learn this part. I once heard, Johnny's plumbing company didn't fail because he was a bad plumber, its because he didn't understand business. Basically that's what I'm afraid of. I KNOW the work/field/crew management aspect of being a business owner, but I never knew/ still learning the business side of it.

    Would it be best for me to take some business classes? What tips can you offer?

    Edit: I'll add that I am still small, with one helper, but want to learn these things before I grow much more, and run into issues, risk loosing everything I work so hard for.
    Posted via Mobile Device
  2. 3rdDayBrad

    3rdDayBrad LawnSite Member
    from MI
    Messages: 133

    You have some great questions, Outdoors...

    A business class or two is never a bad idea. They will give you direction when you're making those important decisions for your company.

    As for what you charge....

    As long as you are covering your costs and making a respectful profit, then you are doing it right. You will not get every potential customer you talk to.

    But you will get the customers who believe you are being fair, have heard of you beforehand and know your work. These customers will be willing to pay what you are charging.

    I do not do any advertising... haven't for 10 years. All my work is referrals. I have some good customers who have given my number out quite a few times. I also have formed some great relationships with other business owners who work in our field.... sprinkler installers, tree companies, suppliers, etc. They also have given me some great referrals thru the years.

    Keep doing what you are doing. Do good work, and always give the customer a little extra when you are there, they will see that.

    Seems like you are on the right track. Good luck!
  3. Outdoors_Unlimited

    Outdoors_Unlimited LawnSite Senior Member
    Messages: 449

    I spent this winter studying plant id/care. I'm thinking it would be a good idea to enroll in a few classes for business next winter and try to dial that end of the business in.

    Thanks for the response Brad.
    Posted via Mobile Device
  4. reliablelawn

    reliablelawn LawnSite Member
    Messages: 138

    Coming from a finance major at MSU, business classes will only get you so far. If you are looking for a "business class or two" you will be forced to take a basic Marco/micro econ or a basic corporate accounting class most likely. These courses have little to no practice application to real world small business owners. Good basic knowledge to know? Yes. Game changer for running a business? I could not count on it.
  5. 3rdDayBrad

    3rdDayBrad LawnSite Member
    from MI
    Messages: 133

    All due respect, Reliable, but taking some select business courses CAN be a game changer for running a business. Enrolling at a local community college gives you the option of choosing which classes you take. Micro/Macro economics is not one of them.... Business Mgt, Sales, or even Marketing are all good areas to gain some knowledge for running your business.

    With knowledge comes power. And in this case, the power to make educated decisions that can only help you grow your business.
  6. 3rdDayBrad

    3rdDayBrad LawnSite Member
    from MI
    Messages: 133

    You are one step further than most of your competition, Outdoors. Having a Horticulture degree myself, I am constantly entertained by the many 'professionals' in our field that spew nothing but B.S. to customers just to get the job. To me, that doesn't reflect professionalism at all, but rather, ignorance and immaturity.

    Keep doing what you're doing, Outdoors. As I said in my previous post, Knowledge is power. :weightlifter:
  7. puffyhead929

    puffyhead929 LawnSite Member
    Messages: 203

    Agreed. I'm doing the same thing right now. Those classes help to an extent but nothing replaces real experience.
  8. MJK

    MJK LawnSite Senior Member
    Messages: 356

    Hey guys, I'm looking to buy a diesel transfer tank system to put in my truck. I want to keep the fuel as clean as possible while brining it to the jobsite to put in skid steers. I was looking for a 50 gallon size. Any recommendations by those who have them?
  9. Lightningllc

    Lightningllc LawnSite Senior Member
    Messages: 330

    I took a semester of business/ finance and there is no comparison to real world first hand experience. You will learn how to mange money and create a profit and lose charts, you will be shown how a real world application is setup in a perfect world. Let me tell you this course is if you sit behind a desk at Goldman sacs or fidelity I would recommend it. But in our cut throat business first hand experience is king, Neil the best thing to do is sit down and figure out what you have into every job ( material, time, overhead) then tack on a 10% fee just for a mess up. Now you should see where your at. The big companies run at a 15% profit and smaller companies run at a 40% profit.

    I have figured out my profit and lose it really makes a difference when you bid a job and when planning on the future of your business.
    Posted via Mobile Device
  10. Lightningllc

    Lightningllc LawnSite Senior Member
    Messages: 330

    Put a inline filter on it. Put a lock on it too.
    Posted via Mobile Device

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