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The king of all low-ballers Wal-Mart. But successful!
Walmart is successful, mostly because they get everything from China. Retail is a very different business than services.

Here we are living within the same area. We pay around the same for gas, insurance, equipment, labor, and taxes. This is assuming we are all legit. To be competitive we must balance quality with efficiency. That or cheat.
 
Just because someone is the lowest price does not make them a low baller. But if they price well below the average price (like 20%plus less) then yes, they are low ballers. Believe me I have my overhead down as far as possible. I don't think their are many companies in my class, in my area, that run as lean as I do.

I still cannot compete against the LC that hires illegals, pays no workers comp, no overtime, and deals cash, not to pay taxes. It's either that or a newbe comes in, not knowing any better and under prices, just to get work.
The worst are in the commercial market. Every year you hear the same thing "man I wish I could land some big commercial accounts, those guys have expensive trucks/equipment."

So that company underbids the current contractor because the contract is worth $25k. They never sit down and figure out it costs them $25k to maintain the contract :hammerhead:

$18,000 is less salary than we pay the guy on the trimmer. If you want ALL of the headaches that go along with owning a business for $8.50 an hour my hats off to you :drinkup:
 
There is such a thing as business ethics.

When guys are dropping prices just to generate gross sales, then it goes against business ethics.

Personally, we're to the point that I could care less about the guys (big or small) driving down prices. Why? Because at some point there will be some sort of cost increases such as fuel or equipment that will hurt these companies to a point where they can't profit anything at all, and when they go to raise prices on their clients, they'll loose accounts left and right.

At that point I'll sit back and watch the carnage, cover our butts and wait till the market re-establish itself.

It's a race to the bottom and it's fun to watch.



...........
 
Wal-Mart's prices are cheap simply because they have cheaper products. They compete with quality stores such as Macy's with misleading adds that don't mention the true quality of the product. Kitchen aide mixers for example. WalMart is 100.00 cheaper on the same "appearing" mixer but if you read the fine print you will find it is half the power as the one sold at Macy's. This scenario is the same in the lawn business. It may look like a good deal but it's really a half powered knock-off. The fact is WalMart and lowballers make a killing from people who can't afford or don't care for a quality A product.
And yeah I recently bought a mixer for my wife.
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I haven't read every reply, but my definition of a "lowballer" is someone who prices their services so low that their profit margin is extremely low, or non-existant. This usually happens because of ignorance or desparation, more often the former. In a capitalistic society, one can choose to charge as little, or as much, as they choose, but often those with little business acumen jump into mowing considering only one expense, the fuel they burn in their equipment. They don't think about equipment replacement, the true cost of operating a tow vehicle, or the perils of operating without liability insurance. They likely work on a cash basis, showing no income, hence are not worried about self-employment taxes or income tax. In all likelihood, their business plan is not long term, but simply a way to seemingly make a few extra bucks for the time being. An example would be a fellow I know who uses his dad's non-commercial Z to mow in one of the communities I service. His approach to the business was to watch other LCO's and see where they were mowing, then approach the property owner and offer to mow for one half of whatever they are currently paying. That, in my opinion, is lowballing, not someone who has little overhead, chooses to live simply, doesn't care about having a new truck, is perhaps single, and bids a $40 yard for $35.
 
I haven't read every reply, but my definition of a "lowballer" is someone who prices their services so low that their profit margin is extremely low, or non-existant. This usually happens because of ignorance or desparation, more often the former. In a capitalistic society, one can choose to charge as little, or as much, as they choose, but often those with little business acumen jump into mowing considering only one expense, the fuel they burn in their equipment. They don't think about equipment replacement, the true cost of operating a tow vehicle, or the perils of operating without liability insurance. They likely work on a cash basis, showing no income, hence are not worried about self-employment taxes or income tax. In all likelihood, their business plan is not long term, but simply a way to seemingly make a few extra bucks for the time being. An example would be a fellow I know who uses his dad's non-commercial Z to mow in one of the communities I service. His approach to the business was to watch other LCO's and see where they were mowing, then approach the property owner and offer to mow for one half of whatever they are currently paying. That, in my opinion, is lowballing, not someone who has little overhead, chooses to live simply, doesn't care about having a new truck, is perhaps single, and bids a $40 yard for $35.
This should be in Webster's
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Some out there with less "overhead" than us guys trying to do it the right way sometimes means no insurance, licenses, and other shortcuts. It will catch up with them at some point.
You're right and if someone out there is trying to cut for half price is probably offering work of about half price quality. There is always a lot of turnover when this happens and the jobs will come back to the "non-lowballers"

YardBros Outdoors
www.yardbros.com
 
In my experience, bids for a well defined scope of work will generally be plus or minus 20%, so within a 40% range. There is a reason for this...there is a certain cost of doing business and there is a certain amount of time and resources that must go into doing a job. In order to bring the price below a certain level something has to be compromised.

Let's take a lawn that on average would go for $50, based on my 20%. That would mean one contractor might bid it at $40 and another at $60. That's a normal range. It wouldn't be fair for the $60 guy to be calling the $40 guy a lowballer. However, if someone were to bid it at $25 or $30, that would be lowballing in my opinion, and logic tells me that they're going to have to cut corners somewhere in order to provide the service at that price, and that their long-term ability to continute to provide the service at that price is questionable. It's not uncommon for some companies to deliberately lowball jobs just to get them and then once they have the job to exceed their price, citing all sorts of reasons that they claim could not be forseen...not something that's easily done for mowing services though...the scope of lawn mowing is pretty easy to define.
 
Only a lowballer would say they dont exist. You posted thread about averaging $25 a lawn in two threads. Then wonder why you cant afford to hire someone? I dont drop my gate for less then $35 and when I do it takes 5 mins with a 21".
 
The thing is...some guys are perfectly happy to net $500 for a week of work.

They will work their a$$ off to mow 60 lawns a week, pay a helper, pay for gas, machinery, insurance, etc. Then when all is said and done, they are making $15 per hour and are happy. It is a big step up from working for someone else for $8.

What they fail to comprehend, is that they could do the same work and make double or triple by simply charging more money. But to some guys, that is an unrealistic goal. They have a $15/hr mindset. They say stuff like "I don't want a fancy truck payment", or "I paid cash for everything", or "My overhead is low", or whatever other foolish excuse they want. Bottom line, they don't think they are worth the money the other guys charge.

Personally, I would rather cut 20 lawns for $50 than 50 lawns for $20. Some guys disagree. To each his own.
 
Just b/c you have 'almost no overhead' doesn't mean you should discount your services.
I couldn't disagree anymore. I'm no fan of charging X amount or Y amount just because I can.

if I set up a business and wanna earn a certain % profit I'm gonna use my numbers to get that profit. if my numbers (expenses/overhead) happen to be lower allowing me to get my % with a lower price I'm gonna do that.

if I can earn my % charging $30 when the other guy has to charge $45, I'm not gonna charge $45 just because others are and can.

my min for example is $25 a lawn. I'm solo with very little over head. my buddy has his min up to $30-$35. he has 6 employees. he probably needs his min up that much to make a profit on a yard he charges the min. I can make the same profit with $25 that he makes charging $35. could I get $35. I'm sure I could since a lot of guys with employees are getting that but I'm making the kind of profit I want and need to make. which is why I'm in business.
 
Lowballer to me isn't about their pricing, its that they usually don't have the insurance, licensing, and sometimes even the equipment necessary to do the job. Hack is a better term for these types. I have em in the town where I do business. Heck an unlicensed dude sprays the townhome complex right next to my house, and waves to me at the same time. Ignorance is bliss or so they think.....
 
I couldn't disagree anymore. I'm no fan of charging X amount or Y amount just because I can.

if I set up a business and wanna earn a certain % profit I'm gonna use my numbers to get that profit. if my numbers (expenses/overhead) happen to be lower allowing me to get my % with a lower price I'm gonna do that.

if I can earn my % charging $30 when the other guy has to charge $45, I'm not gonna charge $45 just because others are and can.

my min for example is $25 a lawn. I'm solo with very little over head. my buddy has his min up to $30-$35. he has 6 employees. he probably needs his min up that much to make a profit on a yard he charges the min. I can make the same profit with $25 that he makes charging $35. could I get $35. I'm sure I could since a lot of guys with employees are getting that but I'm making the kind of profit I want and need to make. which is why I'm in business.
6 employees and charging $35 a lawn?

You charge $25 a lawn?

Good luck to you and your buddy! I would go out of business if I charged that little!
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Wal-Mart's prices are cheap simply because they have cheaper products. They compete with quality stores such as Macy's with misleading adds that don't mention the true quality of the product. Kitchen aide mixers for example. WalMart is 100.00 cheaper on the same "appearing" mixer but if you read the fine print you will find it is half the power as the one sold at Macy's. This scenario is the same in the lawn business. It may look like a good deal but it's really a half powered knock-off. The fact is WalMart and lowballers make a killing from people who can't afford or don't care for a quality A product.
And yeah I recently bought a mixer for my wife.
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Big difference quality wise on a 200 dollar mixer and 50 dollar mixer from Wal Mart.

Cutting grass is different. 40 bucks for my yard is a fair price to cut for my 10k yard. If I hire someone that cuts it for 20 bucks, there isn't going to a quality difference versus the LCO that would cut if for 40 bucks.

I think this is why so many guys get frustrated with lowballers because the end result is the same.
 
Lowballer to me isn't about their pricing, its that they usually don't have the insurance, licensing, and sometimes even the equipment necessary to do the job. Hack is a better term for these types. I have em in the town where I do business. Heck an unlicensed dude sprays the townhome complex right next to my house, and waves to me at the same time. Ignorance is bliss or so they think.....
I'm with you DA......when I think lowball I think scrub and when I think scrub it's not necessarily about prices. could be no insurance, no license or using home owner grade equipment.

6 employees and charging $35 a lawn?

You charge $25 a lawn?

Good luck to you and your buddy! I would go out of business if I charged that little!
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well your a great example when I say the market varies from location to location. me and my friend are both from IN and we both run very successful businesses.

I've been at it now for 7 years and my buddy has been doing it for 13 years.

those are the min prices though. doesn't mean every lawn I have is $25. for it to be $25, I'm probably in and out in 30 min or less and most likely using a 21 incher or 36" walkbehind.

my average lawn is $32.
 
Big difference quality wise on a 200 dollar mixer and 50 dollar mixer from Wal Mart.

Cutting grass is different. 40 bucks for my yard is a fair price to cut for my 10k yard. If I hire someone that cuts it for 20 bucks, there isn't going to a quality difference versus the LCO that would cut if for 40 bucks.

I think this is why so many guys get frustrated with lowballers because the end result is the same.
I don't agree. Mowing is a service, not a commodity and there usually is a difference between what a lowballer provides and what a true professional does. Denpendability, cutting at the proper height, quality of the cut, trim, edging and cleanup can all vary greatly. I'm sure we've all seen guys cutting a lawn too short, scalping edges with the trimmer, leaving a lawn looking like Clumpville, blasting houses and filling beds with clippings and leaving the hard surfaces a mess.

There are some people who just want the grass cut and don't care about that stuff, but there are others who are picky about the appearance of their lawns and the lowballers will not be able to satisfy them regardless of their price. Those are the types of customers I seek out...they're willing to pay for quality and dependability. Yeah, I have some crappy lawns for customers with low expectations, and honestly it's sometimes a relief to work on them, but I get much more personal satisfaction manicuring a nice property and looking over my shoulder as I drive off and saying to myself "damn that looks nice."
 
I did not read all posts as well, seemed most was saying the same thing over and over. Definately not looking to center anyone out, but you know who you are. My question i have about this subject is if this the term "lowballer" comes to someone who doesnt understand costs or business so to speak. What is the term for the company out there overcharging or ripping people off so to speak for doing the work at much higher prices than can be justified, and trying to secure customers with false accusations that only a company of your magnitude or proffessionalism can provide? The work i do, i love to do and take pride in. I can beat most prices as well as quality, and still be profitable while choosing not to be big (proffessional)and in debt.....now im not bashing any certain type as i do upgrade and grow from time to time. I however just choose to keep the business side simple and the work i do extravagant. I just do not look at my business as being in cometition with others in landscaping, only with myself and what i succeed in......so yes, i set my prices with my profit in mind, only with foremost consideration and fairness to my customer im doing the work for
 
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