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Painful lesson

Discussion in 'Lawn Mowing' started by cutntrim, Mar 8, 2000.

  1. cutntrim

    cutntrim LawnSite Senior Member
    Messages: 474

    Thanks for the responses and support. My response to this property manager via e-mail asked him to phone me on my cell today so that we could discuss the contract. He did not do that, instead he sent an e-mail in which he told us he went with another contractor for a savings of 6%. He praised our quality of work and the ease of dealing with us and said he can &quot;only hope the new contractor will be as good to deal with&quot;. In response to my inquiry about retaining at least the properties in our immediate geographic area, he said he considered splitting the properties between two companies but the &quot;savings would be minimal&quot;. He further said he did not &quot;believe&quot; in giving contractors an opportunity to price match because it would affect the quality of their work. <p>We have worked for this company for the better part of 7 years and evidently he does not feel this continuity, nor the quality of our service, is worth 6%. Furthermore, he admits that dividing the contract between us and the lowballer guy would realize a dollar savings. Yet, he says it would be minimal. How then do you describe a savings of 6%? Maximal?!? <p>Yes we do owe it to ourselves to fight this all that we can, and I will address him with regards to his contradictory e-mail tomorrow, but the fact remains the same...I am powerless to stop him from awarding the contract to a lowballer, friend or other-wise. I can swallow my principles and match price (increasing equipment productivity to offset lowering our costs) but not if he won't give me the chance.<p><p>----------<br>Dave in S.Ontario<br>
  2. HOMER

    HOMER LawnSite Gold Member
    Messages: 3,183

    Diversify, thats the name of the game. I hate to hear that you were beat out by a mere 6% but all these brown nosers want to do is impress their superiors, look what I did boss, saved us $100.00 over the next 5 years, can I have a raise!! It's total B.S. but thats the way they work! <p>I called my property manager today, let her know that the contract had expired on my one and only apt. complex. She wasn't even aware that it had expired but when I asked if they were going to re-bid it, the first thing she asked was &quot;is your price going to be the same?&quot; Never did she say&quot; we were impressed with the quality of your work, the shrubs looked great all year, the curbs were in great shape. All she wanted to know was if I was going up on my price. HELL YA I'M GOING UP ON MY PRICE!!!!!!!!!!!! There are only about 340 shrubs at this place! I took a bath last year, but I won't this year. If I &quot;brown bag it&quot; then they'll have something to say. It ain't no different than working for &quot;the man&quot;, they never see the good in what you do, only the problems get you attention.<p>I don't have a good answer to the problem, I wish I did. Having 58 residentials though would ensure that you would have some regular work, chances of all 58 calling and telling you bye bye are slim to none unless your face gets plastered on the front page.<p>Homer
  3. Charles

    Charles Moderator Staff Member
    Messages: 8,822

    Dave it' s not your job to as you say &quot; swallow my principles etc&quot;. The contractor that took your job will find out soon enough that a business cannot be sustained without a decent profit margin. You have already learned that. You don't sound like you are being greedy. Go bid on something else as soon as you can. There are many companies out there that appreciate quality of work at a decent price. We all lose and gain business all the time due to one reason or another. Just because a man owns a business or manages one means that he know what it take to run your business. This man is obviously ignorant to what it takes to run a quality dependable lawn service business. So his contractors and employees will come and go. And soon he will go:)
  4. SLSNursery

    SLSNursery LawnSite Senior Member
    Messages: 442

    Don't waste another minute on it. If you try to hard to get the job, you might be sending the wrong signal. I have a couple of stories:<p>1. Last year in Nov. a property manager called us to bid a snow job. I told her the price verbally, and she almost fell down. We do other work for her, but I was not interested in this job, and couldn't do it cost effectively, so I was honest with her. A friend of mine ended up with the job for the same price I bid. Now, on a referral for snow at a place I can service, she mentioned to my referral that we 'jumped ship' at the eleventh hour on the aforementioned job. We did no such thing. Point, is, there is no loyalty, and I'm glad I didn't lower the price or work to hard to please her. I still have the jobs with her that I perform well at, and because the customers are happy with the end results, the price isn't an issue.<p>2. I have bid a condo for several years. They are paying about 20k for maintenance services, that I have bid 33k for. I took the lawn care (chemical) contract last year from a big commercial company because this place wanted service. They renewed my chemical contract, and were happy with the reports and advice I provided them. They are now considering my bid for the landscaping. It is still high, and if on the chance I get the contract, it will be because I didn't change my standards, and my consistency will speak for itself. My point here is that the only problem with sticking to your guns is that someone might say your prices are high. Big deal, think of how that manager will feel when the cheaper bid company tries to bill for extras, or doesn't do the job. When someone complains, he will be put to trial for being pennywise and pound foolish. Direct your efforts at marketing towards and attracting new customers who fit in your niche. Learn from the lesson and move forward, don't wallow in it.<p>----------<br>Phil Grande - Soundview Landscape Supply - http://members.aol.com/slsnursery<br>Ivy League Landscaping - http://members.aol.com/scagrider
  5. Dave what might be a low ball price to one contractor might be 25% gross profit margin<br>to another contractor.<p>How big are your mowers? My set up for wide<br>areas is a 52&quot; & 62&quot; walk behinds with stand<br>up sulkies on a 5.5 x 12 open trailer. I can run both those machines for about $5/hour in<br>mower. fuel, and maint. costs.<p>So if you see a set up like that in your service area you would be advised to quit<br>the lawn care biz and become a priest.
  6. cutntrim

    cutntrim LawnSite Senior Member
    Messages: 474

    Lawrence,<p>Your levity is as always amusing. We run a 52&quot; Toro Z and a 54&quot; WB riding on a 6'x14' open trailer for the larger properties.<p><p>----------<br>Dave in S.Ontario<br>
  7. John Deere

    John Deere LawnSite Member
    Messages: 128

    Lawrence Stone: Maybe I'm just not smart enough (although I doubt it) but are you saying you can make money at $5.00 an hour per mower? Please, I'm not trying to be a smart ass or anything. I jst want to know if that's what you mean and if not then explain it to me. It reads to me that you are saying you are making money at $5.00 a mower per hour. Sorry if that's not the case.
  8. Eric ELM

    Eric ELM Husband, Father, Friend, Angel
    Messages: 4,830

    John Deere, What Larry said was: I can run both those machines for about $5/hour in<br>mower. fuel, and maint. costs. <p>I read this as his expenses on his equipment per hour.<p>----------<br>&lt;a href=&quot;http://www.townserver.com/elm/&quot;&gt;Eric@ELM&lt;/a&gt;<br>
  9. Lazer

    Lazer LawnSite Bronze Member
    Messages: 1,446

    Bear in mind while he's maintaining and repairing those old machines constantly, (I've owned over 20 Toro's, I know.)<p>While he's doing that, he's competition is still mowing for $30.00/machine/hour.<p>His cost on paper may only be $5.00/hour, but the opportunity cost is much higher.<br>
  10. Charles

    Charles Moderator Staff Member
    Messages: 8,822

    Larry, How you come up with that 5.00$ figure? Those mowers could break down at anytime. The truck you pull the equipment could break down. Tommorrow you may have to replace or repair any equipment you have. Older, cheaper equipment on average need repairing and replaceing sooner than newer equipment.

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