quoting and estimates

Discussion in 'Business Operations' started by jaymo3141, Apr 19, 2013.

  1. Darryl G

    Darryl G Inactive
    Messages: 9,500

    When I first started out I would mentally compare a new lawn I was quoting to one I already knew how long it would take. After a while, especially after quoting some too low by accident, you will get good at just being able to walk a lawn over and come up with a price. Be sure to allow extra time for slopes, lush lawns, obstacles and those with lots of detail work. I have a lawn that's under 5,000 sq feet that takes longer than lawns 5 times that size due to all of the tight spots and detail. And don't forget to discuss frequency of mowing with the customer!!!!!!!!
  2. exmarkking

    exmarkking LawnSite Bronze Member
    Messages: 1,012

    time is everything. Small properties can be deceiving. Some take longer than a big open property. Ill tell you what helped me out so much starting out. I started timing everything. When I pulled up to a property I would write down the start time. When I finished, write down the stop time. Get into a routine of doing this for every service you perform. Now after about 2 months, you'll have some data to work with and I think you'll be shocked at the amount if time it takes and how much you were charging for some properties. I found out that the properties I thought were easy and quick, were as profitable as I once thought. The way I figured it out was for example: if I spent 35 minutes each week on a property that's a total of 140 mins. lets say I charged the customer 30 dollars a visit. That's 120 dollars a month. Now take 120 dollars and divide it by how much time you spent on that property. That tells you how much you got paid for each minute you were there. Now compare that to your operating cost per hour. If you have to, divide your operating cost by 60 to get the figure down to the minute. This will tell you if you were profitable or not on that property. Also this isn't considering the travel time so that can really throw your profit off if you are driving really far to get there. I hope this makes sense
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  3. Patriot Services

    Patriot Services LawnSite Fanatic
    Messages: 14,505

    This number is completely aribitrary and takes into account nothing. I've heard it quoted as long as there have been internet landscape web forums. I could easily eat up a dollar an hour in expenses. New fully optioned truck, new enclosed trailer packed with top of the line gear and 3-4 typical employees with a foreman. Still think there's gobs of money there at a buck a minute?
    Not trying to be a dick. Just rying to dispel a number of myths that seem to surface every year with the latest crop of new guys.
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  4. exmarkking

    exmarkking LawnSite Bronze Member
    Messages: 1,012

    Very true. That's why I laugh when I see someone asking for help quoting a job. Anyone that responds has no clue of the askers operating cost. That's the first thing you figure out when going into business. I mean, how can you know what to charge if you don't know what it cost to perform the job? Every business is different. Like the guy above said, the guy with the crappy junk in the back of a mini van verse a company with employees, insurance, taxes, new trucks, equipment will be way different. Also the how good the employee is makes a difference. I have some guys that barley get out of the truck by the time the other guy is halfway done edging and weed eating already. When I started out I tuned myself on each property and kind of got a base line for how long it takes the average person in the landscape industry. I didn't run and I didn't walk. I was efficient. There are so many trucks to speed up your time on a property. Anything can change your times for better or worse. I bigger mower will speed up your time to a point. Weed eating beds and edging with it will speed up times verse going and getting an edger off the truck. Once you get your properties in tip top shape, you can fly thru them every week because there isn't much to do since they are perfect. Your just maintaining them. There are so many variables that go into time. As you grow, get better equipment, employees ect. Your times will speed up but so will your cost of doing business. So you have to always adjust.
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  5. bmxerss

    bmxerss LawnSite Member
    Messages: 125

    I charge 65 dollars weekly to cut one clients yard, and 125 to trim hedges at the same yard. usually around 40-50 anywhere else.
  6. nozzy

    nozzy LawnSite Member
    Messages: 67

    The $1 per minute is definitely just a starting point and you must figure out what your expenses are in order to properly price your work. BUT, if you are just starting out it is very hard to determine what that number is until you have been in business for a while. There are so many variables that it is impossible to just sit down before you have ever mowed a lawn, crunch some numbers, and know with any level of accuracy what your operating costs are going to be. Usually when guys start out they take on all kinds of work which makes it even harder to know what your operating costs are. As you do this for a while you start to realize that some jobs are impossible to make anything on. After a while you start to recognize those jobs/clients BEFORE agreeing to do the work so you can avoid wasting your time on stuff that isn't profitable.

    Anyone asking for help with estimating isn't the type of guy with lots of employees and hefty notes on all new, top of the line equipment. If you are just starting out, working by yourself or just with a helper, you will do okay if you can average a dollar a minute at each job. After a full season you can more accurately figure out what your true operating costs are and adjust that rate accordingly. As someone else said, precisely time all of your work. It will make it very easy to see which accounts are the most lucrative and which ones aren't so great. As you get more work you will be able to continue tightening your routes which can drastically increase profits. At least for me, my minimum charge is $25 for a mow and blow. About half of my accounts don't take me 25 minutes to complete so that helps offset the accounts where I'm not quite hitting that $1 per minute. There are several add-on services that you can upsell that you can make way more than a dollar a minute. These services are much easier to sell to your regular mowing customers so even if you aren't making a huge profit on your dollar a minute customers there is still potentially a lot of value in maintaining that lawn. The customers to avoid are the ones that call up looking for every other week service. They'll tell you, "it just doesn't grow in the summer so it doesn't need to be mowed every week." They are looking to spend the minimum on their property so they are unlikely to buy other services from you, and even if you are doing a good job, their lawn is always going to look like crap. I used to take accounts like that and I can't remember any of them that turned out to be a good for my business. They screw up your weekly schedule and they never result in new customers. The guy across the street sees your truck out there, notices the lawn looks like crap, and assumes you suck. Not a great recipe for picking up new accounts on that street. Come up with a standard system for quoting prices for a standard package of services. Get good at providing those services before you start adding new ones. If and when you do start adding new services, count on losing some money on them at first while you figure out how to estimate your time and determine what people in your area are willing to pay for such a service.

    Keep your expenses as low as possible for your first few years, develop a niche and stick to it, don't be afraid to say, "I'm sorry we currently don't provide that service," and make damn certain you are setting aside money for taxes. That check to uncle Sam right as the next new season is just getting started will kill you if you haven't been planning for it all along.

    Lastly, with regard to pricing work by the hour - that might work for 1 guy in a hundred. For the other 99, that is NOT a good idea. Customers are going to feel like they need to be watching you to make sure you are working the whole time you are at their property. If you need to stop to gas up a mower is that now on their dime or would you pause the clock for the customer - at least if you see them looking out the window? When you are giving the quote, potential customers are going to think your prices are crazy high. (customer: "SIXTY DOLLARS AN HOUR TO CUT MY YARD???!!! ARE YOU FLIPPIN' CRAZY???" insert expletives...repeat) Also that must complicate your daily work completion tracking and billing system immensely. I honestly can't think of one single advantage to pricing lawn care like that. That seems a lot more like the customer is the boss and you are just an employee. I personally wouldn't like that arrangement from either side of the deal. Maybe I missed something in that post...who knows.
  7. CreativeLawncareSolutions

    CreativeLawncareSolutions LawnSite Silver Member
    Messages: 2,017

    I think it goes without saying that some common sense needs to be applied. If you're running around in a 50k truck with a couple 10k mowers and 2 more employees than you really need then yeah you're going to go broke.

    $1 a minute. Tested to be 100% accurate for years and years and years. It's the standard. The problem lies in when people say they get that $1 a minute but actually aren't getting anywhere close to that. You can't just say it. You actually have to do it.
  8. 32vld

    32vld LawnSite Gold Member
    Messages: 3,983

    A dollar a minute is an ok starting point. Though you price the job by you never sell the customer by the hour. You sell by the price of the job.

    Customers will fight paying $60 an hour to pick weeds, or anything else.

    I begin all estimates by measuring. SF for lawncare and cleanups. Hedge prunning, bed edging based on length.

    Just looking leaves room for mistakes.


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