Scared Yet? I lost 90 customers to scrubs.

Discussion in 'Lawn Mowing' started by Jason Pallas, May 14, 2003.

  1. Jason Pallas

    Jason Pallas LawnSite Bronze Member
    Messages: 1,335

    Yep - that's right. As of today, we've lost 90 customers to scrub lowballers this year. Our business is down about 15% and we're tightening belts even further. We've already cut back on employees and are cutting costs at every opportunity. This is the worst I've ever seen this business in the 20+ years I've been in it.
    Just a heads up to the rest of y'all. We're here in Detroit/Metro and the slumping economy has hit us particularly hard = every idiot with a pickup truck and a craftsman mower has decided to hang out a shingle and go into business - deep discounting labor so much so that the market is flooded with "companies" so heavily that I'm seeing prices under what I charged 20 years ago!!
    Forget that angle about being insured and paying taxes and liscenced etc.... the only thing people in this market see is the botom line. "If I can get it cheaper........ that's all that matters!" These lowballers have screwed the market up here so bad that it will take years to recover. I've never seen a market fall apart so quickly. It's absolutely depressing and scary as hell.
    I can only hope that what's happening here in Detroit doesn't spread to the rest of the country or pretty soon we'll all be washing windows at intersections - because it pays more than running a landscaping company!

    Just a quick aside - We were underbid ( and I was really low-bidding to get the account!) by a bunch of school-teachers that run a lawn service in the summer. When I pointed out to the lady that these guys probably weren't insured, didn't contribute to the economy by paying taxes on their "side" income and wouldn't be around to handle "full service" needs (such as Fall/Spring clean-ups, any installations, mulch deliveries etc...) - she just said "Yeah but they're cheaper!!! Ha ha ha. " (we bid $23 they bid $20). Needless to say they got the job.
    I can only wonder how they'd feel if I went to the local high-school and offered to teach their classes for half price, cash . no benefits, no vacation pay, etc..... They'd probably be really pissed that their livelihood was being screwed with by scab labor that was willing to under-cut them in order to make a quick. - Yeah feelin' your pain!!!!
  2. nelbuts

    nelbuts LawnSite Bronze Member
    from SW, FL
    Messages: 1,053

    I can understand how you feel and good luck to you. Think about this the county I live at in FL has almost 700 lic. lawn maintenance companies. not county all the scrubs. Big county you say... nope 145,000 total residents. And we have companies from other counties come in and do work!
  3. Jason Pallas

    Jason Pallas LawnSite Bronze Member
    Messages: 1,335

    Yeah - thanks - I thought I remembered a couple of threads a year or two ago about a similar problem in FL. I can only hope it gets better here and there. I remember reading the threads and thanking god that our market at the time wasn't bad - if I only knew what were to come.
  4. Mark P

    Mark P LawnSite Senior Member
    Messages: 352

    :angel: Jason i hate to hear that, thank God youve got 85% still in accounts, I know what your mean about everyone with the pickups out of work is now a LCO. Ive seen more this yr than ever, This is my 14yr is the Business and to me its just a part of it. I haven't lost any accounts, infact ive turned several down, alot has to do with the relationship with your clients..Has any of yours been commercial? I do alot of commercial and have been doing alot of them now for 10 plus yrs, i know ive been underbid but ive become like one of the Companies employes, i charge a fair price, do the best work i can, and always thank the good Lord..Hope you pickup that 15% good luck....Marks Mowing Service
  5. drobson

    drobson LawnSite Member
    Messages: 237

    The same thing is happening in every industry. Just look at retail stores. All the stores have been selling their products at such low prices to get customers that they can't lower them for the usual big sale times Like Memorial Day or 4th of July.

    Look at the car dealers, they have been running 0% financing for so long now that there is nothing to bring in the customers for their big sales either.

    The competition for the few customers that will spend money is very hard. Of course this industry is easier to notice because we have fewer customers and they are usually repeating customers. But everyone is in the same boat, and hopefully it will get better soon.
  6. Mueller Landscape Inc

    Mueller Landscape Inc LawnSite Senior Member
    Messages: 489

    Have you considered going into an area and low balling all the low ballers? If you had 20 plus customers all on the same block, your crew could have minimal travel time. With your experienced workers, you should be able to run circles around a bunch of school teachers. Make them sweat!!!
  7. madmow

    madmow LawnSite Member
    Messages: 44

    It does suck when there are lowballers stealing business. This is my first official year as my own entity. I worked for a guy for about four years and decided to start a business to get myself through college. I decided immediately upon starting that I wasn't going to lowball anyone. It just isn't worth it to lowball someone and do a 40 dollar job for 25 bucks. I am insured, liscenced, I own commercial equipment, and I have bills to pay. So, to hell with lowballers, they won't be able to make it with a piece of **** push-mower and bills to pay. They'll fall apart, and you'll still be around. Just keep up your quality work and eventually the idiot customers who went with "the guy who was cheaper" will come crawling back to you.
  8. Green Pastures

    Green Pastures LawnSite Silver Member
    Messages: 2,457

    Dude that stinks.

    Well, thank God you've got enough customers that you can lose 90 and still be in business.

    If I lost 90 custimers I'd have a negative customer equity.
  9. Green in Idaho

    Green in Idaho LawnSite Senior Member
    from Idaho
    Messages: 833

    You're admitting you offered a 'low-bid' and yet you are concerned about low-bidders?

  10. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Messages: 8,745

    what I would do if I was you is found out how and why you lost them and then send your customers a nice letter letting them know that you would take them back any day, but include in the letter a checklist that your ex-customer should going over with the shrubs.

    1. Are they insured?
    2. Are they licensed?
    3. What associations or certifications do they belong with or have?
    4. How many years have they been in business?

    I can guarantee that the shrubs would not be able to answer at least 2, maybe 3 of them.

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