Why price lawns at set rates?

Discussion in 'Lawn Mowing' started by escient, Apr 30, 2008.

  1. escient

    escient LawnSite Member
    Messages: 105

    I've been reading a lot of threads about pricing lawns, and I'm curious as to why anyone would have a "set price" for up to XXX square feet, with variances for obstacles, etc.

    To me, this is just taking money right out of your own pocket.

    What is to be gained by charging "flat rates?"

    I could be missing something, but if I've got 2 potantial customers, both with identical .25 acre lawns in 2 different neighborhoods, but one is a 150K house and the other a 300K house - guess which one gets the higher rate?

    Sure, there are exceptions to every rule, and you can't always judge a book by its cover (or in this case a customer by his house), but you can pay attention during conversation and price based on that.

    I have about 10 customers I priced before ever even seeing their property. Why? I asked questions.

    Have you ever had lawn service before?
    Who did/does your lawn now?
    What did you not like about them?

    People LOVE to talk - and if you engage your customers, you can find out a lot about them and why exactly they're looking for service from you. And remember, they DID call YOU. They need you, not vice versa.

    If their last guy didn't come regularly like he said he would (and this is the case most of the time in my experience) - I get to charge more than them because I will be more reliable.

    I know my competition so I know what they charge. Every LCO around has estimated my lawn. They've also estimated my friends' lawns.

    I know the area. If I know you're in a 300K house with strict covenants, I know what your lawn SHOULD look like and what YOU should pay for me to maintain it.

    Many of you probably do this already, but if not - look into it. When you get an address to a residential customer, look up the property card through the county property appraiser's office. It's public information and most bigger counties (and many smaller counties) have it available on the web. If not, it can be obtained by walking into the courthouse.

    On most property cards, it tells exact acreage and all details about the house, INCLUDING what the customer paid for the house.

    If this sounds sketchy to you, then keep in mind that there's a reason the one guy lives in the 300K house and the other lives in the 150K house. Some people are more financially driven.

    I've got several customers who overpay me by twice the amount I should charge. But I give them THE best service so I know that if they do switch, they'll be calling me again once the "cheaper guy" isn't up to snuff.

    I've also got a few that are a little underpriced. But underpricing isn't bad either, so long as you're still making money. Everyone here has gotten extra jobs simply by being parked in front of a house.

    In the end, what I'm getting at is this:

    Get what you can out of who you can. The guy who sold you your mowers and your trucks sized you up when they first met you, too. You paid the absolute most they thought they could get out of you, and from experience, many of you know you've overpaid on some of your equipment. So if they can do it to you, why can't you do it as well?

    Hey, it's your wallet. I'd just rather charge you what I think my time is worth to YOU - not what my time is worth on a "per acre" basis.

    HOOLIE LawnSite Gold Member
    Messages: 3,981

    I always 'profile' my potential customers...however the thing you're missing is, a lot of people in the 150k houses have much more disposable income than those in the 300k houses. I have quite a few customers in an older development, a lot of original owners, who paid like 40k for the house, and I have carte blance to do whatever, whenever, and send a bill.
  3. escient

    escient LawnSite Member
    Messages: 105

    Absolutely. Again, the property card is a perfect way to tell when and how much they paid for their house.

    But if you're running a $1900 mortgage payment, I can generally assume your disposable income isn't a big issue.

    Besides, for the most part, this is a "disposable income" generated business.
  4. metro1handyman

    metro1handyman LawnSite Member
    Messages: 27

    I understand what you are saying about don't have set prices. I also am in the remodeling business and those prices are never set in stone. However with mowing for me specifically I have to have a set price schedule(w/ add ins for extra services, lanscaping, etc..) Because my money eventually comes from banks, real estate agents, and the government. (there are no homeowners @ my properties,,foreclosures.)

    But I would agree that if you are not in that business you wouldn't want to have set prices .. you would just leave too much money in the attic.
  5. Carolina Cuts

    Carolina Cuts LawnSite Bronze Member
    Messages: 1,152

    Yea, I think McDonalds does that too.... I went through the drivethrough window with my truck and got a cheeseburger for a $1.00.
    Went back later that day with my sisters BMW and they charged me $3.00 for the same burger.

    sooo, if both .25 acre properties take the same amount of time for you to do, then why charge the $300k house more money ?
  6. topsites

    topsites LawnSite Fanatic
    Messages: 21,653

    If it's the same amount of work then it should cost the same.

    As for engaging in talk I'm still only but so hip on that, time is money too heh...
    I don't mind it, but to a point.
  7. Az Gardener

    Az Gardener LawnSite Gold Member
    Messages: 3,899

    Escient I'm curious how this bidding process is working out for you? Do you mind sharing your yearly gross, or % of growth from one year to the next, or your retention rate.

    I ask because you obviously feel it is working well for your but numbers don't lie. The other thing is perception is a funny thing I am just trying to understand your business so I can see if it is similar to mine. Before I would consider implementing anything as important as a change in my bidding process I need some more information.
  8. dishboy

    dishboy LawnSite Fanatic
    from zone 6
    Messages: 6,042

    I set and list prices on door hangers because it saves time on bidding. If they call you you still probably need to meet with them but it a sure sale. No one's time is wasted . Being efficient and competitively priced encourages customer clustering at stops,drop your gate , two to seven lawns at one stop. Haven't you seen car dealers with the lowest /only price policy , some are doing quite well with this policy.
  9. escient

    escient LawnSite Member
    Messages: 105

    What a crappy McDonald's for doing that to your sister!

    You can look at it however you choose, but quite simply, McDonald's is selling a product, not a service.

    You, on the other hand, are selling a service.

    It's the exact same thing as different regiona pay different money for mowing. So do different neighborhoods. Everyone knows this.

    Because I can. I am the service provider and I set my rates. It's the same as Fedex charging a bigger fuel charge to deliver your packages further.

    With that reasoning, why not charge both customers $5 less per week than you normally would? You wouldn't because you'd be stealing from yourself.

    Everyone has a different idea and perception on what lawn care should cost. What one guy thinks is worth $30 another might think it's worth $45. Chances are, the guy with the nicer house thinks your time is worth more, and if he doesn't think that way, it's up to you to sell it to him that it is in fact worth more.

    Others are required to have nicer lawns. If the 2 lawns are in different neighborhoods and one doesn't give a crap about his lawn's appearance, go ahead and mow it for whatever. If the other guy HAS to keep up with his lawn to satisfy the neighborhood's requirements, why wouldn't you charge him more knowing you have to please both him AND the neighborhood?
  10. escient

    escient LawnSite Member
    Messages: 105

    PM me and I'll share whatever you'd like to know....

    I just wanted to open a discussion on this - cuz I don't understand why some LCO's are pricing this way - especially when gas is so high and many of you don't want to charge fuel surcharges.. The extra money has to come from somewhere, so why jack up 30, 40, 50 customers KNOWING you'll likely lose a couple.

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