West Chester, Ohio: “I have been running numbers. I found that I am a complete idiot. My average yard takes about 45 to 55 minutes solo. I charge an average of $25, but have some $65 to $85. I do not think that I am charging enough. I would like to get $30 to $35 for the yards that I currently charge $25. They warrant the $30 to $35, but the customer shied away. I would like to at least get $30. How can I raise the price and present this to the customers? Maybe raise it $3 for next year? I made $355 last week with cutting 14 lawns. That is roughly $25 average. I’d like to make more to hire a helper with me so I can knock out more yards. Next year I plan on attaining 60 to 70 accounts. I currently have 29. Could use some help on budgeting
Manchester, Conn.: “Gotta have the $35 minimum.”
Grand Haven, Mich.: “My minimum charge is $25 and those lawns all take me less than 25 minutes to do solo, typically between 15 and 20 minutes. If I were going to be somewhere for 50 minutes, I would want around $50. The best way to increase price is not in the middle of the season. You will want to raise your prices at the beginning of the season.
“What you really need to figure out is how much it costs to run your equipment per hour. That will let you figure out how much you need to charge per hour to make money and still cover all of your expenses.”
College Station, Texas: “It sounds like you have some biweekly’s—you need to start pricing those at a higher rate. For instance, if you charge $30 for a weekly mow, biweekly needs to be $40. I would wait until spring to
Virginia: “Thirty-five dollar minimum charge! This is for lawns that would take less than 30 minutes to complete. If longer, you could figure $1 per minute, and that’s ‘ramp down to ramp up’ time!
“Depending on your area, you may have to adjust this number slightly.
“You should also figure in travel time to get there, i.e., if it’s 10 minutes away from your last stop, figure in an additional $5 to $8.
“There are several lawn care calculators out there. You measure the property perimeter, how many obstacles (trees, swing set, etc.) and the calculators give you (based on what you told it what your per hour rate was) a price to quote. If you don’t know what your hourly rate is (based on all of your costs), you need to go back to the basics of business! You need to know this before you quote anything, otherwise you are guessing, and probably going broke doing it!
“I’m going to guess that your main competition (I’m talking companies that have been around for more than five years, and not the lowballers in your area) might be charging $45 to $65 for the same property, probably know what their costs are, and are making a good profit, and have nicer equipment and will probably be around next year!
“By the way, your numbers are way off! You say that you averaged $25 a lawn, but you had some properties that you charged $65 to $85? The question that I would have is, ‘How long, in minutes, did those accounts take you?’ And, after expenses, what did you actually put in the bank? And, don’t forget about depreciation, gas, insurance (I hope that you do have insurance, don’t you? Truck, medical, workers’ comp., etc.), trimmer string, etc. At this point, I’m guessing that McDonald’s would have probably paid you more than what you may have taken home after all expenses. Do yourself a big favor: figure out exactly what you need to charge for your time to be profitable! If you loose half of your $25 or less properties, so be it, because you will work less hard and make more on the other properties that you end up with. Then, as you get new clients, charge the correct rate for their property, and grow your business that way!”
Missouri: “I had a commercial cutter tell me that he does his bids at $1 a minute. I thought he was stupid, and then I sat down and figured up some totals, and it’s really not too far out of line.”
Virginia: “In Virginia, some are now charging $1.10 to $1.15 per minute for the quote. Several years ago, $1 per minute was about average.
“Haven’t your costs gone up in the last two to four years? Your pricing needs to keep up, right?”
Spring, Texas: “I do not understand a minimum charge. You guys would never get any work here in houston. Our average residential is $30 a week, and that is for mowing, edging, trimming, hedge trimming as needed and raking and weeding flower beds weekly. You have to know your costs to make money in this business. I do many yards for $25 also.
“If I were you, I would not raise your rates. You are destined to lose customers if you do that. I have been doing some yards for three years, and I have not raised the rate once. You can’t. Just treat them right, and they will treat you right by giving you mulch and landscape work.”
Southern Pines, N.C.: “I think I agree with this poster. It is harder and more expensive to get new clients. If you are way off, then go ahead and raise it up. I usually wait until the next season after I have built up a relationship, but if I come in a little low on a property, it is with the belief that that customer is willing and able to give me their extra work(fertilizer/pesticides/mulch/tree work/aeration/plantings/etc.). If I came in low and misread the situation, then I politely give them 30 days notice and tell them I can’t do their service anymore due to a big new job. It is like buying a car—they sell you a car cheap to get you back for the service. There is good money in the extras, and I will come
Swift Creek, N.C.: “You’ll probably have to raise them slowly, especially at this point—in time with a lot of people losing hours at work and their jobs. I work solo, did 15 jobs this week (yawn) and made $600, plus one tiny little shrub job that paid $110. Not a bad week for a semi-retired guy, eh?”
West Chester, Ohio: “Thanks guys for all the advice. I know I do not have the nicest equipment, but I think a 23 hp 52-inch Grandstand and a 52-inch Toro Proline (2001 with 15 hp Kohler) is not bad. Others have nicer, yes, but mine does the trick and will continue for the long haul. I am committed to doing this for a long time. Hopefully, my goal after next year will be to run a second crew. I am going to go to college for business (accounting CPA). I’d like to make my company where I can have someone run it for me and have another job that handles the rest of the expenses. I have a new truck that I plan on running until the damn thing falls apart! I just wish I could put more in the bank. Almost all of my $25 people let me do their landscaping (mulch, plants, etc.), which is great. I also work for two banks that give me a decent amount of work. Next year, I hope to be cutting most of the day care centers in my area.”
Pennsylvania: “I’m in the same boat as you. I have a few lawns that are low (prices) and I need to get them higher. I’m waiting until next season and sending out a note that there is a price increase by $3 due to the cost of running a business (operating costs), and if they don’t like it, fine, I don’t want them. If a customer complains about the price, I don’t want them.”
Turnersville, N.J.: “Is your $25 per lawn profit, or do you still have to pay for gas, insurance, truck payment, mower payment, lunch, maintanance, health insurance, motor oil, etc.? If it’s $25 per lawn profit, it’s not much, but its acceptable. If your making $25 per lawn and still have to pay all your bills, then there is a serious problem.”
West Chester, Ohio: “Yes, I have 29 accounts, but picked up three through a bank, so 32 now. I work for two banks, so I get accounts here and there. I have one account at $50, which is way underpriced I think: 1.5 acres, but about 50 trees to weed it and a fence as long as the property. I think $65 to $75 next year is a minimum, or they can find somebody else. Yes, I have around 10 accounts at $25. Two of them I am OK at $25, but the other eight want me next year, but it’s gonna put me out of business because
Iowa: “Take a real good look at all your costs. Do a search here to find hidden costs that are real, but you may not have thought of. Then, do a search here on pricing and read every thread.
“If you don’t want to do all that work, $1 per minute is a decent rule of thumb for solos with low overhead and accounts reasonably close together.”
Richmond, Va: “Economically speaking, it is a little bit too soon, I think, to start raising prices aggressively. The key word here is aggressively, meaning you can ask, but I dare say at least for the time being it is the customer’s choice. You might want to concentrate on increasing your customer base.”
Benson, Utah: “Talking costs can be so arbitrary. There are guys on here that are happy if they make $20,000 a year after expenses. There are guys living at home. There are guys whose wives do the real breadwinning. There are guys who do this as a second job.
“It all depends on what you want to achieve. I can tell you this much, though, the $1 a minute rule will never, not ever, get you well off. You can survive on that (maybe), but you can’t thrive on it. Not with the cost of equipment, fuel, etc., in addition to the reality that you have no retirement package (401K), no health insurance, no life insurance, etc.
“All that being said, charging your existing clients more for mowing is like raising the price for a haircut. The receiving end is simply gonna look at you and say, ‘Well, you’re just doing the same thing as you were before, right?’ You can price creep a couple bucks a year, but the thing I found is that you need to find new/better clients and let the starter clients (that helped you get on your way) fall by the wayside. That’s just the reality of it. There’s nothing sophisticated about mowing, and you can’t perform some magic that others aren’t able to do cheaper. Thus, unless you’re one heck of a salesman, you’re not worth the extra dough. That’s the mowing biz.
“Get out there and find those more lucrative accounts, and put the crap accounts in order as to which ones you will cut out of your schedule first.”
“In Your Own Words” is contributed from the lawn care and landscape forum at www.lawnsite.com. Visit them, and join in the discussions.