Reader's Forum

Price Wars
An excerpt from the Lawn & Landscape Online Message Board. Join the discussion at www.lawnandlandscape.com/forum.

QUESTION:
“I’m bidding on more commercial and association work. I presented my bid to the person in charge and they immediately told me my price was surprisingly high. My price was almost three times the other company’s price just for the mowing. These guys took 13 man-hours to do this job. Their price is $225 per cut – $17.30 per man-hour, not including travel. I understand the more man-hours you have, the more you can spread your overhead and the cheaper the price can get, but you still have to pay these guys a wage. In this case, you’d barely be paying above minimum wage to make any profit. I’ve heard the big companies are around $15 to $20 per hour. What am I missing here? How can it be done?” – Todd Patton, president of Patton Property Maintenance in Heymarket, Va.

ANSWER:
“No matter what you are selling, there are people who will be shopping the lowest price and people who are shopping quality. There is a third gray area in the middle that I personally recommend you stay away from because you wind up having to promise the world at rock bottom prices. If you are selling a quality product, you MUST show the client how you are different than the guy who charges half as much and why paying you more is a benefit to them. If you know your numbers and how to estimate properly, you will make money. The minute you start lowering yourself to your competitor’s standards, you lose.” – Gregory Slatner

ANSWER:
“I think there is money in maintenance. But to find the money you first need to know, understand and watch your numbers. You need systems in place. You need structure. I know of a lot of guys who are doing very well from mowing grass. Again, biggest thing is it’s all about the numbers. And you have to run it like a business. You can’t run it with the mentality that you need to cover your truck payments or you’ll never make it.” – Andrew Aksar, president of Outdoor Finishes in Walkersville, Md.