Lawn Care Business Pricing - Rates and Bidding Advice

So you have just started your lawn care business and are wondering how you are going to bid on your first job. Or maybe you have bid on a few accounts already and lost them due to being way off with your rates.

Offering a price to prospective clients for servicing their lawns on a regular basis is not easy. Newcomers to the business are always looking for a formula or method to help them to quote accurately but are quickly disappointed when they don't find one. While there are lawn pricing tips and guidelines that you can follow you will have to rely on instinct to some extent. The good news though is that with a little experience you can become proficient at estimating and bidding on lawns within a fairly short time period.

In the following article we offer some tips and guidelines for pricing a lawn and then we set out two pricing methods that are commonly used in the industry.

Pricing Tips and Guidelines

Don't make the mistake of pricing too low if you are just starting out in business. Many entrepreneurs come into the industry with the idea that they will establish themselves by competing on price. Bidding too low will mean that you will struggle to reach a profitable level of operation with your business. When you do finally realize that you have to increase your prices considerably to make any money you will risk losing most of your clients. Customers that choose a service based on price alone are often not the most loyal and they won't think twice about moving on to the next low priced operator. Those business owners that do under price, known as 'low ballers' in parts of the US may also be doing a great deal of damage to their local lawn care industry and will be resented by their competitors.

The only time that you may want to price low is if you are really having trouble getting started in the business. If you offer your first one or two clients a great deal then you can at least get going and build up some confidence and experience.

Pricing too high is also a mistake. The average prospect typically invites a number of lawn care companies to bid on their lawn and if your price is too high then you risk losing jobs and your marketing efforts will have been in vain.

There are some situations where it does pay to price above market rates. If your business is well established and has a reputation for quality work then prospects will expect to pay a little more. If you are a confident and gifted salesman, or have one working for you then it is also sometimes possible to sign households up for your services at above average rates. Being able to show customers your knowledge of lawn maintenance and proving to them why your services come at a premium price will help you to win accounts.

Never offer a bid over the phone. If you show up in person it gives you an opportunity to check out the property thoroughly so that you can avoid any nasty surprises. You can also show prospects photos or references from some of your current clients. If things go well you can also try to sign them up for other services that your business offers as well.

Lawn Care Business Pricing Methods

Pricing Per Square Foot

If you want to win new accounts it is important that you come up with bids that reflect market rates. If you have done some extensive market research for your lawn care business you will have a fair idea of what local rates are per square foot.

One commonly used pricing method is to calculate the total area of the lawn in question and then multiply this by average market rates per square foot in your area. You may add on a premium to your rate per square foot if you wish.

You should start out by walking around the property, measuring it if necessary and noting down any features that could possibly add additional time onto the job. Buy a measuring wheel if you are not good at pacing or estimating distances visually. Take note of any lawn features that will add on time to the job such as unusual contour or obstacles that have to be mown around.

Put together a price chart based on lawn size that you can present to customers. Such a price list should set out a minimum rate to allow for travelling and set up time and it should allow for adjustment percentages for difficult lawns. You can also include other services that you offer on your price chart.

Charging by the Hour

This method takes more experience to get right but is much quicker and can appear to be more professional.

Examine a lawn and do a mental calculation of the time that it would take you or one of your staff to complete a lawn of that size and shape.

You can then multiply the time estimate by your hourly cost of labor and add on a suitable profit per lawn to arrive at a final price.

Many experienced operators in the US see a rate of $60 per man hour or $1 per minute as being a desirable target for a bid. This is definitely in the upper part of the price range though in most states. Whether you can get this is going to depend on market rates in your area as well as your ability to market your business as a premium service provider.

If you are pricing by the hour never let customers know this as they could feel cheated if you quote them for a certain time period and then they find that you are finishing in a much shorter amount of time.

Pricing a lawn fairly and winning bids is one of the most important aspects of running a successful lawn care business and newcomers to the industry should put some time into developing and refining their approach.