"hidden" late fees

[Bobbygedd]

we all pay for the things that other people do wrong. your insurence company will tell you, that because of ficticous claims, your rates go up. your supermarket will tell you that, because of theft, your prices stay high/go up. damn, one supermarket here even has a sign saying, ' return your cart, if we have to pay someone to gather shopping carts, your prices go up." so then, why not us, charge all of our clients, for those who pay late? here is my thought: i am upward of around 100 steady clients now, and many one timers too. i've been strict on my payment terms, and have dumped customers for the following reasons- shorting me $1.25 , being habitually 3-5 days late, needing a phonecall every month to remind them to pay, and refusing to pay the $10 late fee, etc etc. NOW, out of all my clients, i have only four that pay late. one is habitually 7-10 days late. two others are usually 2 weeks late, and one is 3 days late. these are all prime customers because they are neighbors of exsisting clients, and i get top $$ to mow them. ok, so, instead of dumping them, or them dumping me, cus of a $10 late fee every month, why not just "sneek" in a hidden fee of ONLY $6 per client, per year, to cover the late fees that the minority incur? if i were to charge , say 6 clients a season, the $10 late fee, it would come out to 6 clients x 9 invoices =54 invoices x $10 per late fee = $540. INSTEAD of doing this, and risk losing the client, why not add $6 per season (in hidden costs) to each of the other 94 clients, and recover the would be late fees from the 6 that don't pay on time? $6 x 94 clients= $564. you get your late fees PLUS, a nifty $64 extra. how can you hide this measly $6 per client? easy. drop the spreader setting a notch , conveniently skip those shady areas that u know won't get weeds anyhow. jack the price up on an add on service that may arise during the season. seems easy enough to me. thoughts

[grandview]

Sounds like your charging for services not renderd If I found out I'll see you in court!

[pow]

You are an idiot.

[Bobbygedd]

You are an idiot.

very intelligent reply. thank you

[GeeVee]

how can you hide this measly $6 per client? easy. drop the spreader setting a notch , conveniently skip those shady areas that u know won't get

Most will agree that this would be termed- Unethical.

Not going anywhere near your math either.

AND- The situation you describe, and the circumstances faced by the two business entities you provide as examples clearly are not the same.

[Bobbygedd]

well, i've yet to hear an intelligent answer on how late fees should be aplied. we all know that to apply the late fee continuously, will lose the client. but yet, we SHOULD ALL KNOW, that being businessmen means staying on top of things like this. so, i gave you my solution. you don't like it? let's hear some usefull ideas. by the way gee vee, if u think it's "unethical" .......so is paying your lawn service bill late. i see this type of practice in other businesses too. add more ice to the drink...........a smaller portion for the same amount of money.....etc. thank you

[GeeVee]

if u think it's "unethical" .......so is paying your lawn service bill late.

I know its unethical to not give someone the product and service you agreed to give.......

To use your own words against you- "You extended them credit, like you were a bank."

[Bobbygedd]

i don't extend credit.

[GeeVee]

If you don't colect right after the service, you're extending them credit.

[MASTERMOWER]

If you don't colect right after the service, you're extending them credit.

GeeVee, if I remember correctly, didn't Booby once say his customers had to pay in advance???? What ever happened to that?

[Bobbygedd]

GeeVee, if I remember correctly, didn't Booby once say his customers had to pay in advance???? What ever happened to that?

pay attention, this is the last time i'll say it: example of a payment schedule i use: approx 28 cuts per season @$30 each= $840. spring cleanup @$150. fall cleanup @$350. total= $1,340. divided into 9 equal payments of $148.88. the first payment due by march 1st, the second april 1st, the third may 1st, etc etc. ACTUAL WORK BEGINS the first week in april. so, yes, there is money ahead of time. but, this does not excuse the late payments. the payments (as per our contractual agreement) are due, by the due date. any further questions?

[GrassMaster]

It's how you do it & how you say it...

I'm sorry, I feel compelled to criticize Boobies thoughts, but unfortunetly I'm on house watch by GM.

It's OK to criticize the way he thinks, but it's how it's done and done in a way that doesn't really hurt the forum, just read the other replies made. When it's just blown completely out of proportion it goes no where & this is what hurts the forum as a whole.

You don't have to make it a goal to pound him or others you dislike on every thread. Just voice your thoughts & ideas similar to others post here, then let the readers decide?

Where did he go wrong with the first post...
This is where 4 others thought he went wrong, they voiced their thoughts & when I make my post it will be 5 in total.

how can you hide this measly $6 per client? easy. drop the spreader setting a notch , conveniently skip those shady areas that u know won't get weeds anyhow. jack the price up on an add on service that may arise during the season. seems easy enough to me. thoughts

A lot can be learned from this statement & if it wasn't brought out into the open, a lot of people would never known or learned about it. Maybe one day you'll get lucky & have a competitor like the one in the scenario above.

It would be unethical to give less fertilizer than agreed for sure, possibly putting down less in areas that you know the fert will not do any good.

The biggest problem this industry has is lack of Professionalism, business practice ethics is one of the biggest... In general the Lawn Service Business Owners are not taken seriously or as a for real legit business. This forum is here to help change that.

See how I disagreed with his post?

To tell you the truth probably 75% of the people that just started coming here wouldn't know & under stand that the more successful and larger business owners have very strong business practice ethics. In most cases we would never know unless we experience it or read about it somewhere.

Remember up until lately, I would just make the thread disappear, doing this helps no one. Now I'm forced to decide which post is right & which is wrong, because I think threads were messed up on purpose so I would delete them & this has to change. It's so damn easy for me to click on the delete button or do 2 to 3 clicks & move it to the OTF. An easy few seconds task.

Deboning & Cleaning up a thread depending on length can take 5 minutes to 30 minutes easy, because I have to read and decide which stays & which goes. This tremendously adds to my work load, it's not fair to me but it gives more content that has value for the members & nonmembers to read, and this is why the forum is here.

We don't want a fight club here, I feel I'm very liberal & un controlling compared to other forums. At times I feel I'm being taken advantage of?

I should not be put in a position where I have to decide what is the right & wrong answer. Because I do not know all the answers, neither does anyone else.

One of the biggest problems forum members have at forums & I've been guilty of it too in the past at one of the Geek forums I go to, we wake up one day & decide it's "MY" forum and I'm going to be judge, jury & executioner at all cost. I'm going to save the forum with my it's my way attitude and in the long run I'm causing more problems than the person I'm mad at.

Lets say your at a bar or some other kind of social gathering & some one says something you don't like. Do you start yelling at the guy telling him he's a liar, an idiot & how he's ruining you town or your city, then you start following this guy around & do it all over again every time he opens his mouth...

Nobody with any sense does that or they be missing several teeth & visiting the emergency center a lot. Instead you either keep your mouth shut about it or you voice your opinions in a sensible manner, weather you're standing in front of this individual or a 1,000 miles away communicating via keyboard.

I have to deal with unhappy customers quite often at my shop, because most are mad before they ever hit my parking lot. Nobody cracks their cookie having to take their lawn mower in for repair...

Yes it's not a tanning booth or hair salon where they are happy about going. Mower repairs & servicing is a necessary evil. Nobody says I let my oil run low & threw a rod, I had to pay the shop $285 for a new engine & I really enjoyed doing it.

Or I had to pay the shop a $100 to get my belts replace on my rider & I wish I could get it done every 2 weeks. So I'm standing here with unhappy customer and they are reaching for the stars pounding me. You just replace my blade belts 6 months ago & now I'm replacing them again? I wish I had a racket like you do.

It would be foolish if I said well you dumb SOB maybe next time when your grass is knee high you will not engage your blades in the middle of the lawn & burn a spot on your belt. It's the right answer but I'm not looking for a argument or fight or losing a customer...

Instead I say all I know Sir is you got a bad burn spot on your belt, the only way that can happen is the blades were engaged and the blades couldn't turn so the engine turned any way & that's how the burn spot got on there. Your grass was probably real high and or too thick.

In most cases the customer figures out what I'm saying to be true and then they pay the money & go do it again later. I'm not doing this just to handle the customer at hand, I'm doing it for the 3 others standing in line behind him while he's showed his ass at me. When that customer leaves at least one of the others will say you really handled that well or they say how do you deal with this every day.

I say it's part of my job & it was very important that he understands what happened to the belt, but it was more important how the other customers aka witnesses perceived how I handled this particular situation.

If I had taken the low road & told him how stupid he was for engaging his blades in thick grass. I would have lost 4 customers because of my actions. See those customers perceived me as handling it well & not only that all 4 customers now know that if they engage their blades in real heavy grass, that it will burn a spot on the belt & then somebody has to fix it? Hopefully they bring it to my shop.

I'm always after the big picture & how it's perceived in the long run. That's where the money, respect & word of mouth comes into play, thus sending me to the bank more often with larger deposits & a very clear conscious.

We can't learn the right way for everything & not make mistakes. A successful man makes far more mistakes than unsuccessful ones do & they even learn from them.

Our job here is to answer questions if we feel like it & do it in a way that people can learn from it. If we pound the next 10 people that make post, we probably over a years time stop 30 to 50 people from even posting their first question.

You can help & teach a lot of people with the right answer or reply, you can't teach anybody with a verbal beating or lead hammer!

PS: Others are geting post edited & deleted too, you're not the lone ranger!

[Bobbygedd]

grassmaster said:" The biggest problem this industry has is lack of Professionalism, business practice ethics is one of the biggest... In general the Lawn Service Business Owners are not taken seriously or as a for real legit business. This forum is here to help change that." AND I FURTHER IT BY ADDING: there is a huge lack of professionalism, but my statement above is just a mere twig in a truckload of debris. what is "lack of professionalism?" where shall we start? there is a long list that the "real pros" consider "ethical" and professional, yet, in reality, is totally unprofessional. #1 and formost, is my never ending gripe about you boys doing business without contracts, and extending credit without finance charges. if THAT AINT UNPROFESSIONAL, i don't know what is. i asked the grassmaster a while back about his business practices with his sponsers, i recieved no reply, i'll ask it again: do your sponsers pay in advance? is there any paperwork involved, or do u allow your sponsers to advertize here, on a "handshake" or a verbal agreement? my suspicion is, that they are required pay a month, 3 months, or 6 months in advance, must provide a credit card or other form of payment, sign some kind of agreement. the fact is, grasscutting services, as a whole, are not professional. they lack intelligence, and self worth

[GrassMaster]

I reckon I'll volunteer getting hooked in on this one...

i asked the grassmaster a while back about his business practices with his sponsers, i recieved no reply, i'll ask it again: do your sponsers pay in advance? is there any paperwork involved, or do u allow your sponsers to advertize here, on a "handshake" or a verbal agreement? my suspicion is, that they are required pay a month, 3 months, or 6 months in advance, must provide a credit card or other form of payment, sign some kind of agreement. the fact is, grasscutting services, as a whole, are not professional. they lack intelligence, and self worth

Sorry Booby, you were on my ignore list & someone PM'd me about this post.

There is no contracts, mainly verbal agreements. Some pay in advance, some pay per sale via affiliate agreement and some on the honor system. I'm flexible & so far it's working out great, no problems what so ever. I do what I'm supposed to do & they do what they supposed to do.

As far as my lawn service went...
I started out with verbal agreements, then the bank wanted me to have written agreements (Proof of work). I did not impose late fees, I can't afford to lose a customer over 1.5%, 10 or 20 bucks. I lost only a very few in 5 years. I pride myself in customer retention not customer turn over.

I can't afford to be spending time worrying about some one late, yes some were late and it's that way with everybody in this business. I know there is a lot more these days that don't pay like they should, but it's a necessary evil.

I prefer the necessary evil over customer turn over & think most will agree. It's not like I'm going months on 100's of thousands of dollars owed to me.

It's fairly easy to keep customers & it's always a lot harder getting new ones. It takes time & money to get new customers. It takes doing what you supposed to do to keep customers.

You've got to remember, I only did 1 yard my first one for $20. It was a great learning experience. The rest were $35 & up. If I had a customer that was 30 days late on a $185 a month service & then they pay 2 months at one time so be it. I'm not going to lose a $185 or $385 or $2,000 a month customer over a 1.5% late charge. I'm not a lending institute so I don't need to charge late fees.

After my first few years, I kept a minimum checking balance of $10K and went over a year with over $30K minimum near the end of my short but very sweet lawn boy career in the bank at all times. My cash flow was very good & again my customer retention was good. Of course that was back when you got paid more than you do Today for the same service.

I was burned one time in 5 years, yes everybody else paid me believe it or not, I never got the money from the Doctor & he wound up doing time in jail for not paying his taxes, lost his home, his vehicles & a very expensive ungrateful family that he didn't need or could afford!

The pool, the elaborate lightening rods on house, pool house & barn and the painter (Over $15K) never got paid for, so the Yard boy (me) decided it was a complete waste of time.

You got to decide what your time is worth how your time can be spent best?

I'm sure your comeback will be a killer, but you might want to elaborate on complete man hours of time spent per month dealing with late payers, including posting about it & what your customer turn over rate is?

[Bobbygedd]

did you support yourself, wife, and family ONLY ON your lawn income? or was the wife working, and or did u have a second job? question #2- i'd like to advertize on your forum. i will not sign any written agreement (as u said, i wouldn't have to). simply send me your price list, and i'll get the ball rolling from there. i'll pay you...promise. and of course, the fact remains "your short lived carreer, as a lawnboy". i often wonder...why. the owner of another forum, whos name i will not mention, mind you, there are many forums i visited, made this statement, "i did great in the lawn business, really, i did. then one day, i decided to marry and have a family, and it hit me, "i have to get serious about my life"..........that's when i decided to start looking for something else.....