How to handle low-ballers?

[C&PLAWNCARE]

I have been putting out flyers & door-hangers and as I was doing a nice profitable neighborhood I seen where another lawn care business had already handed out his flyers and had a price on his and he was advertising at $30.00 with no contract. These homes are on ½ to 1-acre lots these are easy $40.00 to $50.00 if not more but know they all thank they should only have to pay $30.00 per cut not what I am quoting them for.
This guy is a fly by night company and he has came in our town (Madison, Al) and is now making it some what hard for us who is doing lawn care for a real business.
I know this is the name of the game but business like this pisses me off!
Is this really worth the worry?


C&P Complete Lawn Care

[knowltondata]

Find him and bash him over the head.

[Phil Nilsson]

I have been putting out flyers & door-hangers and as I was doing a nice profitable neighborhood I seen where another lawn care business had already handed out his flyers and had a price on his and he was advertising at $30.00 with no contract. These homes are on ½ to 1-acre lots these are easy $40.00 to $50.00 if not more but know they all thank they should only have to pay $30.00 per cut not what I am quoting them for.
This guy is a fly by night company and he has came in our town (Madison, Al) and is now making it some what hard for us who is doing lawn care for a real business.
I know this is the name of the game but business like this pisses me off!
Is this really worth the worry?


C&P Complete Lawn Care

At your prices ... YOU might be lowballing the "next guy" ...

[MGO]

Just wait for him to go out of business....it won't take long!

[Woody]

Like MGO said. If he's cutting an acre at 30 dollars, he'll soon be broke.

Also... Here is one I like to use.

"Well, Mr. Homeowner, yes, my price IS higher. But, with me you know that I am a REAL business. And because of that, I carry liability insurance. Here is a "statement of insurance and financial liability" from Nationwide Insurance. I'm sure you've heard of them. Yes, see right here? I carry 1 million dollars worth of liability. Now, what a lot of people DON'T know is this. If that cheap guy comes in and cuts your lawn, and happens to cut off one of his toes while doing it, guess who is liable? That's right, YOU are. Well, your homeowners insurance is. And you can bet that some jury will award him a huge settlement, because he can't walk right ever again. And he'll claim he can't WORK ever again either. Now, your insurance company will have to settle up with him. But that isn't the problem. The problem comes when they DROP YOU. They will do this because you hired an uninsured contractor, and they will see you as a great financial risk. When you go to look for homeowners insurance again, it will be a nightmare. Most companies will refuse to insure you, and the ones that will are going to charge you BIG dollars to do it. Now, you are probably saying to yourself "this is just a sales tactic". You are correct, Mr. Homeowner, it is. But, it is also THE TRUTH. Just call your insurance agent and find out."

You'll notice that, while you are saying this, most people will open their eyes up REAL big. They NEVER thought of this! Now they see HUGE financial loss in paying higher insurance. And usually, they realize that paying twice the price for lawn service isn't NEAR as bad as paying 2 or 3 or 4 times the price for homeowners insurance. Or even worse, living WITHOUT homeowners insurance. Most of the time they sign right then and there.

Just point out the reality of the situation. Oh, and ALWAYS have a statement of insurance with you!

Woody

[work it]

Excellent point Woody, and one I used quite a few times last year. Sometimes it works for me and then there's other times where the homeowner is too cheap. And in that case I don't want them as a customer anyway.

C&P, I'm glad you're not operating in my area. $40-$50/acre is too low for me. I would consider you as the lowballer here. I make $55-$65/acre and I'm not willing to come down with gas, parts, insurance, supplies and everything else going up.

[Phil Nilsson]

C&P ... give the prospect a written guarantee of the work ... 100% complete satisfaction (or go back fix it) or there is no charge. On this same piece of paper 81/2" X 11" ... make a short list of what the customer should look for and beware of when hiring a contractor. Insurance, experience, licenses, background ( like is the guy a crook" ... ) and that sort of thing. BBB "member" show it. Stuff to build confidence in YOU and create some DOUBT in any competitior. Bang! the account is yours ... baby! ...

The guarantee wants to look "official" ... buy some light brown parchment looking paper ... have it printed ... this is a powerful thing that you hand to the customer.

What more can you do? ... it's a numbers game too ... bid everything in sight, some you win, some you lose. Try to have enough fishing lines in the water to pick and choose the accounts that you want.

[MGO]

Woody.....VERY WELL said!

[r&w landscaping]

hello people i want to know if anyone know there some infomation out there for me on bidding on jobs

[jagmagic]

I never have understood these complaints of "lowballers". I got accused of that where I live and I clear $100,000/yr. I am cheap compared to the compatition, but with how I market my target areas I can be cheaper and make a profit. The problem is a lot of people in the lawn care business are a little arogant and think their services are worth more than they really are. Maybe you should examine ways to work harder, cut costs, and be more competative. Or you could simply target the right areas where the customers are more concerned with quality over affordability. I have one customer I know I'm way to high on, I overbid it last year because my schedual was full. This year I raised his price again sighting gas prices and he's staying with me at a rate of about 3 times what I would charge for a lawn of his size, but he is convinced I am the best act in town so he pays for it.

just adapt to what your comp. is doing. Maybe hire some cheaper help get some used cheaper equip and start an "economy" devision of your company to compeat against the "lowballers" and beat them at their own game, you should have deeper pockets than them if you have been in it for a while.

[cmorris]

I never have understood these complaints of "lowballers". I got accused of that where I live and I clear $100,000/yr. I am cheap compared to the compatition, but with how I market my target areas I can be cheaper and make a profit. The problem is a lot of people in the lawn care business are a little arogant and think their services are worth more than they really are. Maybe you should examine ways to work harder, cut costs, and be more competative. Or you could simply target the right areas where the customers are more concerned with quality over affordability. I have one customer I know I'm way to high on, I overbid it last year because my schedual was full. This year I raised his price again sighting gas prices and he's staying with me at a rate of about 3 times what I would charge for a lawn of his size, but he is convinced I am the best act in town so he pays for it.

just adapt to what your comp. is doing. Maybe hire some cheaper help get some used cheaper equip and start an "economy" devision of your company to compeat against the "lowballers" and beat them at their own game, you should have deeper pockets than them if you have been in it for a while.

I totally agree, Lawn Care is going to have to do what the rest of America is doing, finding ways to cut costs and keep overhead down. It may not be today that this happens, but it will happen. We will have to ask ourselves, for example, "Do I really need that 60ztr to cut residential (average size lawns) or will a 48 w/b do just fine?

I keep my overhead very low, so I probably am considered a 'lowballer' by some. I actually consider myself a better business man.

[Phil Nilsson]

"I keep my overhead very low, so I probably am considered a 'lowballer' by some. I actually consider myself a better business man."

Better to reduce costs by one dollar than increase sales by the same amount ... you probably know that but others may not.