Need advice on commercial rates????

[mhshoc10]

I just started a lawn cutting business in Knoxville a few months ago and up until a week ago had done only residential property. Last week we got a commerical contract but I think we underbid too much, since we have no experience in it. We bid at 40 dollars an hour and estimated it would take 4 hours (the cap was 4.5 hours). Well, it took only 3 hours, so the grand total was only $120 (25% less than what we were hoping). We estimate the property is about 3 acres. Should we charge by the hour or by the acre from now on, and how much money are we probably losing out on since we are only getting paid $120 for this job? All feedback is greatly appreciated.

[TinkerLawn]

If you charge your hourly rate and you charge for how many hours you do work, you can't lose. Even though you were only there for 3 hours that leaves the other hour to go and start your next job. Just make sure you always charge your hourly rate, if you aren't making any money why are you working anyways.

One of the leading companies here in Kansas City charges commercial property, with 48 inch walk behinds, at $45.00 per hour. If you are using bigger machines you can charge more because it is going to get done faster.

But as a scale I would say 48 walkbehind at about $40-45 per hour.

[mhshoc10]

Thank you very much for your reply. I feel much better knowing we did the right thing. I was just looking at the property and felt we could be making more money simply because of the size of it, hence the feeling of failure since we only got 120 for it. Once again, thank you very much for your reply.

[Scaper-S2k]

When you said it took 3 hours, how many guys were on the site helping?

[mhshoc10]

Just two guys. Me and my partner.

[Scaper-S2k]

Then it took you 6 man hours for $120. That's $20 per man hour hour which is very very cheap for most green industry work these days.

You should be able to bid at least double that amount.

[MASTERMOWER]

Myself, in my market, wouldn't dare bid less than $40 or so per man hour on commercial work. I gross an average of $45/hr on residential mowing.

[mhshoc10]

Ahhh alright. Well at least I'm learning early. I had a feeling 120 was too low, but I already bid the guy at 40/hr so I couldnt increase that number. Well I do appreciate all the feedback. Have a happy 4th of July.

[mhshoc10]

Out of curiosity, anyway of finding members from the East Tennessee area to see what commercial rates they are charging (since I presume it varies from State to State)???