When you are first starting your lawn care business, how do you find how much you should charge to mow a lawn? This is a question that was recently asked to us on the Gopher Lawn Care Business Forum. Here are a few ideas.
First off, if you haven’t done so, log onto our lawn care business forum and post your question along with your region. There is a good chance another lawn care business owner in the area can give you the going rate. You may also want to ask yourself, do you have any friends in the business? If so, ask them what they charge per lawn.
Another response that was posted was to contact a few local lawn care businesses in your area and get an estimate from them to service your lawn. If you don’t have a lawn then ask a friend to get a few estimates to service their lawn. When you have three estimates, you will have a good idea how much to charge. You will know the price, plus you can find the square footage size of your lawn and you can divide that out to figure how much to charge per square ft. This should give you a ballpark idea. Keep in mind, the expenses you have to run your lawn care business can drastically differ from another lawn care business owner’s expenses, so know your expenses.
The next question you may be wondering is should you charge by the square foot or man hour?
Kurt Chance said “The first thing you always want to do, when giving an estimate, is actually walk the property and don’t be in a rush to get in and out. I did this once and when I got there I was in for a surprise. I didn’t know there were four ditches in the front lot that would need to be manually trimmed and gone around while mowing. Luckily for me it still took the estimated time that I figured and my price still worked out to what I wanted.”
If you are a new lawn care business owner, you may want to charge based on man hour. Author Joel LaRusic of mowboy.com suggests “you want to quote quality, not time. In other words it’s better to say “I’ll perform these set of services, to your satisfaction, for $50” than to say “I’ll spend an hour at your house for $50.” Of course, you can use your hourly rate to base your price on but you don’t need to pass those pricing details on to the customer. You don’t want the customer watching the clock and as you get better at your job and shave a few minutes off of it, that should be to your advantage.
Kurt explained further “What I do when estimating large properties is I figure out how long it’s going to take me. Break it down into smaller sections if I have to. Then I figure my hourly rate or what I want to make from the property and put a price together from that. A lot of times commercial properties are going to be broken up into a few mowing areas, I find it easier to just figure out the time it will take for each and then figure out the total time plus drive time.”
Another more advanced method is to charge per square foot based on formulas. Using formulas requires a little more experience, because it is important your formulas are accurate. Remember, your quote will only be as accurate as your formulas. However, if you are confident with your pricing you can create formulas like:
Cost per 1000 square feet to cut lawn.
Cost per 1000 square feet to fertilize lawn.
Cost per linear square foot to trim a hedge.
How do you create your own formula? You will need a measuring wheel or surveyors wheel to walk the property and figure out the square footage. Joel said “many jobs, such as fertilizers and over seeding, are quoted per 1000 square feet.” As you are in business longer, you will have a better understanding of your operating costs, that is, how much it costs you to operate your business per hour. You will know how long it takes to cut a 1000 square feet of lawn and you will know the profit margin you want to shoot for. From there, figuring out your formula is as simple as taking your overhead expenses adding your profit margin and this will give you your cost to mow 1000 square feet of grass.
Do you get the idea? You’ll have to measure everything accurately but once you get some good formulas the job of estimating lawns gets pretty easy. Of course, you may need to make adjustments (the cost to cut a heavy slope would be more than a flat lawn) so you will have to use your judgment.
Which pricing method is better for your business? If you are just starting out, it’s easier to charge based on the hour. As you grow you will want to create formulas to help you more accurately bid on properties regardless of their size. Estimating lawns by the square foot gets more important as you mow larger properties. It allows your bids to keep a steady profit margin regardless of property size. Many new lawn care business owners tend to price small properties at a reasonable profit margin but barely break even or even lose money on larger properties. This happens because they underestimate the amount of time it takes to mow a property and as they service larger properties, their mistake get magnified. Accurately bidding on properties that allows you to consistently hit your desired profit margin is a big key to success. Many growing lawn care companies go out of business because they lose money on mowing large accounts and never even realize it. Don’t let this happen to you.
