Have you ever been in a situation where a lawn care customer signed up for a year’s worth of lawn care at a discounted monthly price and then backed out of the agreement half way through the year? Any time you are using annual contracts, this kind of thing can happen. How should you handle such a situation though? As we will see from this discussion on the Gopher Lawn Care Business Forum, if you handle it well, you may get referrals from the customer, but if you handle it poorly, they may bad mouth you.
One lawn care business owner wrote “a¬† client of mine wants to cancel service, due to losing his job and needing to cut costs. He was paying a flat monthly rate. Would you refund him based on services provided versus what he paid, or since he broke our agreement, only refund him this month (the month he walked away)? We have no signed lawn care contract.
He was paying a flat, monthly rate for x number of cuts to be received throughout the season. He only received y number of cuts thus far, so I am thinking about refunding him x-y.
I could also refund him what he had prepaid, and agree to take a discount on that amount because he was backing-out on us, even though we didn’t have a written contract. I’d like to leave him on good terms as I would still like him to refer us to his neighbors, friends, family, etc. Perhaps we’ll get us some more business from this?
For the future I think I need to put a disclaimer on the proposal for level billing that if it is not finished-out, there will be some sort of penalty or fee. It hurts to lose customers, but hopefully I will be able to replace them 2x over from positive word of mouth.”
A second lawn care business owner said “if you believe this is a reasonable request and he has been a good client in the past, I think a refund would be appropriate. BUT not for services you have already performed. One other point, and an example is, if he paid you $60 a month for service that you would normally charge $80 for, but gave him a monthly discount rate, then what you have done for this month should not be discounted, but it should be pro rated at the higher rate, then refund the rest. If you explain this to him there should not be much problem. But you never know how someone will act in this situation.
If you believe he is giving you a line of BS for what ever reason, (maybe he found some low baller who will do it cheaper), then you might approach it a different way. Break the payment for this month down to how many weeks of service have been performed and how many are left, then keep one or two weeks worth of payments and refund the rest, and again explain this is your ‘normal’ cancellation process. He may not like that, especially if he is getting cheap service from someone else, but this was his choice.
If you give him the benefit of the doubt, he will be more likely to recommend you later, and if you part on a bad note he will bad mouth you for sure, which will not help your business.”
Read more about Lawn Care Business Bidding Tips, Upsells, And Disasters To Avoid. Learn how to improve your bidding process with this book and be prepared before hand by knowing what you should be looking out for before a problem occurs.