Having your lawn care customers on annual contracts can be very beneficial especially during the winter months. If you are not so good budgeting out your money and tend to spend what you have, then maybe having lawn care customers pay you an equal amount each month would be the way to go. The customer can benefit from this as well because they will be paying the same price every month and they can easily fit it into their budget.
We discussed the benefits of having lawn care customers on an annual contract in a post at the Gopher Lawn Care Business Forum. You can join in on the discussions as well.
What is the best way to present the annual lawn care contract concept to your customers?
Chuck: “People are hesitant to to sign up & pay $70-100 per month to you when they just met you & the next few months the grass doesn’t grow much.
I seem to have better luck during the summer with simply saying verbally: I also offer monthly billing, I know Mrs. Smith that $30 a week is a lot to pay for lawn care & this time of year that can mean $120 -$150 a month! So here’s what I do, I’ll do it for $100/ month year round. It’s more budgetable for you & I can better budget my business knowing exactly what’s coming in. Basically, I agree to make less during the Summer & Fall & you agree to help me feed the wife & kids in the winter time. Either way it’s up to you ma’am. Which way would you prefer?
I did pretty well, No I didn’t get every one. But I’d say more than half to choose the contract option!
The property lots here in our area are 80′x125′ and if they are on a corner they’re a little bigger. Last summer provided it’s a normal house (normal amount of landscaping, fences, ditches to line trim around) I would quote $25/cut or $85/mo year round. I didn’t specify much as far as frequency other than to say during growing season I’d be there weekly & out of season It’s usually about twice a month. On a corner lot it was usually $30/cut or $100/mo.
A couple months ago as things slowed down with the per cut customers I really learned the value of those annual accounts & I need to stack on more annual accounts over the summer to be in better shape next winter. So I found a way to get the pricing more competitive & lean the cards so I would get more annual accounts than per cut ( in theory anyway we’ll see ). Part of my new proposal form looks like this:
This proposal is for: the property at the address above. Normal services include mowing, line trim, edging, blow off all concrete walkways/driveways.
In this proposal the monthly fees are based on 34 services (visits) per calendar year as follows:
Month = # of visits to be made under this agreement :
Jan.= 1, Feb.= 1, Mar.= 2, *Apr.= 2, May= 3, June= 4, July= 4, Aug.= 5, Sept.= 5, Oct.= 3, Nov.=2,
Billing options: *Per cut (weekly In summer months) $ * * wk or Monthly billing with annual agreement $ * * per month.
So for example the same lawn I had been quoting $25/cut or $85 /mo. before I would now do this.
If I want $25/ cut: *$25 x 34 services/yr = $850 divided by 12 months is $70.83. Rounded up I quote $25/cut ot $71/month.
My prices are more competitve & I still make $25/cut when all is said & done.
If they need an extra cut in there its just that… extra!”
Now that is a very interesting way to sell the concept of the annual lawn care contract to new lawn care customers. Consider this when you are out there signing up lawn care customers as well. You might find the monthly price you quote on an annual contract, a little easier for the home owner to accept. You still get paid the same amount in the long run but the monthly prices are cheaper for the customer. Join in on this discussion further at the Gopher Lawn Care Business Forum.