Looking To Increase Your Rates?

By Andrew Duncan
From the Spring 2019 Issue

One of the most common complaints I hear from business owners in the landscape field is that labor rates as a whole are too low. In our business you are always going to be competing with companies underpricing their work, whether that is someone who mows lawns on the side for extra income or a new business who doesn’t fully understand their numbers. As an industry we aren’t very good at creating value, and it is a tough battle when you are trying to bill double to triple what the kid down the street will charge. However, there are companies out there that are consistently getting new customers while still charging profitable rates. What is their secret? Selling.

(Photo: Bedney Images)

You may think, “Well I’m already selling every time I go meet a potential customer.” Take a hard look at your sales process: are you really selling value, or are you just listening to the customer and giving them a price? The majority of businesses are going to a quote, trying to jot down everything the customer wants, and formulating a price for the required services. This process is not only robotic and impersonal, but also decreases your value as a company. Have you ever gone to the doctor and said, “Hey doc, I have some chest pains,” and had the doctor only reply with, “Okay, that will be $500.”? I certainly wouldn’t trust a doctor who just threw a number at my problem without explaining the issues and their plan of attack. And a landscape company is no different.

I can already hear the grumbles from some of you saying, “What can I really say about mowing grass?” It’s simple—tell them your process. A few years ago, we switched the majority of our mowers to walk-behinds for our residential customers. A homeowner is not going to notice what mower you are using nor are they going to care… until you tell them the reasoning. Once we switched, I started telling all of our new customer leads that we have switched to walk-behind mowers because they have a better cut quality and require the operator to really take their time—which not only makes their lawn look great but also cuts down on tearing up lawns when a stand-on or ride-on mower turns. Almost everyone I met with had some horror story of their previous company always tearing up the edges from turning too quickly. We instantly saw an increase in interest in our services and we were able to win customers, even with a higher price tag than the competition.

This isn’t a knock on ride-on or stand-on mowers either. In fact, at some of our large commercial properties we focus our sales pitch on the efficiency of our larger ride-on mowers and their bagging capacity. It all comes down to your value proposition to that specific customer.

This is even more important when you get into higher end services. If you send a quote for pruning without explaining your process, then you will be compared against companies that offer low quality work. (Think hedge trimmers to a Rhododendron, yikes.) Meanwhile had you explained how your company hand prunes certain shrubs as well as the downfalls of machine pruning specific bushes, you will instantly look better than the competition and can more than likely charge a premium price for your services.

Another, and possibly better example is hardscaping. If you explain the importance of using the correct base material, the correct compactor, and using a laser level to get your pitch absolutely perfect, you will look better than competition who just goes in and gives a paver recommendation and a price, even if they use the same tools and process.

If our industry wants to increase rates, we need to increase perceived value. As operators in the field we know our value but without the customers knowing the importance of a professional company we will never see that price hike. The key to higher prices, better quality customers, long term growth, and a more profitable industry is informing clients instead of just sending out an estimate. Don’t let customers buy just based on price. Let them make an informed decision based on price vs. value. This will not only increase the number of clients won but also increase your worth to that customer and help the landscape industry collectively increase profit.

Duncan has worked for his brother Chris in different capacities since 2006 when Central Mass Landscapes, a full service landscaping company based in Worcester, MA, was formed. He attended the University of Massachusetts in the Landscape Architecture program graduating in 2015. Duncan focuses on sales, implementing an outbound marketing and sales program which has grown the company’s commercial landscaping and snowplowing division, as well as the landscape construction and site work divisions.

Do you have a comment? Share your thoughts in the Comments section below or send an e-mail to the Editor at acosgrove.turf@groupc.com.

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