We’re just about ready to get into winter time. Now is the time when most people sit down and say “Hmm, I should have made more money last year and I didn’t.”
One way to make more money is to raise your lawn service prices, right?
If everybody pays more, boom, you make more money. Well, that kind of makes sense if that were the only factor involved but there are many other factors that get involved when you consider raising your lawn service prices.
When we’re talking about raising prices between seasons, that is probably the best time for you to do it. Although, you should write all your contracts so that you have either 30 or 60-day notice so that you can raise lawn service prices on your customer if you give them 30 days notice or 60 days notice.
We do that with all of our “agreements,” we don’t do contracts. Contracts tend to be a legal term and I just try to stay away from that. I just do an agreement because everything that we do in business ought to be a win-win. If my product is right for you and your money is good for me then everything’s fine, and it’s a win-win, and we move forward.
So the question comes up, should we raise prices; the answer is yes and no.
Don’t you love those? They’re always there.
But the yes and no… That yes is this is the time to do it because you want to establish yourself for next year. But the no is that; do you really want to raise prices on everybody?
Next week, we’ll talk about why you don’t want to raise prices on everybody. But this week, we’ll talk about raising prices, in general. What does it do?
You can sugarcoat it. You can say “Oh look at the economy, or labor, the gas prices, the whatever.” However you want to put it, you put the reason in there, and you say “I’m raising prices.”.
What you’re saying to the customer is “I’m raising my prices, and I want you to go shop and see if I’m still a good deal.” Make sure you are because that’s what we would do if, say, we got a letter from our insurance company that says they’re raising prices this year.
So you’ve got to ask yourself; do I really want to stir the pot? Because if you stir the pot something might come out, right?
The Status Quo
In a business, in general, my philosophy for business is — “Be as boring as possible”. Our contracts go on. They’re perpetual. They go on year after year after year unless there’s a change in price and then we just send a notification. And that’s it.
The good thing about that is that we show up the next spring and we just start cutting the lawn. Now, it is true that you might get a couple of people that say “Hey, I already signed up for somebody else” or “I don’t want you to do my service or my house anymore.” Or in the rare case that somebody sold the house during the winter time and here you are cutting somebody else’s house. So there has been the time or two when we’ve had that happen but when you counter that with sending out a contract to everybody saying “Do you want to continue with my service?”.
Cutting a few lawns for free is not a big deal compared with, first, the amount of time and office time and time on my part that it takes to actually make these contracts and, second, send them out.
Plus, the opportunity that you’ve given your customer to say no.
Never give your customer the opportunity to say no if possible. What I mean by that is, when you go to a good salesman and you go into a car lot you say “I want to buy a car”, he says “Do you want to buy this one or do you want to buy that one?” He never says “Do you really want to buy a car?” — That’s questioning your customer. That’s questioning their wisdom and kind of questioning their decision, already. You don’t want to question that decision.
What you really want to do is say — “Do you want this service or that service?”. “Do you want to upgrade to our deluxe do you want to do something better than you did before?” That would be the question that you would pose with your customer. Certainly not the question of do you want to continue doing business. Do you still love me? No, assume that we do. Assume that your customer wants to keep doing business and just make that assumption and move forward.
Should you raise your lawn service prices between seasons?
- If you’re going to raise your prices, that’s the time to do it.
- Have perpetual contracts. Don’t go through the mess of having contracts and redoing those contracts and having people sign them and send them back. What a pain. We used to do that, and we’d have people having to get on the phone and calling everybody, saying “Are you sure? Why haven’t you sent your contract back in?” Just leave it alone. They don’t want to be bothered. You don’t want to be bothered. Let it be.
- You want to be careful who you raise prices on.
That’s what we’re going to talk about next week because you don’t want to raise rates on everybody. That could be very damaging to your company.