How to Price Commercial Lawn Care [Contractors’ Guide]

Lawn care pricing depends on the number of services. And every other competitor might be charging a price more or less than you. It is quite considerable that you might wonder what the should be price, which is why we have decided to write an article on it.

How to price commercial lawn care is one of the questions many lawn care service providers Google, and only a few have succeeded in setting up the right price. This article is a wealth of information about how to price commercial lawn care services in the correct manner.

So, ready to explore it?

How Much Do I Charge for Commercial Lawn Care?

The question arises, what could be the right price for commercial lawn care jobs? Should you keep your commercial jobs pricing set or variable?

Depending on the current market situation, a lawn care service can cost between $50 and $250. Prices are affected by various factors, including the size of the lawn, the local economy, and whether additional services are requested, including trimming, weeding, or landscaping.

To ensure your employees get well-paid, handle equipment costs and make your company profitable, you should set standard pricing for each service.

Optimizing your workflow is key to balancing lawn care prices, minimizing expenses, and maximizing profits. If you want to get some high-paying commercial clients, then it is advisable to keep the commercial lawn care contracts prices genuine.

The pricing of lawn care services plays a crucial role in the success of your lawn care company.

To charge for lawn services, you first have to understand how you will be able to charge for them, and this is to figure out what your costs will be. There are three main contractor payment methods: by the hour, by the square footage, or by the job.

• Hourly rate

  It is also possible that you can charge for your lawn care services from your commercial client as per the hourly rate, which is the simplest method of charging for your services. 

  Especially if you’re starting and don’t have much experience in the industry, the hourly rate method is excellent for your lawn care business. 

  Additionally, it is a good option if you only offer a limited range of essential services, like lawn mowing and trimming, to your clients. 

  If you are unsure of the time it will take to complete the lawn care job. You can consider charging the cost per hour for your commercial contracts. In addition to your travel time, you will also have to consider other expenses like assigning project managers, hiring a reputable team, etc.

• Charging by the square footage 

  Consider charging by the square foot if you offer more comprehensive services, such as edging, fertilizing, and weed control. 

  This is in addition to your basic services. As a result of this method, it may take a little longer than charging by the hour, but there are a lot of advantages associated with it.

  It is not difficult to calculate how much lawn care should cost in the first place. If you know the size of the yard, then all you need to do is multiply it by the rate you are charging per square foot. 

  In addition, you can also use this method to determine the price of your services based on the level of service you provide. Last but not least, it encourages your customers to use more of your services, which can, in turn, lead to higher profit margins.

• Charging by the job

  You can charge by the job as a third way of charging for your many lawn care businesses. This is a viable option to consider when you have several services to offer or have a lot of experience in the industry. 

  Make sure you consider the amount of time it will take you to complete the job. This is when you price your services based on your job. Also, you need to consider any materials you might need and any other expenses you may incur in the process.

Factors Affecting the Price of Commercial Lawn Care

1. Labor Price

   When pricing commercial lawn care, you will need a few laborers, which is why your pricing plan would differ. Besides, you also need to see whether they charge on an hourly basis or not. 

   You can calculate this by multiplying total labor hours by hourly labor costs.

   For instance, if a lawn care project requires 10 laborers for which you decide to charge $20 per labor, then the invoice would be 10 laborers * $20 per labor (including all the expenses) = $200.

2. Cost of Material

   Material cost is one of the factors that could fluctuate anytime, and it can impact the pricing of commercial lawn care services as well.

   What you can do to price lawn care services accurately is:

   • Note down the square feet of your client’s lawn and their price accordingly
   • Note down the list of materials (weed killer, liquid aerator, fertilizer, and mulch) required
   • Note down every single expense to price lawn care services in the future

3. Overhead & Equipment Cost

   All the expenses that keep the business functioning and productive are a part of overhead costs. No matter if it is computers, office premises, or manpower, everything is part of overhead and equipment costs.

   Most of the lawn care businesses add up 15-20% on the lawn care pricing to meet the overhead expenses. Besides, you must also add equipment and maintenance costs to your lawn care service cost quote. 

4. Margin of Profit

   Once all the cost is noted down, it’s time to finalize the profit margin. For instance, if your lawn care service costs $100 and you want to factor in a 20% profit margin, then the lawn care service price would sum up to $100 + $20 ($100*20/100) = $120. Therefore, you will charge $120 for lawn care services from your client.

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How to Bid for Commercial Lawn Care Projects?

To secure a commercial lawn care contract bid and be profitable, new landscapers must cover all four areas of the business to maintain a viable business. Whenever you estimate a job, you will have to consider your labor costs, materials costs, overhead costs, and your desired profit (after income taxes have been calculated).

If your prices are based solely on your competitors, you set yourself up for bankruptcy. A good way of estimating the price for commercial lawn care contracts quickly and accurately is by figuring out your expense categories in advance, which can assist you in generating profitable commercial lawn care contracts more quickly.

• Determine your labor costs

  Performing the labor yourself might lead you to believe that you do not have any labor expenses. However, you will incur an opportunity cost even though there will be no direct expense. 

  When estimating commercial lawn care contracts, you should bid higher if you can earn a salary of $18 per hour. 

• Calculate the cost of the materials

  As long as you offer only essential lawn care services, such as mowing, edging, trimming, and blowing, your main materials cost might be fuel. 

  Your bids need to include seeds and aeration, fertilizing, and shrub care if you provide these services to your commercial clients and you want to charge them.

  As you go about your accounting, you may include your expenses for spark plugs, air filters, blades, equipment maintenance and repairs, and any other items you may need to purchase in your materials costs. 

  For example, say you estimate you will have $900 in expenses for $300 jobs in a year, and you would have to add $3 to each job to compensate for these expenses. 

  Depending on your formula, you may charge a higher percentage on large projects than on small projects.

• Calculate the overhead costs for the project

  An overhead cost is a cost that is incurred in the course of running a business. Whether you work on vacation or during the winter, you must pay for these expenses. 

  This includes a wide range of expenses that are not directly related to your jobs, such as insurance, a business license, website, accounting fees, bank fees, toner, and other expenses.

• Determine your desired profit

  Do you want to make a certain amount of money each year from your business? Calculate your expenses to see what you need to cover them. It is possible to start planning your expenses using invoicing and estimating software such as InvoiceOwl.

  You should determine the additional savings you would like to contribute for saving targets such as vacations, house down payments, and emergency funds, and then add any extras you wish to contribute.

• Run estimates

  Once you’ve figured out all the numbers, run some projections. Based on the size and service of your yard, estimate your fee. The cost of labor and materials, overhead contributions, and each job’s desired profit should be added. 

  InvoiceOwlallows you to create professional-looking estimates that you can provide to residential clients and municipalities by generating your invoice using the software.

How to Determine Lawn Care Pricing?

Here are the top ways that assist you in determining lawn care pricing:

• Define your situation

  The most effective way to determine your business’s proper lawn care pricing is to create a customized lawn care estimator. This will consider the unique features of your business.

• Determine the profit margin needed

  There has already been a mention of overheads and the importance of having a monthly figure at the forefront of your mind. This is something that you need to attain each month. 

  Following the discovery of this number, the next step is to determine the appropriate profit margin for your business. 

  In business, profit is what remains after overhead costs, materials, and labor costs have been deducted from the business’s profits. 

  Getting a clearer picture of the standards in your area can be accomplished by contacting trade associations. In addition, it can also be accomplished by evaluating your competition to determine what type of pricing model will be profitable for your business.  

  Regardless of whether you need a lawn care estimate calculator that works for everybody, it is not an easy task. That’s why it is often a wise idea to consult with an accountant if you want to get your pricing and profit margins right. In addition, don’t be afraid to revisit pricing every quarter or year, and ask for feedback from your clients regularly. 

• Seasonality is an imperative factor to consider

  As a side note, lawn care tends to be cyclical, so it is wise to consider this. A surge of business is usually experienced in this industry during the spring and summer months. Drop-offs typically occur in the fall and winter, so keep that in mind when calculating your budget.

6 Events to Adjust Lawn Care Pricing

Firstly, you know that your hourly and service rates may vary, depending on service location and business requirements.

The occasions when you must adjust lawn care service pricing are as follows:

• Seasonal Pricing

  Offer trimming, mowing, and watering service in the summer month and bi-weekly snow removal in the winter months.

• Scope-Based Job

  You make changes to the price if the job is out of your scope and slightly different than the initial terms of your services. Sometimes you might have to complete the job before the usual time; in such cases, you might have to increase the price of the lawn care services.

• Gas Pricing

  You even charge higher when your client’s location is far away from your office location.

• Material & Labor Cost

  Another area where you might have to adjust your lawn care pricing is when the supplies cost is more than the labor cost.

• Group Pricing

  When you want to attract group business, you might have to lower your lawn care service pricing.

• Marketing

  In the initial stages of your lawn care business, you might have to offer promotional discounts or keep your lawn care service prices lesser than your competitors.

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Conclusion

Lawn care business is a list of several services that are priced differently. And you would be able to make money out of your lawn care business only if you price it affordably. There can be times when you might overcharge your business and sometimes undercharge, but that’s all part of the business.

Start implementing the methods discussed in the article and start retaining existing clients and making new ones.