So called "Gold clients"

[PurdueJoe]

Everyone has those "gold clients" that call year after year maybe good for $500 a year or $10,000 but you know you will get that call year in and out. I had sold roughly $3,000 to a client for winter work on a horse farm who I had done work for the last 3 years straight. Nothing fancy just raise a lot of crown raising over fences to bushhog and drop some dead nasty trees. Well I call the the client up and tell him I'm ready to start his work and he then gives me this sob story about how he had this guy that use to work for him( he owns a factory) left him and started a landscaping company and his about to go belly up if he didn't find any work so he came up and took care of MOST of the tree work? The best part is that the most part was stuff that this lawn jockey was to scared to handle like dropping large dead, hollow trees near the property lines with new fences just installed, same style of trees near structures and trees near power lines. So the question is Do I make a point and charge a ton for the remaining work left or eat crow and just do it at a regular rate. I'm so POed that I plan on making a point. When I started in to arboriculture I rode home with an old timer that made one point very clear "There's no loyalty in tree work, you'll do great work for a client one day and then the next day you drive by their place and see another company doing half the quality of work" I didn't believe him then but I guess I had to experience for myself.

 

[squad143]

I'd do it at the regular rate and eat crow for now. Chances are the landscaper will go belly up and you'll get the work back. Give this guy the shaft and you'll most likely get the shaft back.

 

[ccrider2240]

this stuff happens all the time, do your work and charge him what you reg. charge for this sort of work,,,,, live another day,,,, when he is in a pinch all will be remebered.

 

[Dadatwins]

With the ecomony the way it is, this will be happening more and more. The old timer was right there is no loyalty in this industry, especially when things are tight. Take what you can get and move on.

 

[OLD CHIPMONK]

It helps to develop a thick skin; like um...alligator or "Rope" opcorn:

Grin & Bear it; I'm not to proud in this economy.... Just survival...

 

[TimberJack_7]

One thing I learned at Davey Tree a long time ago is that 99% of people couldn't care less about the quality of tree work, all they care about is the cleanup. Just do a good cleanup and people will think worlds of your work....

 

[BC WetCoast]

Your regular rate with a PITA premium.

 

[Ghillie]

Was the customer getting a "repeat customer" discount?

 

[ponderosatree]

One thing I learned at Davey Tree a long time ago is that 99% of people couldn't care less about the quality of tree work, all they care about is the cleanup. Just do a good cleanup and people will think worlds of your work....

And I used to wonder why Davey had such a bad reputation.

 

[treeman82]

Take the work at a normal rate and live to fight another day.

 

[TimberMcPherson]

Been in a VERY simular situation. Ended up doing the job and made the other guy look so bad he wasnt asked back. I wouldnt up the price, just be professional and do the job as you normally would. You can only loose if you take this to personally

 

[outofmytree]

Been in a VERY simular situation. Ended up doing the job and made the other guy look so bad he wasnt asked back. I wouldnt up the price, just be professional and do the job as you normally would. You can only loose if you take this to personally

Spot on TM.

This is a great opportunity to increase your business Joe. Book the client in at the regular rate and make a point of doing a little extra whilst you are there and be sure to smile on the way out.

Do the math. This guy sends you 3k of work. That is what, 1% of the turnover of a 1 truck business? If you burn him you will certainly lose his business because he is embarressed and has already demonstrated his "loyalty". On the other hand, because he is feeling guilty, when you do the job for the same rate and do a little extra work for free he is compelled to tell his friends and associates. Most people associate within there socio-economic strata so it is likely that anyone he tells will have the same sort of bucks and perhaps need the same sort of work... So the worst case is you have lost 1% of your turnover compared to the best case of gaining 1-5%. Now exactly how much advertising do you think you would need to do to gain between 1% and 5% turnover and how much would that cost?

 

[John Paul Sanborn]

I would offer to do the work at the regular price. Did you offer a volume discount on the bid?

At least you found out before scheduling a full day with a larger crew.

Look at the bright side, there is still work to be done. Just make sure you do not badmouth the other guy while you are with the client.

The sales term for this type of clientele is "revolving account". Many refer to them as cyclical: as in semiannual, biannual, 4 year cycle... You treat these people as well as you can as long as you still make money on the account. This is because they will make money for you with referrals, as well as the return business.

My "simple math" example is that if you have: a $300,000 portfolio of revolving accounts, that generate an average of $1000, on a three year cycle, you have a $100,000 gross revenue per annum from 100 days of work.

If you do a realistic work budget there are just over 200 days per year, so you can see the logic in building such a portfolio over chasing removal bids all the time. With the portfolio, you only have to generate work for another 100 days to make ends meet.

If you average $800/day on a 200 day year, you have a $160,000 income budget for the year. This means you need to sell an additional 60k per year to make the budget. After that the rest is the gravy.

the 200 day year is 4 days average per week, 50 days per year. This covers all sick, vacation, weather, weekend, breakdown, cancellation, employee no-show days one can think of.

 

[Ghillie]

the 200 day year is 4 days average per week, 50 weeks per year. This covers all sick, vacation, weather, weekend, breakdown, cancellation, employee no-show days one can think of.

Is this what you meant?

 

[MonkeyMan_812]

When I first read this post it made me mad thinking of the times this has happened to me. But I think its best to listen to everyone else and not burn this bridge. But I would charge a little extra just because when you bid those tree at that price it was 'due to' volume of work. I would price each tree a little higher and go for it.

 

[outofmytree]

I would offer to do the work at the regular price. Did you offer a volume discount on the bid?

At least you found out before scheduling a full day with a larger crew.

Look at the bright side, there is still work to be done. Just make sure you do not badmouth the other guy while you are with the client.

The sales term for this type of clientele is "revolving account". Many refer to them as cyclical: as in semiannual, biannual, 4 year cycle... You treat these people as well as you can as long as you still make money on the account. This is because they will make money for you with referrals, as well as the return business.

My "simple math" example is that if you have: a $300,000 portfolio of revolving accounts, that generate an average of $1000, on a three year cycle, you have a $100,000 gross revenue per annum from 100 days of work.

If you do a realistic work budget there are just over 200 days per year, so you can see the logic in building such a portfolio over chasing removal bids all the time. With the portfolio, you only have to generate work for another 100 days to make ends meet.

If you average $800/day on a 200 day year, you have a $160,000 income budget for the year. This means you need to sell an additional 60k per year to make the budget. After that the rest is the gravy.

the 200 day year is 4 days average per week, 50 days per year. This covers all sick, vacation, weather, weekend, breakdown, cancellation, employee no-show days one can think of.

More sound advice.

Using JPS' approach I rethought my quoting and in what other arborists are calling hard times over here I am booked out further in advance then I have ever been in Autumn.

 

[John Paul Sanborn]

Is this what you meant?

D'oh!

 

[Ghillie]

D'oh!

LOL... I still like the way you work the numbers!

 

[Henry111]

Ive had the same done to me ok, And thinking smart most people would bite the bullet and make the money. Now me on the other hand Im :censored:king loyal to my word and tell those kind of people to stick their money up their :censored:sssss. theres way more imporant things in this world than money, NOW THATS JUST ME i won't bend over..... FOR MONEY.

 

[John Paul Sanborn]

I don't understand people getting so worked up over a bid. I can see getting a bit annoyed, especially if you spent a good deal of time working up the numbers.

Just go in and do a good job for what the job is worth to you.