Do you worry about......

[Brush Hog]

What your competition is charging ? I'm some what new to tree work but I find myself getting off track with the idea I'm not charging enough. Don't want to be the lowballer on the block. I charge for my/worker time and equipment but don't have a lot of overhead so my price should be lower than someone with high overhead. I hate having time on my hands

 

[lawson's tree s]

id charge what you want . i wouldn't worry about being the lowballer on the block as long as your making money and are happy doing the work thats all that matters. i learned a long time ago that the competion will tell you to raise prices etc. cause your taking jobs from them. i never worried about them too much as long as my bills are paid and theres food on the table is all that matters to me.

 

[Brush Hog]

Yeah all I'm concerned with is profiting from jobs I do. I just hate to think I left money on the table. Maybe I'm getting to greedy but I just like to make as much as I can per job. I think everyone thinks that way though

 

[lawson's tree s]

yeah seems like we can never make enough money. as soon as you start making money and putting it away stuff will break or a bill comes up out of nowhere. that's how it works for me. i make out on some jobs real good and others i might lose a little but it all evens out in the long run,

 

[Treeman587]

I do. It is good to be competitve. I am usually within a couple hundred dollars.

 

[treeseer]

I charge for my/worker time and equipment but don't have a lot of overhead .

What does your overhead consist of?

 

[Brush Hog]

My overhead is fuel, insurance, rental on chipper, any dumping fees if apply and wages. My truck and saws are payed for. Saving for a chipper but renting fits now. I get new chipper and no maintenance or payments

 

[ATH]

My overhead is fuel, insurance, rental on chipper, any dumping fees if apply and wages. My truck and saws are payed for. Saving for a chipper but renting fits now. I get new chipper and no maintenance or payments

Are your next truck and chainsaws paid for too? How about new (brakes) for your truck? How certain are you that your new chipper will not have any maintenance?

It doesn't sound like you are charging enough overhead... Think about making "payments to yourself" for future needs. It is great that you do not need to borrow and good management now will keep you viable into the future.

I agree with the other comments that your pricing structure should be based on what it takes to keep you running. To me, knowing the pricing of the competition helps me know if I can afford to be in the market. If I think I need to charge 50% more than everybody else, I probably need to find something else to do. If I can charge 50% less and perpetually pay the bills, the other guys better find something else to do.

Do good work, and don't worry if you are accused of "lowballing" others in the market. Above all, don't lowball yourself out of the market. This is a lesson I am learning myself. It is hard to believe how many unexpected expenses come up.

 

[arboristman]

its a fine line really when you think about it.
if you keep under pricing everyone else.
the others may tend to start lowering a bit.
all this is doing is driving down the whole local tree service community.
so in a small sense, it hurts your line of work.
i figure,i should loose at LEAST 1 or 2 bids out of 10 estimates.
this lets me know im in the ball park.
and that im right up there,and im slightly always pushing the line of works income ability.
once your in it for a few years,and always do super work.
that word gets around,and in most cases they wont even get a second bid.
this happens to me allot.
but always be fair of course.
the tree service owner should ALWAYS make out good at the end of each job.
this is hard dangerous work,and we really do deserve good pay for doing it.
allot of times,you will be told what others wanted for the job,after you let them know your price,and that helps to keep you informed also.
always do high quality is KEY.
if you do this,success is sure to follow.

 

[Brush Hog]

Fee's are included for the unforeseen repairs and upgrades. I new I'd forget something.

Do you use new price(of equipment) to figure out per hour charge ? Maybe I am not charging enough :bang: :bang: :newbie:

 

[daveyclimber]

I try to get $200 per hour. based on a 6 hour day. I would say on average we get half of the jobs we bid. We generally work 4-7 days a week during spring summer and fall. I really can't handle much more work at this time and point but it does get mighty irritating when you find out a price of your competition and you just can't figure out why they are still in business. If you have a clean cut crew, nice equipment and a truly professional service why not push the envelope a bit. Try it on small jobs, just bid them a bit higher than you normally would and don't forget to sell yourself and make your company stick in their heads

 

[ATH]

...but it does get mighty irritating when you find out a price of your competition and you just can't figure out why they are still in business....

Are you referring to the ultra low bidders?

I suspect:
*No (or inadequate) insurance
*Paying employees under the table
*Quick/halfa$$ work

I know I am a little lower; but like Brush Hog, I have low overhead. I have slowly been bringing my prices up, as I probably have not been covering my true expenses. Also, as a newer start-up if I can absorb "just getting by" on some jobs that will earn some credibality, that is like advertising to me - there is still a cost to this advertising, just doesn't show up as well in the books.

 

[ATH]

Do you use new price(of equipment) to figure out per hour charge ?

There are a lot of ways to approach this. Generally, the customer should be paying the depreciation of the equipment...

I think it depends if you have a loan or not:
If loan, figure outhow much you need to charge to pay that loan, then put some padding into it. The padding should cover maintenance, and start building an account to replace. If you have a 3 year loan and will run the equipment for 5 years, plan on using that last 2 years to earn the $ for replacement.

If you own, I'd figure out how long it will last, then figure out the cost of a new one, and charge enough to pay for the new one right before you need it (plus a cushion to maintain the one you have).

Of course, this is the actual cost of the equipment. Don't forget to include operating labor.

 

[hornett22]

there is good money to be made in CT.

the key to getting jobs is not always being the lowest price.you have to sell yourself ,your skill,and your services.my partner used to freak out when we lost a job to someone else,i do not.i learned in the landscaping business long ago to bid accordingly.there is plenty of competition out there and you will not always get the jobs you bid and you will not always lose jobs because of being more expensive.

i have seen guys underbid a job and then comeback and ask the homeowner for more money.sometimes it happened,sometimes not.in CT i wouldn't count on it.

i told my partner not to give prices when he sees a job until i see it.he doesn't listen to well and he feels sorry for them.you can do this sometimes but not very often.they will rarely if ever feel sorry for you.this just happened today.he told someone a price and i went and looked at it tonight,my price is $1500 dollars more.he can do it for his price but i will not be on the job. he still sees dollar signs instead of time and labor factors.he is young and i hope he will learn.you have to look at a job long term and always expect anything such as equipment breaking,guys not showing up,weather,needing more equipment,the town or a neighbor getting involved,etc.if you want to make a profit,you have to put money IN YOUR POCKET! after everything else.

MY FREE TRUCK IS ALWAYS IN THE SHOP!

 

[Ed Roland]

I bid @ $65 hour. I make $.

 

[MonkeyDo]

I agree wholey with wood weasel. Choose an hourly. Granted you take all of alot of the above into consid. ... but ... if you're not in the lower end, you probably won't get the yob. If you can't make the hourly that you have decided upon ... you don't need the yob.
My 2

 

[Brush Hog]

Thanks for all the input and idea's. That's what I like about this site you can post a question and get some really good point of views from people who have been doing this for a long time.

Hornett, I used give a break to some people but quickly separated emotions from work. IT DOESN"T PAY THE BILLS and Mr. nice guy gets taken advantage of. NO MORE!!!!!

Entering a new venture/add on service is always nerve racking for me until I get it figured out. That's why I'm sporting the Kojak look

Thanks again everyone
Pete

 

[arboristman]

I bid @ $65 hour. I make $.

wow thats seems low.
especially being isa certified also.
what state are you in?
i'm sure you know better than i for whats right for the area,just wondering.
i'm surprised to hear 65$ hr
isa certified ma.
is that for the state of mass?
if so i'm even MORE shocked it would be that low.
are you just starting out?
no offense,you just got me very curious is all.

 

[ATH]

when you bid hourly, do you just tell the client that you are bidding per hour then price it accordingly when you are done? Or do you estimate in your mind how many hours a job will take then multiply that times your rate to give your final number to a client as the bid?

 

[Ed Roland]

wow thats seems low.
especially being isa certified also.
what state are you in?
i'm sure you know better than i for whats right for the area,just wondering.
i'm surprised to hear 65$ hr
isa certified ma.
is that for the state of mass?
if so i'm even MORE shocked it would be that low.
are you just starting out?
no offense,you just got me very curious is all.

Now, I am the curious one. You charge something radically different?? I am within the range of the $50-$100 an hour rate charged by MOST arborist. What are you bidding @?? And, of course, no offense taken. For the record I've been around as a consulting/climbing arborist for some time now. I charge a premium for pest/pathology consults, hazard tree assessments, as well as pruning/removal. I work in South Carolina.