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  • #16
    OH WOW! I am sorry about that happening! Can you tell us a little about it. What kind of job it was and how they initially found you? Looking back now, what lessons do you feel you learned from the experience so you never repeated that situation again? I bet you have a lot of advise from this as to what others need to look out for before they start a job.
    I started my lawn maintenance business in 2003 with about 20 clients. The next year I began mowing a lawn for a guy that worked for an investment company. Eventually he asked me if I could mow the lawn at their office. It was huge and I had to buy a new mower because at the time I only had push mowers. I would talk with him as I picked up my money and he would mention that company he worked for owned lots of properties. Eventually I asked if I could mow the lawns at these properties. It was amazing, I just started out in business and all I had to do was ask for the business and a week later, I had over 100 properties. The company continuously bought new properties. At one point in 2004 the company wrote me a bad check. They told me to wait a few weeks and they would get me the money... I was paid in full. The next year they had around 250 properties that I maintained. I received 3 bad checks in August and same as the year before, they said to wait a bit and I will get paid. I continued to mow their lawns until the season was over in November. I called and called, I had no returned phone call. I went to their offices (they had a few by this time) and papers were scattered throughout the rooms. I found out they were indicted by the federal government for many fraudulent things. The guy that I initially got the job from was persuaded by his lawyer to not take any calls even from me. The grand total was around $21,000 owed to me for 3 months of hard labor. Before all of this happened I bought a house, new truck and had other credit lines out at the time. Not getting this payment put me in debt for 4 years. I am finally out of the debt, however, I can't purchase much with my credit. I couldn't even buy a tv on credit a week ago, I had to purchase it out right. Although I have splurged a little the past few weeks, I have learned to be very conscious of my spending and I always have a certain amount of money saved at all times. I will never get into debt again, it was the worst thing that has ever happened to me. I am also very hesitant to expand until I have more than enough money saved up and have all of the equipment needed. I work alone and have everything I need and am quite content at the moment. I also try to not let a customer get more than a month behind on payments, but I have my mom (my secretary) in charge of customer payments etc. and unfortunately one or two slip by every year for about 2 months. Sorry for the rambling it is a heated situation for me.

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    • #17
      I am glad you shared it because I think it shines a spotlight on this potential problem others could face.

      What is your view now on the lesson learned from that?

      Is it important to not have one customer make up too much of the % of your income? Or is that not so much an issue as other issues should be?
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      • #18
        I am glad you shared it because I think it shines a spotlight on this potential problem others could face.

        What is your view now on the lesson learned from that?

        Is it important to not have one customer make up too much of the % of your income? Or is that not so much an issue as other issues should be?
        Luckily I had about 35 customers of my own on top of the investment company so I had something to fall back on the next year but drought hit that year so income was down drastically and I didn't have money for advertising and I was out money from the accident on the highway which I never collected from. Also, I had some equipment stolen; about $1500 worth which I had to replace. The following year I borrowed money from a family member and had door hangers made (which were a horrible idea and produced no income) I played on an indoor soccer team and we named the team Larson Lawn Care and I ended up getting a customer out of it and he told me he saw my door hanger at his house. So maybe it did a bit of branding if anything. But I also put an ad in the yellow pages which took off more than I imagined. I ended up with 90+ customers that year that I handled on my own. The next year I weeded out the ones I didn't want and ended up with about 70-80 customers then down to 65-70 to date. I will never rely on a large chunk of income from one person/company, I will always have a back up plan. It is not fair that the law is not really on our side when it comes to collecting. Like someone mentioned earlier, someone steals something from the store, and they get arrested, but if someone steals from a contractor... we are on our own to collect. The owner of the investment company is in jail for mail fraud I believe and I was on the list of about 20 others to persecute him... but again, it will be up to me to collect and there is no way he will pay me when he owes millions. Sorry to hijack the thread. You can read about the investment company that screwed me out of money if you google DHP Investments and/or Doug Hartman. There is a lot of stuff about it and it is interesting to read.

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        • #19
          I will never rely on a large chunk of income from one person/company, I will always have a back up plan.
          Something else we rarely talk about on here is having an emergency fund stashed away. Do you think it is important to have one? How many months of income should be in such a fund?

          Is this what you mean by a back up plan or do you mean something else?
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          • #20
            Something else we rarely talk about on here is having an emergency fund stashed away. Do you think it is important to have one? How many months of income should be in such a fund?

            Is this what you mean by a back up plan or do you mean something else?
            You should always have at least 6 months to a year of "emergency fund" stashed away.

            By back up plan I meant I will be prepared if my income is or will be effected. But I have a back up plan for just about everything.

            I will be ready to get new customers and add new services if something were to happen like a drought, I have other services ready to be offered like garden maintenance, shrub trimming, and something that I haven't done yet... building vegetable gardens. If I got hurt, I'm ready to have someone take over/help with the labor; I have a system of operations plan developed both labor and secretarial. If my truck breaks down, my friend is overseas and his truck is ready if I need it. If my equipment breaks down, I have equipment ready to back-up my main equip. If software fails and data is lost, I have hard copies of everything. I have a back up plan for just about everything now.

            That incident cost me 4 years of my life. I struggled to eat and keep utilities on during the winter months. I had to eat a lot of ramen noodles and tostinos pizza's. There were times that I had to take cold showers in the winter time because my gas was cut off... not fun. I eventually had 7 other people living with me to help pay the bills. It sure feels good to be out of that mess but I am much much stronger because of it.

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            • #21
              You have been through a very difficult situation that I feel most people never even think about.

              As you have your backup plans in place, what say top 5 or top 10 issues do you feel most business owners simply don't plan for?

              Which problems do you feel they could quickly avert if only they had a plan in place for themselves?

              And why do you feel most business owners don't plan for worst case scenarios?
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              • #22
                You have been through a very difficult situation that I feel most people never even think about.

                As you have your backup plans in place, what say top 5 or top 10 issues do you feel most business owners simply don't plan for?

                Which problems do you feel they could quickly avert if only they had a plan in place for themselves?

                And why do you feel most business owners don't plan for worst case scenarios?
                This is a shot in the dark, but issues small LCO's may not plan for are:

                -Drought: It is good to have money stored away for situations where your expected income may be affected.

                -Unexpected expenses: Again, you need money saved to compensate for an unexpected vehicle break down, equip repairs etc. For the past few years, I have had customers pre-pay for the season. This helps very much with unexpected expenses and other financial situations.

                -Gas prices: I'm sure many have become much better at this but charging the customer accordingly in case gas prices go back up to an insane price. Or simply telling the customer that in the event of gas prices going up, likely you will have to add a fuel surcharge to their bill.

                -THEFT: I've had stuff stolen and I'm sure you have too. I've had about $2,500 dollars worth of equipment and tools stolen from me. Now I have an alarm on my truck, locks for everything which stay on at all times when not in use, and an alarm on my garage which houses all of my hard earned equipment.

                -Customer loss: You must plan for customer loss, that way you do your best to keep the customers happy. I try my best to think like the customer and cover all angles. Of course you can't please everyone but you can try if you want to. I make sure to explain everything in detail to my customers through letter form. I let them know my plans for the future as an LCO, and I let them know that I am going to keep them satisfied or do what ever I can to do so. I want them to grow with me as a company and with my customer service, I'm sure they feel like they are.

                -Upselling: Plan to upsell, especially when expected work is effected due to drought, too much rain etc.

                -Plan to answer questions: You have to be knowledgeable in the field you work in. If you don't know the answer to a customers question, you better find it out. I've learned a lot over the past 7 years of lawn maintenance because I would get asked questions by customers, I didn't know the answer so I researched it. Over the past two or so years, I have been able to answer almost every question that I was asked in detail.

                -Too much rain: Some customers don't mind if you leave some mud tracks throughout the lawn, but some do and they will be mad if you mow after a heavy rain. Plan to ask your customers and each new one's what their take is on the situation. I've heard of too many people firing their lawn company because of this.

                Issues with the customers are something you should see coming especially if you have a plan in place for each situation. I try to explain right off the bat, problem situations that could occur. That way if something does happen, they know that you are aware of it. Otherwise, if you didn't tell them in the first place, they may not even tell you and just fire you. I will mention things like: since my mower is so wide and the terrain is uneven, there may be areas where the mower digs into the ground. Eventually, I will learn every area and be able to prevent it. I will ask them their take on too much rain, should I mow or wait a week? If they need me to wait, I'll tell them I will try to get by sooner if possible. I'll tell them I can't prevent all of the grass from getting into the mulched garden areas, but I will try my best to prevent it and I will do my best to get it out of there. I'm sure I can go on with this but the point is, I take problems that other customers have had in the past (which I fixed for them) and I tell every customer I have and every new customer I get these situations so if/when the problem arises, they don't have to call me and complain and they know I will fix it. They will know you are on top of your game and you are serious about what you do.

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                • #23
                  I've gotten pretty good at reading people and knowing if they are responsible, organized, and honest. I have on numerous occasions declined work due to fear of not getting paid. Obviously I don't want to have those customers and I am glad I am able to know or have good assumptions, and feel good about not taking on the work. This is in addition to the things companies may not plan for. Plan to have and notice these personalities in customers and potential customers and don't take on the work. I'm not saying don't take on every customer that portrays these characteristics but be well aware that if some one is unorganized and irresponsible, for example, they have stuff piled up in the backyard, their screen door is hanging on by one hinge, a tree is ready to fall down on the side of the house, just walk away.

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                  • #24
                    I have on numerous occasions declined work due to fear of not getting paid.
                    When you are looking at a property and it is a wreck and the renter/home owner doesn't look like they will be able to pay and you are worried about it, how do you best go about getting yourself out of the situation?

                    Also, do you ever find that yourself asking the potential customer what happened to their previous lawn care provider? Can that at all tell you if they had a problem paying them or not?

                    If you don't know the answer to a customers question, you better find it out.
                    When you are out in the field and you get stumped by a question, how do you suggest telling the customers you just don't know and you will have to get back to them? Is there a way to do it where it is ok?
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                    • #25
                      When you are looking at a property and it is a wreck and the renter/home owner doesn't look like they will be able to pay and you are worried about it, how do you best go about getting yourself out of the situation?

                      Also, do you ever find that yourself asking the potential customer what happened to their previous lawn care provider? Can that at all tell you if they had a problem paying them or not?



                      When you are out in the field and you get stumped by a question, how do you suggest telling the customers you just don't know and you will have to get back to them? Is there a way to do it where it is ok?
                      To get out of a potential bad deal, I will often either tell them that the lawn is in too bad of shape for me to handle (which is usually the case if the person is unorganized) If they do not have a large enough gate for me to get my 61" mower through, I will tell them that my mower won't fit; although I do have a few smaller mowers, time is an issue and if I can't use my most efficient machine, accepting the job could really be a pain especially if you don't end up getting paid. It's not just these particular customers that I won't use a smaller for, if I am in an area where I have a lot of work, I may decline as well. If the job is somewhat out of my route, I will tell them that I it is a bit off route for me and I don't want to end up unreliable for them. I've bid high before to hopefully deter the potentially bad customer. This way, I will make more off of them if they do accept and it could make up for the customer not paying in the future... which in my experience has never failed. Before I didn't think about the customers characteristics but a trend started and after people wouldn't pay each year, I began to see matching characteristics of these people that did not pay their bills.

                      I don't ask who was taking care of their lawn previously, unless I can tell if a professional mower was on the lawn. Then I will ask usually to make sure I don't make the same mistakes as them. However there are things you have to look out for. Of course they won't tell you they didn't pay them. These people will sometimes talk very bad about them, usually cursing them out to me. I'll pry at the situation and determine if they will be a good customer for me. If someone tells me the last lawn company quit on them... this is a sign as well. I will make sure to ask lots of questions. I wish I could do a credit check (although I hate the credit system) and find out how much they have in their bank account, and even find out all of their expenses and monthly income... wouldn't that be wonderful!

                      When a customer asks me a question I do not know the answer to 100%, I will tell them everything I do know about the question asked, I will tell them that I am not an expert in the field, my expertise is with mowing mainly, and I will tell them that I can find the answer out for them. Or I will tell them who they can ask or where they can find the information from.

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                      • #26
                        Then I will ask usually to make sure I don't make the same mistakes as them.
                        This is very interesting too. How do you go about first off, knowing that there may have been previous mistakes another company made and then second off, finding what they are?

                        Do you simply say to the customer, what mistakes have other companies made on your property?

                        We don't talk about this often, but why do you feel it is important to know of the previous mistakes made by other lawn care companies?
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                        • #27
                          This is very interesting too. How do you go about first off, knowing that there may have been previous mistakes another company made and then second off, finding what they are?

                          Do you simply say to the customer, what mistakes have other companies made on your property?

                          We don't talk about this often, but why do you feel it is important to know of the previous mistakes made by other lawn care companies?
                          If they are calling me to give them an estimate, something must have been wrong. So I will ask... "who was taking care of your lawn before?" and usually they will tell me what they didn't like about them. If not, I will ask... "was there something you didn't like about their services.

                          I have to know the previous companies mistakes so I don't make the same ones, or any actually.

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                          • #28
                            That is a very good point. And from the answers they give you, I bet they can really help you figure out if this customer is one that pays or not.
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