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||10-31-2007 04:04 PM
I am not beating up on anyone in particular with this message. *It is intended for everyone and it is something that needs to be said.
I've noticed something over the last couple weeks on the boards. *New lawn care business owners are really in the dark about how to bid jobs. *They are coming in here asking people with more experience how much to bid on particular jobs. *This is a recipe for disaster. *There are people here who are bidding huge jobs without an understanding of the costs at hand. *
Every job is different for every LCO. *A large LCO might be able to do a job for half the price you can do it because they already have the equipment and the employees ready to go. *That doesn't mean you should cut your price. *It just means that you should find jobs that fit into your skillset so you can compete profitably. *No one on these boards knows what your particular costs or abilities are. *We might be able to tell you what we would bid but we can never tell you what you should bid. *I have never told anyone a specific amount on any job and I never will for this very reason.
You don't need to know "how much" to bid on a job. *Instead, you need to know "how" to bid a job. *
People are asking about bid amounts without an understanding of the costs involved. *You must bid with an understanding of expenses (gas, equipment depreciation, general business expenses, advertising, oil changes, blade sharpening, travel expenses, breakdowns, etc.). *PLUS, you have business taxes (quarterly filings), employee taxes, insurance, overhead, and on and on. * If you are bidding jobs and not thinking about your total costs, I think you are in for a world of hurt. *Remind me to tell you about the guy who UNDERBID me more than $30,000 on a maintenance contract once. *Within about 6 months he had gone broke and backed out of the contract. *He had no clue what his expenses would be.
It's 30 bucks for the whole package. *The Gopher Team has seen it and I think they can attest to the worth of the materials. *In addition to a ton of other business tools, it will help teach you the HOWs and WHYs of bidding jobs. *Without full mastery of these skills you will never live up to your full potential.
It would break my heart to see someone come in here and grossly under bid a job because they didn't have an understanding of the process. *Knowledge is Power.
Thanks for listening:
||10-31-2007 05:19 PM
Great Post Keith. I agree with you.
||10-31-2007 09:17 PM
Originally Posted by [b
Quote[/b] ]If you are bidding jobs and not thinking about your total costs, I think you are in for a world of hurt. Remind me to tell you about the guy who UNDERBID me more than $30,000 on a maintenance contract once. Within about 6 months he had gone broke and backed out of the contract. He had no clue what his expenses would be.
Thanks for posting Keith. I agree, if you bid on a job outside your scope to perform it, you are asking for bid problems.
Could you tell us the story about the person who underbid you?
This could open a lot of eyes!
||11-01-2007 12:47 PM
Despite my Nutrageous and Snickers hangover from last night's Halloween party, I'll relate the story.
This was a contract I had during the mid and late 90's. It was one of those government mowing contracts with very precise bidding requirments. The screening process was pretty intense. Luckily, I gave the best bid (best does not always mean lowest).
I kept the contract for a number of years. The cool thing about contracts such as this is that, if they like you, they will throw more work your way without you having to bid for the extra work. Everytime the bid came around, it was for the original amount of work and then the extra work was just added on top of the original amount. The extra work effectively doubled the amount of money paid.
Then, one year, they decided to add all the additional work into the contract plus a few other properties. That year, this guy decided to bid the contract. All he did was take my original amount that I bid on the first year and lowballed that bid by $1000.
I'm not sure he even read the contract to see all the extra work that was included.
If you bid 'em right, contracts like this can explode your profits but if you bid 'em wrong, they can wreck your business.
Read the fine print:
||11-01-2007 05:46 PM
Very informative, Keith. You know, as a new LCO, I don't think I could make it without this forum. I do intend to get your material too. I think ANYTHING is worth the time to read... even if you already know everything the material has to say. But this forum, when used properly, can be a VERY valuable tool as well. Take what is said in these forums with a grain of salt. Some folks have huge operations, some small... but they all have a little bit of wisdom to share.
Just my 2 cents worth.
||11-01-2007 06:45 PM
I Bought Keith's complete package today can not wait to get it, I will be posting about it soon as I get it and read it,
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