Powerful Tools To Streamline Your Business & Grow Revenue Part 2
So, did you guess it? What other document do I include when I send out the Lawn Agreement Form?
While asking customers what services they will be looking for in the upcoming season, it’s important to be transparent about what those services will cost. If our customers are opting to renew lawn services with us, we want them to know what that will cost them to avoid any confusion down the line.
I used to be the guy that never raised my prices. Heck, I went 10 years without raising prices and man was that a mistake! Now that I’ve learned my lesson the hard way, I encourage others in the industry to raise their prices at least every other year. Let’s talk about why it’s important to raise prices and what you should consider when increasing them.
When deciding on price increases, there are several factors to consider:
- Inflation
- Cost of Goods
- Cost of Labor
- Wage Increases
Currently, we are still seeing an inflation rate of at least 6%, so think about how that inflation impacts your business. If other prices are rising, so should yours!
Other situations where a Price Adjustment Letter may be needed is when you initially bid a property incorrectly. We’ve all been there; we all have a handful of lawns that we thought would only take 30 minutes that end up taking an hour. It’s okay, it happens... but if you ate the costs the first year because you wanted to maintain the customer relationship, now's the time to increase.
Increases shouldn’t be all that shocking to your customers, but always be prepared for the possibility of a phone call. After I sent out my Price Adjustment Letter, I received several calls, and you know what? In the end, they all understood my reasoning behind the price increase. I am always honest with my customers and explain the reason for the price adjustment. Whether that be due to my initial underbidding, or the overall increase of costs, people generally understand.
More often than not, a customer is understanding of the increase because they'd rather go with the guy they know than the guy they don't. Most people would rather use the service provider they know and have experience with, than one they don't. They know your quality of work, they know you’re reliable, and they know your customer service. It could be a colossal waste of their time and money for them to pursue other options.
Sending Price Adjustment Letters at the same time as the Lawn Agreement Form is a great way to not only get your business organized but to stay on the same page with the customer. I highly encourage you to think about sending out Price Adjustment Letters, and if you’re not sure where to start, I've got you covered! Check out our Price Adjustment Letter at Lawntrepreneur Academy. It is an editable Word Document where you will be able to use the same language I use, and tailor it to your company and your prices. The editable document is accompanied by an instructional video to guide you through the process.
Putting this simple system in place totally transformed by business for the better. I was able to streamline operations and grow my revenue. If you don’t have a system in place to check in with your customers annually, this may be the perfect way to start.
