Job estimates are part of our business. Lowball offers and price shoppers also come with the territory. We all want to get the best price for our work, but so does the customer. Making time to give free price quotes is how we keep the business going, right? It cost time and money to give estimates. In areas with steep competition less than half of the estimates given turn into clients.
This question is often raised: Do we charge for estimates to curb expenses or continue to give free estimates? Is there a way to identify the customers who are only interested in a lowball offer before we drive to the house? (Yes there is!) Here are some things to consider!
Free Estimates or Charge for Estimates
It is important to know that a precedent has already been established with lawn care estimates. Most people expect a free estimate for basic lawn care services. You will probably not get many calls if you list that you charge for estimates. On the upside, charging for an estimate will most likely weed out any price shoppers or those who would attempt to counter your price quote with a lowball offer. They simply won't pay for an estimate.
On the other hand, if you are also an arborist giving expert advice on tree care, especially concerning sick or diseased trees, then you may be able to get away with charging for estimates. People will pay for an estimate if they understand you have expertise, knowledge and skills not easily come by. Then, if you deduct the cost of the estimate from the bill if they choose your services, it will often help to seal the deal.
Let's Do the Math on Free Estimates
Let's see why you are better off giving free estimates! It may get a bit confusing so try to follow along carefully.
For this purpose, let's say that every 50 estimates works out to 20 paying customers. That would mean that 30 estimates given gained no return at all, but instead cost you money.
To see how much those 30 estimates cost you, first determine how much an hour of your time is worth, and maybe a gallon of gas, just for the estimate - say $20. $20 times 30 equals $600. So it cost you in time and maybe a little gas approximately $600 in a season, (for smaller companies.) If you charged for estimates some would say that amounts to $600 saved, or at least time given to better use because the 30 customers probably wouldn't have called. Ok, fair enough.
Also equally fair is this question: How many of these 20 paying customers would not have called if they knew you charged for your lawn care estimates? There is no way of telling, but to be safe lets say it would be cut in half. Now it is only 10 customers for every 50 estimates given.
If your average yard estimate is $45 X 17 mowings each year (low estimate on mowings) equals $765. Multiply that number by 10 lawns and it equals $7650. This is what you would receive each year for the 10 customers you would get out of 50 estimates if you charged for the estimates.
Because you didn't charge for estimates, your customer base is doubled and your income for every 50 estimates is now $15,300. Giving free estimates nets you more money each year than if you charged for estimates.
Here is a simple way of identifying those who are only interested in low-balling your price quote.
A simple way of filtering out those people that are not interested in any price except a lowball offer, simply tell the person beforehand that you have a minimum price that you charge. If that minimum price is within their range they may ask you to come out. If not, they will look for someone else.
You will always have those who will not go with your services. You can't avoid it and is a cost of doing business. You should always give free lawn care estimates unless the costs incurred for estimates that do not turn into customers is higher than the clients gained by giving free estimates. It is a guessing game, but you can rest assured that you will lose more potential clients if you charge for estimates.
Did you Know You Almost Always Make More Money with Free Estimates for Lawn Care Services Than By Charging for Estimates?