i need advice on bidding jobs

Maui Palm & Tree Care

Maui Palm & Tree Care

Location
Pukalani, Hawaii
call me an idiot if this sounds too low here but i have allways charged $75 an hour for work. it's just me and a groundie doing most of the work. i pay him $10 an hour to feed the chipper and haul the wood. my question is, is that too low a price and if so i could use some friendly advice on bidding bigger tree's that need climbing and rigging thanks.
 
If you are a legally operating with the proper liability and workers comp insurance class codes, you pay your help on the books and are conscientious about crew safety, and have the required state licensing. Then yes. It seems way too cheap. But that may be your local market. Rates vary from region to region. If you seem to get every job you bid and are getting behind schedule you are likely too cheap. Print up copies of a current insurance cert and license, hand them out with each proposal and shoot for a higher man hour rate. Say $50 for starters. Test the waters with higher rates if you get alot of work at 50 a man. Good luck.
 
If you get every job that you bid, it is too little. If you are getting most jobs, then likely it is below market value.

I was just remember a job when I first started out. I had one climbing saw and one MS 361 to do the rest. When I was blocking down the spars in double and triple firewood lengths, the groundman could only move the large rounds out of the way, barely, then he would wait for the next one. High efficiency was not present due to skill building and equipment shortage. Therefore, productivity was not as high, therefore, while I was too cheap by the job, our hourly production maybe was somewhere around what you are talking about. This was legally operating, BTW.

Three years later, I have two climbing saws and four ground saws. Rather than an completely inexperienced ground crew, my employee(s) get thoroughly trained, and I try to hire multipurpose crew members rather than a groundie only, even if he predominantly does ground work.

You would be better to get a lesser percentage of your jobs, made up for with higher profit margin. Even if you make a little less money, it will be less wear and tear on your body and equipment, and you will be able to put in that little bit more to each job that will help your reputation.

Make sure you are giving out business cards like water, and ask for written references if you can get them, take photos of before and after, and put them all in your bidding binder with your insurance paperwork.

You don't want to be the cheap guy.

You want to set yourself up as a good value, and reliable. In time, you will get the second round of work from customers, in a year to many years of being in business. You will want your repeat customers to be looking for value over cheapness, and their referrals to expect not to pay the least, but to get a good value for quality.

The hard part is determining market value, which changes all the time, IMO.

Best of luck. Scratch that. Best of hard work, dedication, blood, sweat, and tears, reading all the archives of the business management forum for the last seven (or is it 8 now) years, asking questions, and if you can sneak in a college business class here and there, it will help.

How long in business?
 
Your prices may be too low, especially with the higher costs of living associated with Hawaii. I imagine that shipping for parts, oil, fuel, chippers, trucks, saws, etc, drive up the prices of everything.
 
yeah i guess it is pretty cheap but i have only been doing it for a year now and am ready to make some changes. im moving up in work quality and efficiency. i feel im working more to make the same amount of profit as others do in one job.thanks for all that info. if any of you make it out to hawaii i'll buy you a drink! mahalo/thank you in hawaiian
 
in some respects "too low" and "too high" are irrelevant until you have figured your cost accounting.

The best way to determine what you need to charge is to apportion your annualized expenses against your annualized man-hours. then you know what you must charge to break even. Those expenses must include your salary as well otherwise it is moot.

once you have your "break even" hourly rate add the profit percentage (the part necessary to build the company) and you have your working hourly rate (per man hour)

Now, if you can sell better than 50% of your jobs at that rate you are doing good...even if you sell 100% you are not necessarily too low as you are paying the bills and then some!

On the the other hand, at that man-hour rate if you cannot sell more than 20% of your jobs you many have to find out where you can trim costs to bring the hourly down. But again, if you are selling enough to meet the minimum hours you need, the price may be just right.

Point is you need to know how many hours you have available for work, how many hours you will need to fill and what your costs are to properly determine your hourly rate.

for us I know that I can "sell" and fill our schedule all day long at $115/hour for our crew. I also know I can't sell a thing at $147 per hour for the crew.

Consequently I needed to examine our expenses and get them down so I could sell within our market's range.

Hope this makes some sense but it is probably as clear as mud!
 
[ QUOTE ]
If you get every job that you bid, it is too little. If you are getting most jobs, then likely it is below market value.

I was just remember a job when I first started out. I had one climbing saw and one MS 361 to do the rest. When I was blocking down the spars in double and triple firewood lengths, the groundman could only move the large rounds out of the way, barely, then he would wait for the next one. High efficiency was not present due to skill building and equipment shortage. Therefore, productivity was not as high, therefore, while I was too cheap by the job, our hourly production maybe was somewhere around what you are talking about. This was legally operating, BTW.

Three years later, I have two climbing saws and four ground saws. Rather than an completely inexperienced ground crew, my employee(s) get thoroughly trained, and I try to hire multipurpose crew members rather than a groundie only, even if he predominantly does ground work.

You would be better to get a lesser percentage of your jobs, made up for with higher profit margin. Even if you make a little less money, it will be less wear and tear on your body and equipment, and you will be able to put in that little bit more to each job that will help your reputation.

Make sure you are giving out business cards like water, and ask for written references if you can get them, take photos of before and after, and put them all in your bidding binder with your insurance paperwork.

You don't want to be the cheap guy.

You want to set yourself up as a good value, and reliable. In time, you will get the second round of work from customers, in a year to many years of being in business. You will want your repeat customers to be looking for value over cheapness, and their referrals to expect not to pay the least, but to get a good value for quality.

The hard part is determining market value, which changes all the time, IMO.

Best of luck. Scratch that. Best of hard work, dedication, blood, sweat, and tears, reading all the archives of the business management forum for the last seven (or is it 8 now) years, asking questions, and if you can sneak in a college business class here and there, it will help.

How long in business?

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The very most important thing that Sean said was value. Always try too promote yourself as the best value around and you will never be expected to provide the very lowest price, just the best job for a reasonable rate.
 
Do you have a specific client type you target? Where do you want to fit in your market? Are you the lowest cost provider or the value-added high end company? Know the market rates for the work being done for the specific clientele you target. Then set your price to reflect that. Make sure your costs are inline with your prices as suggested above.


Decide where you want to be and drive toward that.
 
well first off. im not stingy when it comes to making money. i love this job and would rather make just enough for comfort and have happy repeat clients then making a buncha money all in one job and then sit and wait around for the next one becuae your too expensive. i like to show up to the site with a smile and respect the property owner even if they are on the mean side of things. but again id rather build a good list of clients who hire me because i do a good job, im verry clean, nice to people, safe, and most importantly does what needs to be done on time.
 
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well first off. im not stingy when it comes to making money. i love this job and would rather make just enough for comfort and have happy repeat clients then making a buncha money all in one job and then sit and wait around for the next one becuae your too expensive. i like to show up to the site with a smile and respect the property owner even if they are on the mean side of things. but again id rather build a good list of clients who hire me because i do a good job, im verry clean, nice to people, safe, and most importantly does what needs to be done on time.

[/ QUOTE ]

This is good.

I think that the best customer base for you will be the people that have enough money to pay you as a professional, and appreciate the good service enough to refer you to their friends/ coworkers/ family/ neighbors.

Your pricing doesn't SOUND like it will be sustainable if you want to buy better equipment that will allow you to do less physical work prolonging your ability to do this work, attend training/ send your employee for training/ educational endeavors, take a paid vacation, put money into a retirement account, etc. What is your take? Do you make enough for these things? Do you deserve these things as you build your business? What is the cost of living like there? What does it cost to get an electrician or plumber to come to your house for an hour in Hawaii?


Doing a great job for a fair (to you and customer) dependably and puntually is all someone can ask for, reasonably. If you can do this you will make them happy and build a good base of people that are more recession-proof than people that want cheap prices. Sometimes, maybe often times, good customers don't want the low bidder, or the high bidder. The middle bidder sometimes is the best value.

I have a repeat customer that got yelled at by the low bidder when she criticized the work as poor. Then the fence contractor's son cut into his finger with the circular saw. Their truck was not ready to drive out in an emergency, so she had to drive the bleeding kid to the emergency room in her own car. While you Might be the low bid, this is not a reflection on you, but in the customer's mind, they might take low bid as corner cutter, unsafe, sketchy, whatever, unless you get the job and opportunity to show otherwise.

People that have more disposable income May be more likely to stay loyal to great service at a fair/ higher price than the bargain shoppers. Sure you will get repeat customers from the better-heeled crowd, but still with a slim margin, unless you are operating on a super-low overhead (unless you aren't capturing all your costs, such as your hourly wage separate from your company profit). Some people recognize that frequently you only get what you pay for.




What type of equipment are you using for disposal? Is it all paid for? Is there a fund started for replacement in time?

Try bumping up the price a bit, and be sure your sales game is on, explaining how you are worth your price and will be giving them x, y, and z, and how you are a better value than your competitors.

How is the competition for tree work over in Hawaii? What quality is it? Can they do what you do, and vice-versa.

Good luck Joshuatrees.
 
Forget about pricing first and think about the service level and quality of the work you want to do. Professional development will allow you to keep abreast of things and deliver the best to your clients. Understanding what your clients value and what the market delivers for the money will lead you to your price.
 
well first off we dont have alot of arborist's here who do quality work. most people here "top" tree's and make verry bad pruning cuts. i think the tree companies here top them becuase there isn't much tree's in the central part of maui to begin with and from what i know, when you top a tree,(if it lives) will grow back a huge new flush of growth and will continue to do so for years and years to come. thats what alot of these guys here do. now im not pointing fingers but i wanna offer proper ISA standard work. and make sure people understand what quality work is. i think i need advice on how to tell people that im different then one of these tree topping bucket truck companies. it seems everyone here with a bucket truck tops tree's and the few climbers we have understand that topping = bad, reduction pruning = good. alot of people here dont really know the difference and sometimes dont take me seriously because im only 21 and i know i cant fix my age issue. what advice would you give me to say to my customer that will make me stand out more in their minds over some big name company with bucket trucks???(no offence to bucket truck users intended if your pruning methods are ISA approved, still lazy though lol).
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picture speaks a thousand words.

Good and bad pruning pictures, decay pictures, ISA anti-topping brochures, ISA care for mature trees brochures, insect problems in conjunction with poor pruning, tree failures of stressed trees, common tree defects (e.g. included bark crotches, stem girdling roots, etc.).


I suggest making bidding binder with this info in easy reach.

Speak professionally, Yes not ya, You may know/ Do you know instead of Y'know, etc.

Record some of your sales calls and replay to evaluate.

Ask you customers for written references that you can have in your binder. Add this to your insurance certificates, get some professional credentials.

Dress in a professional way. Not a suit and tie, but clean tree work clothes (Arborwear or other work pants/ shorts, hi-vis shirt maybe), or polo shirt, or your tree company shirt (you can get one free from Vistaprint.com, plus shipping and handling). Be early to your sales calls, or punctual.
 
Be professional but don't go overboard, this is Hawaii brah
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There seems to be a fine line between selling work really cheap and getting a lot of jobs and selling it too high and waiting for the phone to ring. Perception is reality for most of us so people equate paying more with higher quality as long as you can talk the talk and walk the walk.
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jp
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sticking my nose where it douse not belong, but Maui is expensive and unless your living on the beech 10 an hour is rough. One can make ten an hour behind a weed eater or any general labor. bump that up to 80 and give your groundie a few more clams. If he is not worth it find you one that is. you will get more done at the end of the day anyway.
 
Image is important. Be sure your crew shows up in uniform, clean as can be, PPE, etc. Trucks in great shape, with proper company logo and lettering.

Don't just tell them topping is bad, reduction pruning is good. Explain, in sales the are called FAB statements. Feature, Advantage, Benefit. e.g., Proper ISA standards of pruning leads to structural integrity of the tree which means the value of the trees both aesthetically and financially will be retained over the life of the tree and your home.


Yesterday, my client was complaining that he was made to retain six mature trees on his property even though he was going to plant more. I explained advantage of keeping the larger mature trees while underplanting new as a way of providing a better environment for the new trees to grow and eventually replace the more mature trees in the long term. He then understood this and thought it was a good idea. Take the time to show the clients the benefits of your work and they will then see you as a professional wise beyond your years.
 
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Speak professionally, Yes not ya, You may know/ Do you know instead of Y'know, etc.



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I say this working with the idea that some of the better customers, in the sense of more disposable income, more investment in landscape, greater likelihood of paying more for better service, etc, are more likely professionals/ career people that are used to people speaking a bit more formally than an average (or could be above average) 21 year old.

I believe that customers are more likely to go with one contractor over another, all else being equal, if they relate to the contractor, be it parenthood, sports teams, truck they drive.

As well, there are have-to-prove-they're-rich types of people then want not to relate to you. Those folks are best dealt with professionally, IMO, rather than a laid back attitude.

Other people will appreciate laid-back, professional service. I've had a customer burn me a bunch of Dead CDs of live shows from way back. A fine one for Y'know's and Cool's and Right On's.
 
it's a hard habbit to cut off at times. in hawaii everything is soo laid back and most of time, the "richey people" who live here are mostly on vacation so they have a laid back attitude anyway. i think treesandsurf knows what im talking about. (hawaiian style! chee pono!)
 
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