Hi all,
So since dipping my toe in to some larger grounds maintenance/commercial work a month ago or so and buying a ride on mower. I've gone and picked up another 3 larger sites in addition to my first development, so I can make more use of the zero turn on.
What I'm interested to know from others in the trade, do you find the commercial stuff is reliable? Lots of my residential customers I've been with for many years and have great relationships with. Obviously commercial is different and perhaps less loyal? Do you find the turnover of sites is higher and you're having to find replacement work because of change in budgets or circumstances?.
I think I want to keep my diary diverse and keep a mix of residential and commercial/grounds maintenance, in a hope to be able to adjust quickly to changes in the market. I know if there is a financial squeeze my residential stuff will keep going much longer as it's more personal. But with my 4 new commercial sites averaging £70ph that's double what my residential pay.
Who's running 100% commercial and is it a complete pain in the backside?
Thanks
Tim
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Tim, we are 98% commercial, and have been for 30 years plus. When I started in the trade 40 years ago I soon realised that, yes you can make a living from residential but there is a limit to how many customers you can visit in a day/week along with what a residential customer will be prepared to pay so this will never result in big money.
We charge a flat rate over 12 months, so have a positive cashflow all year, it also helps to increase our chargeable rates as the clients tend to focus on cost per month rather than the annual cost, our commercial customers expect a flat rate and although we have converted the majority of residential clients onto the same system it's not an easy sell.
As to your last question, we find residential a pain and commercial generally pain free.
There are of course drawbacks with commercial, if you lose one it's a big financial hit. But that has to be wayed up against the money you have earned which will be far in excess of what would have been earn't in the same time spent on residential work.
Payment can be an issue but we always credit check new commercial work and make our payment terms clear. Over the last 2 years all new work we pick up we have changed our payment terms to 14 days rather than the industry standard of 30. Yes we have had to take legal action on 4 occasions but spread over 40 years it's the exception .
Would we go back to primarily residential? No! The commercial work is far more lucrative and generally grief free.
Thanks for your insight Peter.
The commercial certainly seems a lot more lucrative. Yes the cashflow side of things is good, although to be honest I stay busy all year around and only have myself to worry about on a regular basis. 2 of my sites are on a yearly cost that's split in to 12 monthly payments and it's definitely going to be nice during the winter when I'm doing let hours there but getting good cash flow from them. It also means I've got time to put in to other work while we have shorter days but not feeling the reduction in earnings.
When I set up as self employed after working on a large estate using commercial machinery in an environment which was defined as commercial and working at commercial pace earning a good salary I found residential work just did not resonate .
As Peter mentions above there was just too much grief and I was earning less than I did as an employee and having to work harder , I think the term is"" busy fool "' .
I thought personally I was clueless and having set backs ,runs of bad luck finding awkward customers and it took a long time to see the light
The commercial opportunities which came my way varied from ad-hoc litter picking ,residential complex's , grounds maintenance, business premises
You have to be prepared to make an investment as you have done with your zero turn machine or perhaps take on staff .
It sounds to me from reading your posts that you are in alignment and see the light , commercial is looking like the way forward for you .
For me I did resonate with commercial opportunities but I did not want to commit financially or take on staff as not responsible enough when stress sets in .
I did give them a go on a trial basis and immediately felt the benefits and my work was described as excellent but without investment and staff the work would have being overwhelming .
I was never able to return to suburban residential where people were territorial over parking places and neighbours precious about who cuts which side of the hedge and all the other petty stuff working for customers for whom a gardener is a grudge buy and have short arms and long pockets .
I found a compromise in building up a niche client base which is another option to consider .
Without doubt, if you have specialist kit (zero turn mower) it differentiates you from a man with an ordinary mower.
Personally I found that sort of work too boring, though it paid well, so I had about 30% commercial to 70% residential.
Unless you mess up it should be just as loyal as residential.
I think it would be easier to expand a commercial firm, whereas residential was more based around personalities.
Adam I understand where your coming from in terms of getting bored. I really enjoy my design and planting. And actually I can make some serious money on the one off planting jobs that I fit in around my maintenance work. But they are not regular like the maintenance l, just nice when you get an enquiry.
With all that said, I'm also quite at home on a zero turn and shutting the world off for a couple of hours. I guess if your doing a job well then you should be ok with commercial. Perhaps until you get a change of management or something and they decide they want to try and cut costs. That's when doing the job well will really pay for itself and they might not want to loose a good contractor.
Yep.. I found that (just as residential) there were clients that just saw the green space as a cost, and others who wanted to show off their factory unit - one spent more on lawn treatments and scarification, re-seeding and even top dressings than any of my residential clients - and were very willing to pay for all that work.
The other thing that really put me off was the stuff the strimmer would come across - used sanitary products and the like (yuck)
I wasnt tooled up with a zero turn, so 2 of us yomped through the commercial stuff with 2 big mowers.
I've 10 "commercial" job .............. most quite small but one larger one worth about £8k a year. The rest are about 30 domestic ones. Nice to have a steady income with the commercial stuff but prefer the domestic ones really. You get to know the customers on a personal level..... have a chat and a cup of coffee..... they become almost like friends which makes it quite enjoyable. I'm in a fortunate position though where I'm not desperate for the money and I do the work because I want to ... not have to! My missus reckons I'm very lucky to have a "hobby" that actually pays good money.
ditto... :)
I retired in 2021 and managed to sell the business , and have now taken on 2 clients (may take on 1 more) - all people I like, all with loads of money so we can do nice things rather than just mow and go - also both know I am retired first, and their gardener second.... so for instance this morning 2 years ago I would have found things to do, but really anything I may have found will last till Jan.... so I've canned it and letting the wind and drizzle do its stuff
We have about 50: 50. I would say overall the commercial sites are less hassle: although multi-occupancy sites can be interesting, with everyone weanting things done their way. In that situation you have to have one point of contact you can refer them back to. I would say turnover is similar- the trick is not to have one site that forms too big a part of your round, or it can really hurt when you lose it!
I have a mix of commercial and domestic, although mostly commercial. But then commercial work varies a great deal anyway. A churchyard is a very different animal to mowing a larger job for the 'large country estate' i do work for. But again, the work I do for the 'large country estate' varies greatly also. There are large open areas of mowing and then when their properties become vacant there are ‘domestic’ lawns to mow, some small, some very large. One commercial client, in this case the 'large country estate', but a great variance in the work, a small hand mowing job here and an acre of grass there.
I have found that the ‘commercial’ clients are just as friendly and loyal as the domestic ones. The advantage of the commercial work is that you can just turn up, do the job and then leave. No socializing, no tea drinking and talking for an hour. Now of course, I really enjoy the social side of the work with some clients becoming real friends, sometimes going in for lunch, but it’s a balance. I can’t afford to be doing this all the time, the days just aren’t long enough.
I find that the domestic pays nearly as well as the commercial in terms of how long the job takes for the fee involved, but that’s not the whole story. So for example I have one particular domestic lawn, a small bungalow, which take about 30 minutes and the fee is £35. But by the time I have drunk the tea whist chatting and travelled there and back [only a short distance to and from another job], I have lost an hour. Whereas one commercial job is 40 minutes on site and with travel is one hour and the fee is £100.
On the face of it the lawn at the bungalow is returning £70p/h [£35 for 30 minutes work], but in reality this isn’t the case. Whereas another job at a large company on a commercial estate which takes 90 minutes is £130 and with no time spent socializing.
In reality it comes down to the scale of the job rather than the type of client. I have one domestic client with a very large lawn, it’s a 90 minute job and is £100. The time then spent with a quick chat and tea is far less invasive than three £35 jobs with three chats, three teas and three lots of travel and unloading and re-loading.
This is where the larger scale work really pays off. One site, one client and a fee that may be worth several small domestic sites.