For those who own and operate a small lawn mowing business, it can be challenging to take your venture to the next level. Expanding into commercial lawn care is a great way to line up steady work, but it’s not always easy. Without an existing network of contacts and clients, it’s hard to get started in commercial lawn mowing.
There’s definitely no shortage of commercial lawn care contracts up for grabs – many establishments have lawns that will need regular mowing year-round. But getting started in commercial mowing is the hardest part: you can’t just walk up to the manager of your local retirement home and ask to mow their lawns. There is a process involved in bidding on commercial contracts and a lot of factors you need to consider.
Whether you are a long-time owner of a lawn mowing company, or somebody new to the industry, understanding the commercial contracting process is essential. We have collated information to help you win more lawn mowing contracts, so continue reading below to find out how.
How Do Commercial Lawn Care Contracts Work?
A commercial lawn care contract is an agreement for regular mowing services between a service provider and another business. Commercial opportunities are more complex and competitive than residential lawn mowing, usually involving a scoping stage, creating a proposal or quote, and then negotiating a contract if the bid is won.
Contracts are usually for a fixed period and are renewed periodically, so finding out when an existing contract runs out can help you time your offer appropriately.
Commercial property owners often don’t have the equipment, the manpower, and the expertise to maintain their gardens properly. As such, they turn to lawn mowing companies to carry out regular maintenance and keep their green areas as neat as possible.
Although this guide focuses on lawn mowing, companies who do this work usually do additional services under the one contract. These include gardening, weeding and fertilising, hedge and tree trimming and pruning, landscaping, garden design, and planting.
Clients usually prefer to hire lawn mowing companies that are flexible with their schedule and cause minimal interruption to their business operations. If it’s hands-off and hassle-free for management, you’ll be ticking their boxes – as long as your quote is competitive, of course.
What Kind of Clients Need Commercial Lawn Care Contracts?
Commercial lawn mowing clients include real estate agents, community services, hotels, restaurants, business and corporate properties, educational institutions, residential communities and body corporate managers.
These clients usually have lawns or gardens with plants and greenery designed to create a nice environment for their customers. As such, having their lawns regularly mowed is a major investment in their brand, and they’ll want a supplier who is completely reliable.
The scale of commercial lawn care jobs can vary a lot, from mowing a cafe’s nature strip to full upkeep and landscaping of a hotel’s grounds. Identifying what type of commercial lawn mowing you’d like to perform (and any additional services you’re prepared to offer) will help you target the best commercial clients. If you’re new to commercial lawn mowing, targeting small locally-owned businesses can help you get started without needing to navigate a high-level bidding process.
Some commercial clients, such as real estate agents, may want to contract someone for maintenance of multiple properties or one-off mowing jobs on demand. Finding out exactly what is required will help you make the best pitch possible, emphasising how your business will satisfy their needs.
What is the Difference Between Residential and Commercial Landscaping?
There are a few key differences between residential and commercial lawn care jobs:
- Scope – Residential yards are almost always smaller than commercial properties. This translates to smaller lawns and fewer plants to maintain. As such, the maintenance of residential properties takes up much less time, while commercial lawn mowing can be an all-day affair. Commercial lawn mowing can include vast acres of land, so quoting and scheduling appropriately is important.
- Billing Methods – The billing process for residential lawn mowing is usually simple: the lawn mowing company charges for a one-time service, paid on delivery. On the other hand, commercial lawn care often involves monthly invoicing. This means commercial contracts provide a more stable and predictable source of income, but setting the correct payment terms in the contract itself is critical.
- Profit Margins – Profit margins for commercial lawn mowing contracts are smaller than those for residential lawns. While the scope of the work is larger, property managers are motivated to find the lowest-cost solution, meaning commercial lawn care quotes are very competitive. While the reliability of a monthly maintenance contract is appealing, operating expenses are equal (or higher) compared to domestic work, so reducing the profit margin is one of the few ways to beat competitor’s bids.
- Equipment – The most noticeable difference between commercial and residential lawn mowing is the type of equipment used. Residential properties can often be maintained with regular domestic lawn mowers, whipper snippers and leaf blowers, for example. However, since commercial projects are much bigger in scale, they require more heavy-duty equipment and tools. This leads to higher equipment costs, fuel requirements and even more manpower needed to get the job done in time.
Are Commercial Lawn Mowing Contracts Worth It?
Whether commercial lawn care contracts are worth taking on depends on the individual business owner and strategy. If you are looking for the best profit margins, then commercial landscaping maintenance may not be the option for you. However, if you have the commercial-grade equipment and are looking for long term, consistent work, commercial landscaping can be rewarding.
The contract includes specifics such as the height to which the grass has to be cut. This makes the client’s expectations very clear, which leaves little room for misunderstanding or mistakes. Ensuring all employees understand exactly what to do is key to success in commercial landscaping.
There are factors to be considered before deciding if commercial landscaping contracts are worth it. To better understand these, we have listed the pros and cons below.
Pros of Commercial Lawn Mowing Contracts:
- Consistent Cash Flow – Commercial projects are generally based on a contract with terms that stipulate a monthly payment. This can be preferable from an income and budgeting perspective, allowing you to predict and plan your financial outlook months in advance.
- Scheduling – One of the biggest advantages of commercial lawn mowing is the predictable schedules. The routine of commercial lawn maintenance is usually the same every week or month, with some seasonal variation. This means your team can learn the routines and manage other weekly bookings around these reserved slots, making your business more predictable and efficient.
- Multi-year Contracts – In the landscaping industry, a majority of the clients are willing to sign multi-year contracts. This means that during seasons with low or no new clients, your business is still guaranteed to make revenue. This makes it easier to grow or maintain the business and enables you to predict your revenue a few years ahead.
- Year-round Work – If you’re looking to generate more winter income as a landscaping maintenance business, you may benefit from having commercial contracts in your portfolio. This is because clients prefer to have one provider locked in for the entire year, regardless of the weather, giving you predictable work even through cold and rainy periods.
- Multiple Projects From One Customer – Property management companies generally have a range of properties they manage. This means that when your business does a great job for one of their properties, the client may ask you to service the others they own. The same can be said for other establishments with multiple branches like restaurants, and there’s always the possibility for referrals in tight-knit industries.
Cons of Commercial Lawn Mowing Contracts:
- Pricing Pressures – The commercial lawn care market is driven by price, and it’s usually a race to the bottom. Businesses compromise on lower and lower profit margins to win a bid or try to renew their current contract. Working in commercial lawn care will not yield the same hourly rate as small-scale and residential projects.
- Unstable Business Relationships – Business relationships in the commercial market are vastly different to residential or small-scale markets. Property managers, HOA board, and facility managers can retire, change, or be fired at any point. This means any long-term contracts could also be jeopardised if there’s a change in management, especially if they have preferred contractors from their previous role.
- Multiple ‘Bosses’ – If you are granted a contract for a retirement village with 150 unit owners, that’s 150 people you need to keep happy! On paper, you’re only accountable to the property manager, of course. However, as a growing business, you don’t want to risk having a resident take an issue with your work or noise. This will never be easy, especially if you’ve accidentally disturbed someone’s afternoon nap with your routine mowing.
- Customer Loyalty – The environment of commercial lawn maintenance is far more complex, and that can make it more unpredictable, despite everyone having signed on the dotted line. For instance, you may do an excellent job with no complaints from the client and still lose the contract when it’s time to renew. This could be anything from a change in management to budget cuts or a competitor’s cut-price offer – and you’ll have to reduce your profit even further to win the contract again.
- Inflexibility – Flexibility can become an issue because you are locked into a contract that may last for years. You are legally bound to complete work for a certain amount of time, even if you are trying to change industries, or the business can no longer be sustained financially.
If you’re looking for steady maintenance work or to grow your lawn mowing business, there are other alternatives to doing commercial lawn care. Working with a good-value lead generation company like Jim’s Plus can provide you with a steady supply of clients, while keeping those ‘premium’ profit margins in place.
How Do I Get Commercial Lawn Care Contracts?
Where to Find Commercial Lawn Mowing Clients in Australia?
If you are looking to gain commercial lawn care contracts, personal networks and relationship-building is the top priority. Talk to your existing residential client network to see if they know any businesses needing landscaping maintenance services. Some commercial contracts are posted online for bids, but many are never advertised openly.
Grounds maintenance opportunities with government and council bodies go through an open tender process, so these vacancies are shared on sites such as AusTender and AustralianTenders. However, government tenders have their own rules and processes distinct even from commercial lawn care. Large commercial organisations may also have a public tender process, but this is the territory of experienced commercial
Tenders are extremely time-consuming to prepare, and government contracts come with a lot of strings attached that can be overwhelming to small businesses.
To get started in the commercial market, it’s best to start by looking for lawn mowing contracts available in your local area. It may be beneficial to talk to your residential client network to see who may know of businesses needing commercial lawn care.
You can also drive around your service area to look for prospective clients. If you notice a nearby business that has a lawn that appears unkempt, it could mean their scheduled lawn mower is coming soon – or they might require a new contractor, a role that you could step up and fill with the right pitch.
Remember that when you are scouting for prospective commercial landscaping accounts, it is best to look for locally-owned properties. These give you the best chance to deal with the owner directly, rather than having to go through several levels of management to get to a decision-maker.
Targeting a specific niche in the lawn care market can also help you establish a reputation for yourself and gain more referrals. Identify the type of business you prefer to service and target your efforts specifically towards that market.
The key to success in the commercial market is to build business relationships, so once you pick up a few clients, doing an exceptional job is sure to get you referrals. Clients will always prefer experienced companies, and those with a reliable reputation.
One way to help your business is by optimising your list of references. For instance, if you’re looking to land a contract with a hotel manager, it would be best to put other hotel managers on your reference list. Don’t be afraid to ask if they know anyone else who might need a regular mowing service, and get them to pass on a business card or your website details.
How Do You Bid on a Mowing Contract?
A commercial mowing client will first ask you to provide a bid for services. This bid should contain the list of landscaping services your business provides as well as the pricing. If you perform general gardening services like hedge trimming as well as mowing, clients can meet all their lawn care needs with the one contractor.
In the lawn care industry, the basic mowing and edging services will be about the same for all businesses, and it’s hard to differentiate based on anything but price. For that reason, it’s a great strategy to emphasise any additional or special services that your business can offer, helping your bid stand out from the rest.
When providing an estimate, be sure to visit the property yourself to inspect it. That way, you can visually gauge the amount of work required, and the client knows you are giving a quote specific to them, not a generic figure. This will also help you understand any unique needs the client has and how to win them over.
You may opt to add a section to your bid that contains references. If you have worked for a previous client who was pleased with the results, ask them if they are willing to take reference calls. This can give new clients confidence in your services, especially if you’re relatively new to commercial work.
A lawn care contract will be drafted once the client has accepted the bid and decides to do business with you. As with any other service business, the contract will ensure that both parties in the agreement receive fair treatment.
Ensure any documents you draw up look clean and professional, and it’s a good idea to have your own legal professional on-side for this part of the process. The contract should cover all aspects of your service including obligations, payment arrangements, contingency plans and termination conditions, as well as any other relevant information.
Commercial Lawn Care Quotes and Estimates
Quotes and estimates for commercial lawn care contracts will need to consider factors such as time, labour, and equipment, among others. There are guidelines to follow when quoting a lawn mowing job, but there are some key differences when it comes to commercial work.
Some of the major considerations when quoting commercial lawn care include:
- Time – Whether you will be working on a multi-property project on a new development or just a maintenance job on a corporate site, knowing how much time to commit to the project is critical. Ensure you’re covering your employees’ wages on large-scale commercial jobs as well as any travel time involved. You may need multiple staff on site each time to cover all the grounds maintenance tasks the client requires – and will you have the time to meet your existing commitments too?
- Labour – When it comes to lawn care, employee or subcontractor labour will be one of your biggest expenses. Also consider your hourly rate as the business owner or operator. With limited profit margins in commercial mowing, you want to make sure you’re compensated for your efforts. If you’ll need to hire staff or contractors to meet the new client’s needs, this can be costly.
- Equipment – The tools used in commercial lawn care contracts are generally much more expensive than those used in small-scale projects. As such, the cost and maintenance of your equipment are a major factor when providing an estimate. If there’s any specialised equipment you’ll need to invest in, make sure you’re factoring in the cost and can cover any finance repayments.
- Competitive Pricing – Like any other industry, it’s important to ensure you’re getting paid what your service is worth. However, there are times when adjusting your prices to be more competitive makes sense. Pay attention to what competitors are quoting and what the property’s previous contracted rate was. If you’ll have to cut your rates too much to win the bid, it may be worth looking at other options.
Legal Issues in Lawn Mowing Contracts
Lawn mowing contracts are binding legal agreements between your lawn mowing business and a client. These contracts should include well-written terms and specific deliverables to avoid legal issues and protect your business. You should always get professional legal advice when drawing up or signing a contract.
Simply put, it doesn’t matter what industry you are in – some things just don’t go as planned. It could be non-payment or late payment for services, or the client could take an issue with the quality or scope of the work you’ve done.
To protect your business, a contract for lawn mowing services should include all relevant information, avoiding legal issues later down the track. This includes things like:
✔ Services to be performed
✔ Work timeframes and deadlines
✔ Payment terms and methods
✔ Notice required for cancellations
✔ Warranties and guarantees
✔ Liability and insurance arrangements
Payment terms are one of the most important features of any lawn care contract – after all, you want to ensure you’re benefiting from the reliable income commercial contracts promise.
It should be clear whether the client is paying weekly, fortnightly, or monthly. Exact prices for each specific service to be performed should be laid out. Other important details include what happens if a check bounces or a payment is missed.
Unless specified clearly, a lawn care business will need to keep performing services even if the invoice goes unpaid or risk breaching the contract themselves. For that reason, it’s important to lay out clear expectations and conditions in the contract itself, so you have legal grounds to stop work if the client doesn’t pay.
Similarly, pay attention to any inclusions on whether a client can withhold payment. If a commercial client takes issue with the length of their grass or the shape of their hedges, there should be a clear dispute resolution procedure – one that doesn’t involve refusing to pay what they agreed upon.
We all know how unpredictable Australian weather can be, which is why it’s a good idea to add a clause for weather conditions. How much notice you would need to cancel or reschedule a regular mowing service could also be placed in this section.
With some careful preparation and diligence, as well as persistence, you can establish a place for your lawn mowing business in the commercial market. If the complexities of the commercial realm just aren’t for you, there are some other great ways to grow your lawn care business.
To learn more about what Jim’s Plus can do for your lawn mowing business, take a look at our resources for service providers.
What Are the Most Profitable Landscaping Services?
While lawn care and gardening service can be very cost-competitive, there are some ‘value added’ services that offer greater profit margins than others.
These more profitable add-on services include:
- Leaf blowing and leaf removal
- Lawn aeration and overseeding
- Fertilisation and weed control
- Garden pest control
- Tree planting
- Power washing decks, gutters, and driveways
Disclaimer: This article is published in good faith and for general informational purposes only. Jim’s Plus does not make any warranties about the ongoing completeness and reliability of this information. It does not constitute financial or legal advice, and you should always consult a professional advisor on these matters.