[gsdx]

Just trying to figure how much to mark things up from wholesale and how much to charge for planting?

Any Help?

[scott C]

So many variables. Theres lots of good info here about pricing search and you will learn. are u gonna guarantee them.

A nursery I used to work for would plant at double the cost + 60 %.

[Stonehenge]

As Scott C says - run a search on pricing and you'll find a wealth of info. The hard part about just giving pricing info is it's specific to my company (or Scott's company, etc), and my cost structure, business volume and pricing strategy could be world's different than yours - use my pricing and you could either go broke, or not get any work. Or somewhere in between.

Understanding your own costs is a big step to pricing your services.

[gsdx]

Do you mean cost of the plant, or cost of the labor plus 60%. And yes, I am going to guarantee them.
Thanks!

[Bill Schwab]

We do not mark up plants from wholesale prices. We add the cost of delivery, and factor in all labor associated with ordering the plants and recover that in our hourly labor rate. the method to this madness is simple. Our state will require us to collect and pay the difference from what we pay for each item, and send it off to them for the new sale price of the plant. The simple solution was to pass the cost of plant along with the tax we paid directly to the client. Labor in our state is non taxable, so, we just stopped one other layer of ridiculous paper work from occuring.

As far as cost to plant, that varies from each job we do. If we have an entire semi load comming to a job, the cost of setting that job up is absorbed by the cost of labor to plant, and it is pretty insignificant where it relates to the direct labor on that job.

If we have a dump truck load of plants however, the labor to select,telephone, order, examine, and so fourth is higher in percentage than the larger job.

What I am saying is, if a person calls and wants 3 tree installed, the labor for all issues associated with planting that tree get added in. And, if you are one of those using a multipliers when you plant, the plant cost may be 4 times the cost you paid, rather than 3 times in the case of an entire semi load of plants. Each situation has to be calculated specifically if you want to make money. If the person you work for seems to feel what you charge for a small plant job is high, they need to be made aware of all associated costs invloving the project and agree to it, or move on.

In our area, small plant jobs are consumed by the illegal population and we don't get too many of them because those people only charge what wages they would make without paying insurance and or taxes.

[GLAN]

That was nice Bill


I either pass on subjects as this............or


To mark up plants for retail / planting. You have to know what your over head and labor is. Marking up can be anywhere from 2x - 4x the wholesale cost of the plant.

[gsdx]

I understand the importance of pricing on a cost basis, but my concern is to make sure that I strongly consider the importance of the market impact on pricing. Once you have a hold on the cost basis, it is only a goofball that doesn't consider what the market will bare. If my breakeven is a 2x markup (because I have a handle on my expenses.) but my competition is using a 4x markup (Because of overhead or inefficiencies) then I would be silly to only use a 2x markup. This is the reason for my initial question.

(My marketing background and all that...)

Thanks for your replies!

[HardDaysKnight]

I see it as Bill does.
I would mark up plant material if I was selling it as retail.
I extend the wholesale prices to my customers and charge
them for labor and delivery. What I do is figure out how
much all materials cost including GAS and paid deliveries.
Then add the labor cost of the employees based on estimated
time. Then I add a buffer number in case it takes longer
or whatever. Add that all up and decide what I want to net
after it's all said and done.

One important thing: I do not guarentee any plant material
because I am giving them wholesale prices. If anything
stresses and dies....They have the option of paying for
the replacement and the labor to install is FREE! They just
pay the delivery costs. My estimates are always one of
top being considered. Good luck, Johnny

[NCSULandscaper]

container plants i charge 2.5 times the cost, B&B material i charge 3 times the cost for the plant and labor and a 1 year warranty

[HardDaysKnight]

Originally posted by NCSULandscaper
container plants i charge 2.5 times the cost, B&B material i charge 3 times the cost for the plant and labor and a 1 year warranty

Does that mean you fix or replace the damaged parts of
the plant material with your warranty? Hey, just got a kick
out of that. Are you anywhere near Raleigh/Durham?
I'm considering moving from NY to NC but closer to Virginia
Beach. Please PM me if you can help me with some ?s.
Thanks, Johnny

[GLAN]

Originally posted by gsdx
I understand the importance of pricing on a cost basis, but my concern is to make sure that I strongly consider the importance of the market impact on pricing. Once you have a hold on the cost basis, it is only a goofball that doesn't consider what the market will bare. If my breakeven is a 2x markup (because I have a handle on my expenses.) but my competition is using a 4x markup (Because of overhead or inefficiencies) then I would be silly to only use a 2x markup. This is the reason for my initial question.

(My marketing background and all that...)

Thanks for your replies!

OK..........why only break even?

So then by your own explanation 2x markup doesn't cut the mustard......What the market will allow is certainly a viable issue to consider and have knowledge of. Turthfully....That is area specific and also will translate to wholesale cost.

[GLAN]

HDK and Bill.

I bet if we priced plant material.......We would all come pretty close to the same numbers.....Though I do 2x - 4x markup including labor and periferal expenses.

Guarantee...yeah, we provide that for 1 year. The guarantee is a given, just are "Free" maintenance estimates.....LOL

[Bill Schwab]

I kind of agree with gsdx, except, in the rebelious state I have been in for the past few years, I beleive that if we all get better at knowing our numbers, we can dictate what someone will pay and if they don't like it, they can calus up their own palms.

And Glan makes an intersting point. I have had days where I cost something out just for yuks. Amazingly, no matter how you run the numbers, you can always find a multiplier that will get you so close it squeeks. Multipiers work well for WAG bidding. Most of the time, they will get you by well. But there is that one time when you could have reay scored, and, you let that time pass. By calculating every bid, you minimize the times you loose and maximize your gains, assuming you know your numbers.

[Hamons]

Anothdr factor I have to figure into planting is condintion of the ground. For example, ona l arge landscape renovation -- where I ma adding all new beds -- If I have already worked into my price preparing new beds and adding multiple yards of compost and tilling 9 " deep -- then I do not need to charge a terrific amount for planting 125 boxwoods. I may only need to charge $5 a plant to do the planting. However, if I am planting a few boxwoods in an existing bed then I may need to charge 10 - 15/ shrub to make any money just on the planting.

What has worked the best for me on large jobs where I am planting several hundred individual plants is to use my own time charts I've made on how long it takes to plant material and then use a degree of difficulty scale if I need to adjust the price.

[Gardenhaus]

The invarialble question...how much do I charge?

Some people 2x 3x 4x.....some guess, some charge what the other guy does and some throw a dart

My father-in-law taught me that first you have to be able to answer these two questions......what is my break even point and at what average gross profit margin...if you can't answer that...stop and start over.

cost to do anything in our business is based on your fixed overhead..things you have to pay for whether or not you sell a seed.....this includes management salaries, phone, computers, ads, business cards, website, insurance and any and all debt service payments.

Lets say this number is 100,000.....the first time I did this 18 years ago was scary and then empowering......now the math gets simple, to break even at 50% gross profit margin you need to do 200,000 in sales at 40% you need to do 250,000 in sales and at say 20% 500,000 in sales........this is gross profit on a project after subtracting, materials, shipping, mileage, labor, workmens comp, tractor time.

We developed an excel spread sheet that considers all of the above and provides us with a price structure from 30-55% gross profit margin. we look at project difficulty, our schedule and the client and make a pricing decision. We do not and never will do bid work....I have a cartoon on my desk that shows two people pushing a large block up a pyramid and they look at each other and one says....I told you we shouldn't have bid this!

Our minimum for planting trees is ten trees.....it costs us almost the same to plant ten as three. We still need to meet with the client, put together a price, order the trees have them delivered to our office or the site, I still need to bring over our enclosed trailer pulled by an f350, use our dingo to dig the holes and place the trees and our stake body for mulch......seven more trees is not that big of a deal.

Garden centers in our area plant individual trees all the time and I can't imagine they actually make money doing that.

Now our approach may seem pretty simplistic......as we all know 80% of our profit comes from 20 % of our clients and the rest of our clients actually eat into our profit. We have chosen to only work for the 20% that make our profit. It has taken us 18 years to get to this point. But it is rewarding.

My father-in-law built a mutlimillion dollar construction business in the 70's using this concept and so it works if you are doing 100,000 a year or 2 million a year. He always said, you can make no money out playing golf so why would you want to be working and make no money?

He unfortunately passed away last year, and the greatest gift he ever gave us was his business knowledge. He was from the old school, I made mine you need to make yours and never helped us financially.....but his business knowledge was golden.....