If you own a landscaping business, your number one priority is to grow your list of happy clients and consistently add new projects to your workflow. Often, getting a new project means submitting a successful bid. Even for seasoned landscapers, bidding and winning projects can be a challenge—you must find the perfect balance between setting a competitive price while still earning a profit for your work.
Since every landscaping project is different, there’s no one-size-fits-all solution to building the perfect bid. There are some general guidelines you can follow to make sure your bids are competitive but still net you a profit. Read on to learn how to price landscaping jobs in 4 simple steps.
What to include in your landscaping bid
Any contractor or landscaping company should submit a bid in two parts: an outline of the full scope of work you’ll perform and the price you charge for the service. This process will help you accurately price a landscaping job.
Learn the 4 things you need to do before submitting your landscaping bid. This includes preparing your scope of work, breaking down the costs to determine pricing, including your markup to compensate your business, and providing a thorough quote.
1. Get a full scope of the work
You need a comprehensive understanding of every proposed project to craft accurate, competitive estimates. At the start of the bidding process, gather all the information you need to understand the full scope of work that the project demands and make sure to visit the site so you can get a lay of the land.
Some of the considerations you should account for in these initial stages include:
- Job location: In general, the farther away a project is from your home base, the more you’ll have to charge the client to cover fuel and travel costs.
- Safety and accessibility: When you stop by the site for an initial overview, look for any property damage, safety hazards, or accessibility concerns and account for them in your bid.
- Timeline: In general, you should charge more for clients working with a tight timeline, if they absolutely need the job done right away.
- Scope of service: The extent of the services you’re providing will dictate how much you can charge. A more specialized service, like building a retaining wall, will cost more than something standard like installing sod.
2. Break down your costs
Once you have a feel for the overall scope of the task at hand, you need to consider the costs you’ll shoulder to complete it. This is one of the most important components of learning how to price landscaping jobs—your profit margin relies on getting this step right. Generally, these costs fall into three categories:
- Labor: It’s easy to calculate labor costs—simply multiply the number of hours you need to complete the project by the hourly rate you charge. And if you plan to have several people working on the project, multiply this number by the number of workers to calculate your total labor costs. Also, if you plan to work with any subcontractors to complete a project—like hardscape designers, outdoor lighting experts, etc.—make sure to include those costs, too.
- Materials: Consider everything you need to get the job done, including tools, equipment, and raw materials like dirt, mulch, sod, stones, etc. The volume of materials you need will vary from job to job, so your initial site visit is essential in helping you estimate accurate quantities.
- Overhead: You need to account for overhead costs in every project. These expenses include advertising, legal fees, office rent, utility bills, and more. Also, make sure you hold a current landscaping insurance policy. Acquiring a Certificate of Insurance will put potential clients at ease, demonstrating to them that you’re professional and prepared.
3. Include your markup
You’re in the landscaping business not only because you enjoy working in the great outdoors, but also because you want to make a profit while doing what you love. After you’ve calculated your total costs—not just to complete the task at hand, but also the overhead costs that keep your small business running—you need to determine your desired profit margin and the markup percentage you need to charge to get it.
In general, landscaping companies aim for a profit margin of 15 to 20% for residential jobs and 10 to 15% for commercial ones. You need to give yourself a bit of wiggle room to achieve those kinds of margins, so the markup you charge for the job should be slightly higher. For example, if you need a 15% margin, add a 20% markup to your overall costs to complete the job. Once you’ve determined your margin and markup, you can add it to your costs to arrive at a grand total for the project.
4. Craft a winning quote
Once you’ve calculated the overall price of a landscaping job, you need to provide your client with a comprehensive quote. A quote is a professional document that details the scope of work you’re performing and the breakdown of the costs of the project, as well as any important terms and conditions. A professional-looking quote lends credibility to your business—it can often seal the deal when it comes to winning a project. Every written quote should include:
- Your company name and logo
- Your contact details
- A complete service description with dollar amounts
- Your client’s information and a quote expiration date
- Terms and conditions, like required deposits
Create a winning bid for every project, every time
Learning how to price a landscaping job is all about balance. You have to competitively price your services to win bids, but you also need to include enough room in your quote to earn a profit for the work you’re doing. By following the simple steps listed above, you can craft better bids that help you win more projects and watch your landscaping business grow and thrive.
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