What is your leads and work costing you?

Eric Frei

From what I see often it appears that many do not actually figure out what it costs them to do a quote.

Sure the industry is rife with people giving free quotes but......

When you look at your marketing costs it would be fair to say that the bulk of it (say 90%) is for new work not repeat business. Some repeat business people might refer to your advertising to get you back but it's best if you try to eliminate that by giving them cards etc.

If you divide the cost of your marketing by the quotes you do (quotes generated from marketing) you have a rough idea of what each lead is costing you.

Other factors include stationary, phone, vehicle costs and time to quote.

If you spend say $50,000 on Yellow Pages (some spend more in fact), and you get 1000 quotes a year from it ... the raw cost is $50 a lead. Now add the overheads in for doing that quote and I dare say you'd be over a $100 each.

There's other issues though, likely to that you'll get telemarketed and time wasters burning up your cash, the more you advertise the more time wasters you get. You might do local papers and get some real tight wads (yeah they hang there the most).

So if you land a job I would say it's conservative to say it has cost you $100 to get the job.

Now what does it cost to have a crew go there, just to drive there? Maybe 3 men and a truck/chipper I think it would cost $200 to just pull up let alone do work. Some people have figured this out and have a minimum charge like say $300, and some go there and do a stump grind for $50 so how they make money is beyond me.

So what's your thoughts and experience? What's a lead costing you? Have you a decent reciprocal arrangement with other companies across town that you can give distant leads to who also give you some back in your area?

__________________

Jeff Darby

This is a very good subject for all who own business's, have you considered these hiden costs.lol, that's actually is staring you in the face?

Some more than likely would take the emu approach and have your head in the ground not wanting to know cause all of a sudden you will work out you have been busting your your guts out for jack!

You need to take into consideration everything you do to generate your income.

__________________

Member: Australian Tree Association

Join the Australian Tree Association...Have your voice heard !

Arboriculture, A life long study for some, a passing phase for others

© Jeffrey J Darby 2011

kel

Certainly an interesting topic and one that needs to be factored in to stay in bissness. What you may also need to calculate in is the % of the quotes you actually get. If you actually only get 75% of the quotes then ad cost goes to $66.(using ekka's 1000 quotes from $50000 ads) Just to show you how the other half live, I operate on "word of mouth" only (actually letter box dropped a 100 flyers or so 14 yrs ago to get started). 'No advertising', to the extent that I'm reluctant to "give a handful" of cards to someone to hand out, as you do get requested every now and then. You can laugh, but I'll get 95%+ of my quotes (7 still outstanding for 2009) and it keeps me on my toes, in that if I don't impress/ do a great job then work could start to dry up. As for "start up" cost, I try and get paid 1 1/2 hrs for the 1st 1/2hr then /hr after that. You got to admit though that there are huge variations in prices due to several unavoidable reasons/ factors. ie experience, contractors preference to certain work, gear/ equipment avaliable and $/hr the contractor needs to break even.

Victor Lindsay

Just to keep this question simple, I have a very low advertizing campain. YP ad, signs, ISA website, my name on the county list of arborist, and I pay landscapers and such %10 for leads that i get the job. YP ad cost me 38.00 per month. I've just started asking where the client found my name, so i can track results. And i get a high percentage of my bids...very high.

Victor Lindsay

Just got one today. I was 250.00 under the other company, so the client wanted to know if i would be giving him the same amount of work as the other guy. Did a face to face, and I got the job, and will be doing less than the other guy, plus he gave me anouther job that i bid at top dollar. The job was for mangrove trimming, ( the other guy was selling him a 50% reduction and i was selling a 20% reduction) I won!

Drouin Tree Service

Some leads are rewarding some are far from it

__________________

Drouin Tree Services | Excavator Hire - Drouin and SE Gippsland | Landclearing Melbourne

rbtree

Print YP advertising is a dying breed. Online is where it's at, at least in areas like mine where there's scads of computer savvy folks. I've dropped all my print coverage save for a one inch ad in three books, which costs about $250/month. I advertise online with AT7T's YP.com....costs too much for the return, so will be reducing my exposure and costs there.

I use two lead generating services, at $12-28 per lead cost.

Next, I'm going to be optimizing my website so that it draws traffic at no cost save for the web designer's skills. And vastly improving the content of my website.

I don't use services like Google Adwords or other pay by click or impression forms of advertising..or paid pop up ads.....though they prolly work well.

I'm also doing some specialty advertising, where my ad shows up on different types of local media--posters for school sports, a radio station website..etc etc.....I've done a bit of that in the past with poor returns....so will monitor my current ads to see if they work.if not, drop em.

Eric Frei

The absolute worst I did was advertise on beer coasters in a posh golf club!

__________________

kflood74

Anyone have vehicle wrap advertising. If so what did it cost and does it generate a lot of leads?

dov

Sure business has taken a while to take off (still under 2yrs on my own) but it finally seems to be going along nicely. Most of my customers find me through either the Yellow Pages (single line ad in locality guide - $300 pa) or word of mouth. I've recently gotten business cards, but don't know how much that will help. One or two jobs should pay for them, so not a bad investment anyway.

Quotes. Good question. I haven't built them into my costings anywhere.

Drouin Tree Service

I find some of the best leads are "circulating"leads when they see you working elsewhere and ask for a qoute.

At a guess i would say a lead coming out of print advertising costs me $30-$40 the website that Eric built me does much better thanks again

__________________

Drouin Tree Services | Excavator Hire - Drouin and SE Gippsland | Landclearing Melbourne

dov

Ye, I forgot about those. Prob. about 10-20% of my business. I get a lot of people asking for quotes or my phone number, but not as much business as direct word of mouth.

TrevMcRev

Had my truck done, and have just had the concept for my car done, it should go on in the next week or so.

I think it helps a lot with the sort of leads alopa mentioned. The crew are always being asked for quotes or business cards during jobs.

You truck can be your mobile billboard if you get it right, so many plain trucks around with not even a name on them. The only advantage to that you can drive like an ass in traffic and do dodgy mulch dumps

Attached Thumbnails

     

kflood74

Wow, that looks sweet. How much do they charge you for one vehicle wrap?

TrevMcRev

About $3K here in Australia.

Brent Ferris

I found when I advertised on the truck, the truck was broken into on a regular basis, and it was cheaper to have a plain truck.

I try hard to get 30-50% repeat business or referrals. The rest comes from cards and direct face to face contacts thru consumer shows.
When I first started in the 80's, these shows had a followup of about 30-35%. Since then, those numbers have dropped, and in a recession year like this one, it is around 10%.
The two shows I attended this year cost about $7K for the shows, ignoring lost time, help, food, parking, truck rental and moving, and extra printing. I ended up with about 100 leads.
About 10% never answer your calls. About 50% think you're too high, or too all-knowing (or not knowing enough), or too pushy or not pushy enough. This year, that number was higher, and so many of them couldn't seem to make a decision. Might be for the best. If they can't decide what they want done, they might not be able to decide to pay either.
Now if you are doing the math, it sounds like $700 to $1000 per lead. But I generally find, it is the people that don't sign up at the show, but just take your card and your literature, and talk with you face to face - that give me the best jobs. If i end up with 100 to 150 jobs for the year, I am usually ok.
The trick is to have enough followup after the show, to tide you over until the wait-and-see people get around to calling you. It usually isn't a problem, but this year people are unusually cautious, and so money is really tight this year -- at least so far.
My running costs are fairly low - the truck is the biggest spender after labour -- I have no chipper, and use a pickup with a custom dump box to dispose of clippings. I aim for a ballpark number every day, and some days make it no problem, and other days come nowhere near. Not including estimates, or wages for me, costs add up to about $300-$400 per day. If I have another climber for a difficult job, he adds another $250 for the day, but the take-in is better.

Of course if I worked out an hourly wage, my workers probably make more than me. Thankfully I love the job I do, and my wife has a great job that pays the house bills.

dingo

guys I suppose im after some advice because at the moment I'm a bit worked up and don't want to do anything rash.

I have been in business for just a year now and have relied on a modest spend with yellow pages (a bit of online and a bit of print). They have pulled a major swifty on me to cut a long story short and I feel like breaking my contract. Do you think I am going to find it rough going generating work thru alternate channels whilst my business is still in it's infancy. I work around northwest sydney...

Cheers
Chris

Apocalypsse

Does much of your business come from Yellow Pages or ads in local papers? I can't remember the last time I used a phone book for a business, or even the yellow pages website. Do your customers say they found you in the Yellow Pages?

dingo

Hi Apocolypse,

During the start up phase of my business I rely on yellow pages for pretty much 90% of my work, just to get the ball rolling you could say. I have spoken to the accc and now have a strategy for my dispute to be resolved thankfully. I won't be doing anything rash but for some reason when I get hot under the collar it's those options that first spring to mind.

Chris

Paul Toivonen

Funny how most people say YP print is going out.
Sure it costs a lot, but is a good client source.
Whenever I am after a supplier YP is the only way to find a bunch of them fast, who are local.
I have tried to search online and found most arent listed or the listings are not complete.
Depends what you are looking for. Still, having them on paper in front of you remains the best way to find people.
Two "free" quotes to do today and I am meant to be on holidays.
If I dont do them today who knows when I will be able to.
Like I say "Get used to doing quotes, plenty of 'em."

dingo

Spot on BlackMoses, yellow pages may be in decline but not accross all sectors. Ive been doing quotes the last few days also because i cant see when they will fit in next week...

Paul Toivonen

Yeah, may as well do them while on holidays, after hours, weekends and public holidays 'cos we dont get paid to do them anyway!
Did I tell you about the one who wanted a quote 10pm Sat.nite?
I did it Sunday morning for him.

dingo

thats funny,were you supposed to go have a look with floodlights and torches...I had a customer calling me at around 1:00 am once- needless to say the call went unanswered. my yp drama was resolved earlier today but i will treat them with EXTREME caution from now onwards. It literally felt like they had stolen $2k from under my mattress.

Paul Toivonen

I have found if they are serious about getting work done, they will find the time to be on site at reasonable work hours.
I used to do all my quotes after hours but you soon get sick of that.
At the end of the day we are the ones providing a service, not the other way round.

Eric Frei

This is the best bit of advice for webmasters.

__________________