Contractor Pricing Strategy
Most operators know what they charge. Fewer know what a job actually costs them. The gap between those numbers is your margin — and if you're not calculating it honestly, you're guessing at profitability.
The average residential mow costs $23-37 to perform when all inputs are counted Most operators undercount by ignoring drive time, admin, and equipment depreciation The "door-to-door" model captures total cost; "time-on-lawn" does not
Most operators know what they charge. Fewer know what a job actually costs them. The gap between those numbers is your margin — and if you're not calculating it honestly, you're guessing at profitability.
For the full pricing strategy framework, see The Lawn Care Pricing Playbook.
The common mistake: pricing based on time-on-lawn. A 30-minute mow at $50 looks like $100/hour. But you're not on the lawn for the full hour. What gets missed: drive time between jobs (the largest hidden cost), load/unload, admin, equipment depreciation, insurance, and vehicle costs.
| Cost Component | Details | Cost |
|---|---|---|
| Labor | 55 min door-to-door @ $22/hr loaded | $20.17 |
| Equipment | Mower + trimmer + blower depreciation per job | $3.50-5.50 |
| Truck/trailer | Fuel + insurance + depreciation per stop | $2.50-4.00 |
| Consumables | Trimmer line, fuel, oil | $1.50-2.50 |
| Overhead allocation | Phone, software, marketing, office | $2.00-3.50 |
| Total cost per job | $29.67-35.67 |
At $50/visit, your margin is $14-20, or 29-41%. Healthy — if your route density supports 55 minutes door-to-door. Push that to 70 minutes (scattered route) and cost rises to $37-43, squeezing margin to 14-26%.
| Component | Solo Operator | With Employees |
|---|---|---|
| Base wage / owner draw | $18-25/hr | $14-20/hr |
| Payroll taxes | Self-employment tax | +$1.50-2.50/hr |
| Workers comp | Included in GL or N/A | +$1.00-3.00/hr |
| Total loaded rate | $18-25/hr | $16.50-27.50/hr |
Solo operators: assign yourself a market-rate hourly draw and calculate costs against it. "I pay myself whatever's left" makes profitability invisible.
| Equipment | Purchase | Life | Annual Cost | Per-Job (800 jobs/yr) |
|---|---|---|---|---|
| Commercial mower | $8,000-12,000 | 3-5 yrs | $2,000-3,000 | $2.50-3.75 |
| Trimmer + blower + edger | $950-1,500 | 2-3 yrs | $340-570 | $0.43-0.71 |
| Maintenance + repairs | — | Annual | $800-1,500 | $1.00-1.88 |
| Total per job | $3.93-6.34 |
At 500 jobs/year instead of 800, these numbers rise 60%. Volume matters.
| Route Density | Avg Drive Time | Revenue Lost/Day @$50 | Season Impact (160 days) |
|---|---|---|---|
| Dense (3-5 min) | 4 min | Baseline | Baseline |
| Average (7-10 min) | 8 min | -$50-100 | -$8,000-16,000 |
| Scattered (12-15 min) | 13 min | -$100-150 | -$16,000-24,000 |
Same prices, same skills, dramatically different economics. For density strategies, see Common Pricing Mistakes.
| Target Margin | Multiplier | On $32 Cost |
|---|---|---|
| 20% | 1.25x | $40 |
| 30% | 1.43x | $46 |
| 40% | 1.67x | $53 |
Industry benchmarks: 15-45% net margins for well-run operations. See How to Set Profit Margins for targets by service type.
Should I include my own time as a cost? Yes. If you're mowing, driving, or doing admin, assign an hourly rate that reflects replacement cost. Profit is what's left after that.
How often should I recalculate? Annually at minimum, before each season. Recalculate after any significant shift in fuel, labor, or route structure.
What if my cost is higher than what I charge? Raise prices, improve density, or reduce costs. No sustainable path at negative margin. See When and How to Raise Your Prices.