Kill, keep, or reprice: what to do with every client on your list

Your P&L shows one number for the month. That number is a blend: a few clients earning real money and a few quietly burning it, averaged together until the bleeding disappears. The bottom line looks survivable, so nothing gets fixed — and your best accounts keep paying for the privilege of keeping your worst ones.

The fix isn’t a prettier P&L. It’s a verdict on every client: kill, keep, or reprice. Here’s how to run it on your own list, with the decision rules and a worked example.

Step 1: Rebuild each client at true cost

You can’t sort clients until you know what each one actually costs, and the invoice total tells you nothing. The number you need is crew hours on that client × your fully-loaded crew rate, plus materials at cost.

If you haven’t built your fully-loaded rate, do that first — the whole walkthrough is in what a mowing crew hour actually costs. Short version: a $22 wage carries the employer side of Social Security and Medicare (7.65% per IRS Publication 15), workers’ comp, downtime, drive time between stops, and a fair share of the shop, trucks, and insurance. In that worked example the stack lands near $48 per billable hour — overhead share included — before the crew cuts a blade of grass.

So the per-client math is short: pull crew hours from your timesheets or route sheets, multiply by your loaded rate, add materials. Revenue you already know. Subtract, and for the first time you have a real margin on every name in the book.

One warning: use the hours the client actually consumes, not the hours you quoted. This is where losing accounts hide. The “while you’re here” requests, the gate that adds ten minutes every visit, the callback because the sprinkler head got clipped — none of it shows on the invoice, all of it shows on the timesheet. In the books I see, the worst clients are rarely the cheapest ones. They’re the ones eating hours nobody wrote down.

Step 2: Sort into three buckets

Every client lands in exactly one bucket. The rules are simple on purpose — the moment “but they’re nice people” enters the math, the math is over.

KEEP — at or above your 20% net target

These clients pay their full freight and leave a real margin behind. Protect them: renew early, answer their calls first, never let a keeper churn over a $30 irritation. And don’t discount them at renewal to “reward loyalty” — that’s how keepers migrate into the reprice bucket.

REPRICE — below target, or below breakeven but salvageable

Salvageable means there’s a reason to fight for the account: it sits on a dense route, anchors a neighborhood, or feeds bigger work. The new rate is true cost ÷ 0.8 — that’s the price that leaves 20% net. It’s arithmetic, not a negotiation opener. You don’t pad it expecting to get talked down, and you don’t shave it because the ask feels big. The number is the number.

Urgency splits this bucket in two. A client sitting at 12% net is underpaying you; fix them at renewal. A client below breakeven is being paid by you — every visit moves cash out of your account and onto their lawn. Those don’t wait for a convenient moment. Those get the letter this month.

KILL — below breakeven, no route density, no strategic value

Some accounts can’t be saved at any price a human would pay: the one-off lawn 25 minutes from your nearest stop, the property that eats a trailer’s worth of drive time for a small invoice. Killing one frees three things at once — crew hours you can sell to a keeper, route time that tightens the whole day, and working capital you were quietly lending out. If that loss has been riding your credit card, you’ve been financing someone’s lawn at the above-20% average card APR the Federal Reserve tracks. They wouldn’t take that deal. Neither should you.

The five-client worked example

Everything below is illustrative — five made-up clients on one crew’s month, using a $48 fully-loaded rate. Your wages, routes, and overhead will produce different numbers. The arithmetic won’t change.

Look at the blended line: $1,015 on $8,900. Eleven percent net. That’s the number your P&L shows you, and it looks like a business that’s getting by. Underneath, C and D are burning $405 a month of what A and E earn — every month, invisibly.

Now run the verdicts. B reprices to $1,468 ÷ 0.8 = $1,835. C reprices to $1,048 ÷ 0.8 = $1,310. D gets killed, freeing 19 crew hours plus nearly an hour of windshield time per visit. The new book: $8,945 in revenue, $6,928 in cost, $2,017 margin — 22.5% net. Same crew, same trucks, one fewer stop, double the profit. Refill D’s 19 hours at a right-priced $60 and that’s another $1,140 a month of revenue on top. One honest caveat: that after-picture assumes the freed hours get refilled — empty hours still eat overhead, so kill with a plan for the slot, not just relief.

This table — run on every client in your actual book, not five invented ones — is the core deliverable of the audit. The sample report shows what the full version looks like.

How to deliver a reprice without burning the account

Timing first: raise at the renewal or the season boundary, not mid-contract in July. A mid-season surprise reads as a shakedown; a renewal letter reads as business. The one exception is a client below breakeven — waiting nine months to stop losing money is its own kind of expensive, so those get the conversation now, framed as “the current rate doesn’t cover the work, and here’s the rate that does.”

Then say it straight, in one paragraph, naming the real costs: wages are up, workers’ comp and insurance are up, fuel and equipment are up — and benefits and payroll costs beyond the wage itself run around 30% of total compensation per BLS data. New rate, effective date, thank you for the business. No apology, no three pages of throat-clearing, no “let me know your thoughts.” Clients respect a straight number more than a nervous one.

Here’s the whole letter, for the illustrative Client C above: “Starting with the new season, your monthly service moves from $900 to $1,310. Labor, workers’ comp, insurance, and fuel have all risen, and the current rate no longer covers the cost of the crew time your property takes. We’d like to keep serving you at the new rate — it takes effect March 1.” Four sentences. Done.

And be ready to lose the account. That’s not a risk of the plan — it’s part of it. A client who walks rather than pay a rate above your breakeven was never a client. They were a donation you were making, weekly, with a trailer.

Reprice before you hire

The most expensive mistake I see operators make: the book is full, so they add a crew — on top of broken rates. Now the losing math runs twice, with a second truck payment attached. If you’re slammed and still sweating payroll on the 14th, capacity is not your problem. Price is.

Sequence it: verdict every client, reprice the salvageable ones, kill the hopeless ones, refill the freed hours at full rate. Hire only when a right-priced book is out of hours. The margin that shows up funds the next truck in cash — and it’s the same margin that banks your winter reserve instead of a card balance.

Then make it a habit. The verdict isn’t a one-time purge — costs drift up every year and clients drift down the buckets quietly. Run the list once a season, at the same time you build the winter plan, and no account gets to lose money for three years before anyone notices.

FAQ

Should I fire my unprofitable lawn customers?

Usually not. In the books I see, most losing clients are mispriced, not hopeless — at the right rate they become keepers, and the customer decides whether to stay. Reserve the kill bucket for clients below breakeven with no route density and no strategic value, where no realistic price fixes the drive time.

How much can I raise prices without losing everyone?

There is no universal percentage, and anyone quoting one is guessing. The honest anchor is your own breakeven: any price below it means every renewal costs you money, so the floor is arithmetic, not nerve. Expect to lose a few accounts at the bottom of the list — if they only stayed because you were subsidizing them, losing them is the plan working.

What order do I fix pricing in?

Reprice the below-breakeven-but-salvageable clients first — they are costing you cash today. Move the under-20% group up at their renewal or season boundary. Kill the no-hope accounts as you can refill their hours, and only then think about adding a crew.