Pricing large acreage mowing jobs

[tmc_31]

Hey all,

I have been mowing/shredding for several years now. Most of the jobs run between five and ten acres. I am pretty comfortable pricing those. I just finished mowing the largest acreage (50 acres) that I've done to date. I was a little hesitant to take the job because of the relatively small size of equipment I generally run (TN70D 58pto hp tractor and a Rhino SE7 rotary mower) but I took it anyway. It turned out well. I had had another call a few weeks earlier inquiring about mowing 100 acres of CRP land. I gave the guy a price but I got the sense that he felt it was too high although he never said so. That job won't happen until late summer if it happens at all.

While I was mowing the 50 acres, a fellow walked up to me and asked what the land owner was going to do with the acreage that I was mowing. I told him I didn't know that I was just hired to mow it for him. He seemed to know the owner but hadn't spoken to him in several years. In passing, he asked what I charged for mowing. I asked how much acreage he was talking about. He said "about 1000 acres". I really didn't know what to tell him so I blurted out the price per acre that I was charging the current customer. His comment was "wow, I don't believe I could afford that". We chatted some more and I failed to ask him what kind of pricing he was used to for that kind (amount) of mowing:duh:.

My question to you is what kind of pricing is typical for mowing acreages this large ( say a section or more)?

I realize that my equipment is a little light in the shorts to take on a mowing job of this magnitude. Just for grins I estimated that it would take about 400 hours to mow his 1k acres with my equipment. If I had say a 110 hp tractor and a 15' bat wing shredder, I do it in about 125 hours, a much more reasonable time frame I think.


Anyway, what say you?

Tim

 

[dodge man]

It doesn't matter what business you are in, someone will always think you are high. You probably have a pretty good idea what the costs are for you and I'd stick to those numbers. Its not any fun to take a job knowing you will lose money or not make the money you should. Don't join the race to the bottom for prices.

 

[smstonypoint]

I realize that my equipment is a little light in the shorts to take on a mowing job of this magnitude. Just for grins I estimated that it would take about 400 hours to mow his 1k acres with my equipment. If I had say a 110 hp tractor and a 15' bat wing shredder, I do it in about 125 hours, a much more reasonable time frame I think.Anyway, what say you?

Tim,

I assume that your current cutter is 7' wide. What assumptions are you making about your ground speed and field efficiency?

Using the formula for Theoretical Capacity (acres/hour) = (Speed (mph) x Machine Width (feet))/8.25, and assuming a speed of 5 mph, you could mow 4.24 acres per hour in theory. But in the real world of thunder and lightening, you have to allow for turning, overlap, refueling, bathroom breaks, etc. Field efficiency factors are used to adjust theoretical capacities for real-world conditions.

Effective Capacity = Theoretical Capacity x Field efficiency.

http://www.caes.uga.edu/departments/bae/extension/handbook/documents/capacity.pdf lists mower field efficiency factors ranging from 0.75 to 0.85. At a ground speed of 5 mph, and field efficiency of 0.80, I come up with effective capacities of 3.39 acres/hour for a 7' cutter and 7.27 acres/hour for a 15' batwing. It would take an estimated 295 hours to mow 1,000 acres with the 7' cutter and 138 hours for the 15' batwing, a difference of 157 hours.

Assuming a labor rate of $30/hour, using the smaller tractor and cutter would result in an additional labor cost of $4710 for the 1,000 acres.

The larger tractor and batwing are going to have higher ownership costs, but chances are those higher ownership costs are more than offset by the lower variable costs of the larger tractor/mower on 1,000 acres.

Steve

 

[tmc_31]

You are right DodgeMan, all most all customers seem the think the price is too high. I do have a good feel for what it costs to operate my equipment and I won't knowingly take a job that I am going to lose money on (except for helping friends & neighbors).

Thanks for attaching that capacity chart stonypoint, I had not seen that before. I developed a spreadsheet a few years ago that I use as a guideline for pricing these jobs. I started out using a 90% field efficiency which matched TractorData' mowing calculator. I quickly found out that that was way to high. After gathering some data over several of my jobs I finally settled on 70% as a field efficiency factor. That is what I use in my pricing model now. Using my equipment, my prices range from $42/acre down to $28/acre. If I use larger equipment (15' shredder and a tractor big enough to pull it with) I estimate that I can do the job (1000 acres) in about 160 hrs (70% efficiency) for about $12/acre. Quite a difference eh?

So again, when a guy who has a large acreage to mow goes looking for a contractor, what kind of price can he expect to pay?

Tim

 

[smstonypoint]

So again, when a guy who has a large acreage to mow goes looking for a contractor, what kind of price can he expect to pay?

It depends.

Several land-grant ag. economics departments conduct periodic surveys of farmers to the determine the rates they pay/receive for custom work.

Here are some examples. (Google custom farm rates for other examples.)

Mowing CRP or pasture, $/ acre average = 16.15 range 10.00 - 28.00 for Iowa, 2014. https://www.extension.iastate.edu/agdm/crops/pdf/a3-10b.pdf

Bushhogging Pasture or CRP Acres, $/acre, average = 14.46 variation* 10.03 - 18.89 for Indiana, 2013 https://www.extension.purdue.edu/extmedia/ec/ec-130-w.pdf.

* Variation was computed based on the average rate minus or plus one standard deviation, which means approximately two-thirds of the reported rates used to compute the average rate are between these two numbers.

MOWING GRASS PASTURE OR CRP, $ PER ACRE, average = 13.80, range = 6-30, mode = 15 for Nebraska, 2014.
http://www.ianrpubs.unl.edu/live/ec823/build/ec823.pdf

Pasture shredding, $/acre, average = 22.06, range = 12-60, mode =30 for Texas, 2013.http://agecoext.tamu.edu/files/2012/05/CustomRateSurveyMay2013.pdf.


Does pasture shredding differ from bush hogging?

These surveys do not distinguish between rates for "small" versus "large" acreages. I suspect that the rates at the low boundaries of the ranges apply to large equipment on larger tracts.



Steve

 

[bigbull338]

for large jobs over 25acs id have a batwing shredder.here if i was going to shredd for people id charge $15 an ac.

 

[jenkinsph]

I suspect the best approach to custom work is to pass on the largest tracts and keep mowing the smaller common sizes. Unless you have many of the large tracts under contract you can easily wind up making less money on them than you are making currently on the smaller tracts. Another thing to consider is moving the larger equipment which can require a whole new rig.

 

[Depmandog]

Another thing to consider is the owner's expectation in regards to time of completion. If I hired you to hog 1000 acres, I sure wouldn't want someone that was expecting to be on site for 6-8 weeks!

(Unless he told you - "When you finish - just start over, it could use mowing again" )

 

[tmc_31]

Thanks guys. After reading your posts and doing further research on my own it appears that I really need to stick to the less than 25 acre jobs in order to be competitive if I am going to use the equipment that I currently have. The thing that may get me some of the larger jobs is that it is hard to find operators using larger equipment in this area. Most of my competitors seem to be running 8N sized tractors and 4'-5' shredders.

I have been looking for a 12' bat wing for a while now. It seems that the Rhino TS12 is targeted towards tractors the size of mine and smaller. The problem for me is that there are not many of them on the used market around here and when you do find them the owners want nearly new price. It has occurred to me that I may be able to buy a medium duty 15' bat wing like the Rhino SD15 for less money since they are more widely available on the used market. It also occurred to me that if I get into heavy grass that will slow me down significantly I could remove the driveline from one wing and raise the wing thereby reducing my cutting width to 10'. Most of the pasture grass in this area is pretty light. Especially in the last few years during this drought we are suffering. If this is feasible, it might be a way for me to go after some of the larger mowing jobs without spending a lot of money.

Steve, as far as this discussion is concerned Bush Hogging and pasture mowing are one and the same.

Thanks,

Tim

 

[KiotiKowboy]

Steve, as far as this discussion is concerned Bush Hogging and pasture mowing are one and the same.

So - just what is the technical difference between mowing, bush hogging and shredding?