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Cutting Costs Takes More Green

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By RUSSELL RAY

The Tampa Tribune

Published: July 23, 2008

T AMPA - In Florida, where the grass stays green year-round, mowing the lawn isn't optional.

Neither is the cost.
Rising gas prices are leading residents to dump their lawn care services, which are charging higher prices to offset the skyrocketing cost of fuel.

Albert Boromei, owner of Green Guy Grass Cutters, said he spends $14,000 a month on fuel for the trucks, mowers, edgers and trimmers that keep his business running.

"It used to be $6,000" a month, Boromei said.

He pointed to the increasing cost of two-cycle oil, an essential component for trimmers, edgers and blowers, which run on two-cycle engines. A gallon of two-cycle oil costs about $14, he said.

"The additional oil byproduct has quadrupled in cost," he said. "It's a good 60 percent of our fuel."

Knowing he would lose business, Boromei decided to pass on the higher cost on to his customers.

"I put a fuel surcharge slot on all of my invoices," he said. "It was a hard thing to do because we have some customers that are pretty loyal to us. They're dealing with the same issue."

Although his rates are about 25 percent higher, Boromei said his profit margin hasn't changed.

"In this industry, the margins are very modest," he said. "You're talking 6 to 12 percent on a great day."

In Florida, gasoline prices are averaging $4.04 a gallon, up from $2.94 a year ago, according to AAA. Motorists in the Tampa Bay area are paying, on average, $3.97 for a gallon of gas, $1.09 higher than this time last year.

The bone-jarring cost of fuel has put some lawn care services out of business, Boromei said.

"I'm seeing the smaller guys kind of go away," he said.

With gas at or above $4 a gallon, lawn care companies have to be more selective about choosing customers. Driving 20 miles to mow a single lawn isn't cost-effective.

"I've had to turn down clients that wanted service," said Randall Sharpe, owner of Grass Execs in Tampa.

To reduce fuel costs, lawn care businesses are building their customer base in specific parts of Hillsborough County.

"We had to start putting our customers in one area, and we're sticking to it," Boromei said. "I started doing that two years ago."

Sharpe remembers when he could drive to Naples and other areas of the state to provide lawn care services and still make money. Those days, he said, are over.

"Logistics are the key right now," he said.

Sharpe, who spends about $100 a day on fuel, recently started charging his customers an extra $10 per session. But the higher rate covers just a portion of the increase in fuel costs, Sharpe said.

Profits are down an estimated 30 percent, he said.

Raising rates any higher may lead to a loss of business in a competitive line of commerce, Sharpe said.

"You have so many startups," he said. "It's something you can do with little or no money."

Reporter Russell Ray can be reached at (813) 259-7870 or rray@tampatrib.com.

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