Stop Guessing Your Prices: The Man-Hour Rate Masterclass

Summary

Green Industry Podcast

Episode: Stop Guessing Your Prices: The Man-Hour Rate Masterclass
Host: Paul Jamison
Guest: Jonathan Patosnik (JP)
Date: May 4, 2026

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Episode Overview

This episode of the Green Industry Podcast dives into one of the most critical—but commonly misunderstood—foundations for profitability in the lawn care and landscaping business: how to strategically set your prices using man-hour rates. Host Paul Jamison is joined by industry expert Jonathan Patosnik (“JP”), who walks through a practical masterclass designed to help business owners stop guessing and ensure every job is profitable. JP shares hard-won lessons, actionable steps, and the most important metric for sustainable business growth.

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Key Discussion Points & Insights

The Pricing Struggle for Lawn Care Pros

• Many new and even experienced professionals guess their prices, leading to undercharging and unsustainable profits.
• “Are you guessing your prices or do you actually know your numbers? ...You work your tail off...And then you feel like you made absolutely no money. Or even worse, you lost money. Well, you are not alone. I have been there many of times...” (Paul, 01:09)

The Reality of Underpricing & How to Learn Fast

• JP reassures listeners that underpricing is nearly inevitable at first:

  “I wouldn't get too worried about underpricing it. You're gonna do it. There's just no getting around it. Underpricing is just part of the game. That's how you learn. The key is that you fix it as quick as you can.” (JP, 02:30)

• The sooner you address underpricing through data and strategy, the faster your business will improve.

The “Copy the Big Guy” Strategy

• JP and Paul agree: Use established, larger businesses as a pricing benchmark.
• Larger, reputable companies have calculated their pricing to cover every necessary cost (staff, facility, insurance, vehicles).
• For new or smaller businesses without these overheads, charging similar rates gives more profit margin and resources to fuel growth.

  “If you start there and actually do that, you're going to be making wild profits because you don't have any of the costs that these guys have yet.... That's all margin. So it's a beautiful strategy.” (JP, 02:30)

• Avoid copying prices from "chuck in a truck" operators who often undercharge and don’t account for true business costs.

  “If you're going to copy one of the two, you want to copy the $72… And the other guy, who doesn't know what he's doing, he's like, 'oh, it takes me an hour. I made $40 an hour. Better than work at a Walmart.' Not understanding all of the overhead.” (Paul, 14:34)

The Power of Tracking Man-Hour Rate

• Man-hour rate = (Total amount billed to the client) divided by (number of man-hours worked)
• Example: 2 people work 1 hour on a $100 job = $50 per man-hour.

  “…When they show up at the account, they turn off the ignition time starts… That’s two hours. Two man hours divided by a hundred bucks, we made 50 bucks an hour.” (JP, 04:57)

• This metric isn’t direct profit but reveals which jobs or customer types are truly valuable.
• Use the man-hour rate to diagnose underperforming accounts and adjust pricing accordingly—no complicated math required.

  “The reason why this number is so powerful is…at a gut level, you could say, wow, when we do this work, it feels really profitable. …the number I just gave you will tell you—not the profit—but it will tell you the difference.” (JP, 04:57)

Real-World Application: Fixing the Pricing Blind Spot

• Track your man-hour rate by property size and service type.
• Spot trends: E.g., 5,000 sq ft lawns deliver $68/hr, but 9,000 sq ft lawns drop to $48/hr.
• Incrementally raise prices on the lower-performing segments and monitor the results.

  “I can look at that and say, I'm kind of thinking we need to start selling all that work at a higher price and we add three bucks a week to it or four bucks a week…” (JP, 07:38)

• Keep refining and let data—not guesswork—steer your growth.

Raising Prices Confidently (and Communicating That to Clients)

• Use a professional “price increase letter” (template available via Paul’s website) to communicate changes.
• Be transparent: Explain that price increases are necessary to absorb rising costs (labor, fuel, equipment, etc.).

  “We want to continue to do a great job for you and continue to have the best team members, but all of that's costing us more money. So, you know, in order to absorb, that's my secret word…” (Paul, 16:36)

• Don’t fear losing unprofitable clients. Replace them with premium, well-priced accounts through continual marketing and lead generation.
• Always be recruiting new, better customers to match your improved pricing structure.

Pro Tips and Tools

• Use CRM and business management software (e.g., Jobber, CallRail) to make tracking man-hour rates and managing customers easy and automated.

  “Jobber is an all-in-one business app software...You can store customer information, send quotes and invoices, schedule your appointments, and even collect payments.” (Paul, 08:38)

• Stay on top of marketing and incoming leads so you’re never desperate to keep low-profit clients.

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Notable Quotes & Memorable Moments

• On copying the right pricing:

  “You're probably not paying workers comp. I mean, who knows what you're not doing yet. That's all margin.” (JP, 02:54)

• Advice for dealing with price objections:

  “Don't get nervous...Just remember the word absorb. Yes, that's correct...We just need to absorb. Our, our costs are going up…in order to absorb that, we have to raise our prices.” (Paul, 16:36)

• On “dangerous” pricing:

  “It's very dangerous, my friend, if we take on more work at lousy prices, because now we have to do the work. But if we're not making money doing the work, we're like a rat in a wheel.” (Paul, 19:23)

• On the importance of constant customer improvement:

  “We should always be recruiting, we should always be marketing and bringing in new customers at the right price. And if we have old customers that are below average, it's time to raise their price and get it up to where it should be.” (Paul, 17:38)

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Timestamps for Key Segments

• [01:09] – Introduction to the importance of knowing your numbers; JP introduced.
• [02:30] – JP on the inevitability of underpricing and learning from it.
• [04:57] – JP’s step-by-step breakdown of the man-hour rate and how to track it.
• [07:38] – Using man-hour rate and property size data to fix and refine pricing.
• [11:57] – Paul’s summary: copying the established (“big guy”) companies, dangers of pricing advice from other “solos”.
• [14:34] – Real-world contrasting of prices between established companies and lowballers.
• [16:36] – Advice for communicating price increases to clients, using “absorb” as a key word.

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Action Steps for Listeners

• Stop guessing—start tracking. Use the man-hour rate on every job and regularly review your accounts for underperformers.
• Benchmark your prices. Look at what established, reputable companies in your area are charging and align your rates at or above theirs.
• Raise prices with confidence. Use clear, honest communication to explain increases and don’t hesitate to replace low-profit clients.
• Invest in systems. Adopt CRM and lead management tools to automate as much as possible, making smarter and more profitable decisions.

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Tone & Takeaway

Authentic, practical, and focused on empowering small operators to grow smarter—this episode is a direct, real-world guide to taking the guesswork out of pricing through data-driven simplicity. As JP says, “You don’t need to know everything about pricing—you just need to know this.”

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Next Episode Preview:
Paul teases more insightful conversation from JP in future episodes and encourages listeners to implement today’s practical advice immediately—starting with raising prices for better profit and peace of mind.

Transcript

[Jonathan Patosnik (JP)]

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[Paul Jamison]

Hello and welcome to the Green Industry Podcast, your go to guide for building a more profitable and thriving lawn care and landscaping business. Your host, Paul Jamison, is the author of five bestselling books, including Cut that Grass and make that Cash and his latest, Level up youp Money, all available on Amazon and Audible. Now get ready for more expert insights and practical strategies to boost your business and level up your life. Here's Paul Jameson.

[Podcast Host / Interviewer]

Are you guessing your prices or do you actually know your numbers? You've ever taken on a yard or any landscaping job? You work your tail off. I'm talking, you're sweating, you're putting in the effort. And then you feel like you made absolutely no money. Or even worse, you. You lost money. Well, you are not alone. I have been there many of times and today I'm gonna chat with Naylor and Jonathan Patosnik. They've been there as well. So my friend Jonathan Pitoshnik, we nickname him jp. He's absolutely legendary. And in today's show, he's going to drop a pricing masterclass revealing, in my opinion, in his opinion, just this is the single most important metric that that we must track and that is our man hour rate. So grab a notepad, guys. This is so important. Take notes if you are able to. If not, listen to this and make sure you remember this, because this can and will change the financial trajectory of your lawn care business forever. Without further ado, here's my friend jp Somebody's in year one mismist. Like, how much do you charge? Nine out of ten times they underprice it. Give us a tutorial on how to price a service.

[Jonathan Patosnik (JP)]

I wouldn't get too worried about underpricing it. You're gonna do it. There's just no getting around it. Underpricing is just part of the game. That's how you learn. The key is that you fix it as quick as you can. To be very specific about what you're asking. What we're trying to figure out is in the beginning, where do we even Start. The idea is that when I don't know how to price what I'm gonna do, I'm gonna just start by looking at how do the big guys charge? The guys that I aspire to be, the guys that we believe by guys, you know, these bigger companies that I would aspire to, want to be them someday, or they seem to have lots of employees and they have a reputation for pretty good work, and their trucks are wrapped in all these things that I want someday. What do they charge? Because what they're charging is how they got all that stuff. You can't go hire Jim for 70,000 bucks a year if you're charging half of what the company, you know, your competitors charge. You just can't do it. It's physically impossible. What they're charging represents the work they've done to figure out what's it going to cost to hire the right people and build the right company and have people in the office and all that. So that's a great place to start. And frankly, if you start there and actually do that, you're going to be making wild profits because you don't have any of the costs that these guys have yet. You don't have Mary in the office. You don't have an op manager, you don't have a big office. You're probably not paying workers comp. I mean, who knows what you're not doing yet. That's all margin. So it's a beautiful strategy because now you've got money to really go grow this thing. But what do most people do? They don't do what I just described. They're charging way under market, and then they can't understand what's wrong with them, why they don't have any money to hire Bob in the field and Mary in the office. Well, I just told you why. It's really. That's the solution. So now let's just. Whatever your pricing is, whether you took that advice or you didn't take that advice and you just kind of made up the pricing. This is now going to be the advice that nobody really wants to hear because it's not fun. But if you really care about the pricing, then this is advice to let pay attention to. There's a couple metrics that I would chart or track. One metric would be, I want to know what I'm making per man hour. There's one number that's actually not that difficult to track, and I'm going to get. I know source all PI can track it. I know Aspire can track it. I'm almost certain Jobber can do it. I don't know if housecall pro can do it. Guessing they can do it. Basically, per man hour rate is I bill the client a hundred bucks to do the work, and I divide it by the number of people that did the job.

[Voice Assist Virtual Assistant (Betty)]

And.

[Jonathan Patosnik (JP)]

And so if I have two people, when they show up at the account, they turn off the ignition time starts, they get out, they do their thing, they talk to Ms. Smith, they get back in the truck, they fill up their paperwork, or they complete their work on their mobile device, turn the truck back on. That's the end of the time. You take that time divided by. So that. Let's say it was an hour times the two men. That's two hours. Two man hours divided by a hundred bucks, we made 50 bucks an hour. The reason why this number is so powerful is. And I'm not even going to get into math here, I'm just going to say at a gut level, you could say, wow, when we do this work, it feels really profitable. When we're mowing Mr. Jones's yard, it feels really profitable. But when we're doing Mary's yard, it just doesn't feel very profitable. Well, the number I just gave you will tell you not the profit, but it will tell you the difference. So, for example, when I did Mr. Jones job, maybe we're making 72 bucks an hour, but when we do Mary's yard, we're making 40 an hour. Right there, you just got the information to understand where you have a problem in the business, and you just got a clue that, hey, we should fix Mary's account, and you still don't know. I just gave you an example that doesn't teach you anything about pricing. You still don't even know your pricing, but now you know where you've got a problem. I got so many things wrong. I didn't know my cogs back then. I just wasn't looking at the things that mattered. But because I was paying attention to man hour rate, we fixed a bunch of stuff. So I just kept looking at the data and spreadsheets, thinking, I think the money's in smaller accounts, which is what city turf became. And I got out of everything else. All these people say you can't make any mowing money in mowing, okay, you're wrong, but okay. And we. That's what we did. We just figured out that the money was in. In our market. Every market's different all over the country. In our market, the money was in mowing. These Small accounts. Okay, so I didn't know how to price that stuff. I copied other people's pricing, but most other people's pricing is not very good. So then what I did, and hopefully I'm not getting too long winded, but I think I'm trying to give enough information you can figure this out for yourself. I had the property size, so if so we would think of property size. Your lawn is 4,000 square feet gross lot or your lawn's 5,000 or 6 or 10 or 11 or 12. With just man hour rate and the size of your property, we could see that we make 68. I'm going to make up some numbers. $68aman hour when we do a yard is 5,000 square feet, but when we do a lawns that's 9,000 square feet, we make $48. I don't need to know what the price is. I don't need to know any magical formula for pricing. I can look at that and say, I'm kind of thinking we need to start selling all that work at a higher price and we add three bucks a week to it or four bucks a week and then eventually the data comes in again and you know, on these race prices and suddenly you're, I don't remember which number I said call your 9,000 square foot lots are making $67 a week. And that you notice the new offender is your 12,000 square foot lots are making or $68 a week, but 68 bucks a man hour. And now my new offender is my 52 to my 11,000 square foot, 12,000 stuff. Square foot stuff is making $52aman hour. Where's the problem? I mean, I think no matter how much we hated math in school, could kind of figure that one out. Like, oh, I think we should start selling that one. I didn't know anything about pricing and I don't think a lot of people need to know a lot about pricing for a lot of this stuff they do. They just need to know that.

[Podcast Host / Interviewer]

Well, that is so good. We're going to hear a quick word from today's show sponsors. And coming up, we're going to unpack everything JP Just shared. Have you ever felt like you're drowning in scattered quotes, schedules and chasing payments that never come easy? I've been there with you. I used to be a chuck in the truck, completely disorganized and constantly chasing payments. But then I started using jobber back in 2019, and it was a complete game changer for my business. Still using it today. I Love it and recommend it to all my coaching clients. Now Jobber is an all in one business app software which is where you can store customer information, send quotes and invoices, schedule your appointments, and even collect payments. Best of all, you know I talk about this a lot on the podcast. You can save a credit card on file for automatic and hassle free payments. No more awkward follow ups or lost money. You ready to simplify your business operations? Check the link in the show notes and use my special Jobber link and try it for free. You won't look back. Most jobs go to the first contractor that picks up the phone. But you can't answer the phone when you're on a lawnmower. So here's a solution. It's called Voice Assist by CallRail. I'm going to show you how it works. I'm going to call a pest control company that uses Voice Assist. Take a listen.

[Voice Assist Virtual Assistant (Betty)]

Hi, thanks for calling the pest patrol. I'm Betty, a virtual assistant. What's bugging you?

[Podcast Host / Interviewer]

Hey Betty, I wanted to see if you could schedule somebody to come out, take a look at my property and give me a quote from for pest control, I was looking for yearly service.

[Voice Assist Virtual Assistant (Betty)]

Sure, I can help with that. Do you have any questions about our services before we get started collecting some details.

[Podcast Host / Interviewer]

What would it cost to come once a quarter?

[Voice Assist Virtual Assistant (Betty)]

We offer a quarterly service plan with four treatments per year. The cost typically ranges from $350 to $480 annually. Keep in mind, final pricing depends on an in person evaluation.

[Podcast Host / Interviewer]

Yeah, let's get one scheduled.

[Voice Assist Virtual Assistant (Betty)]

Can I have your first and last name please?

[Podcast Host / Interviewer]

Paul Jamison.

[Voice Assist Virtual Assistant (Betty)]

I've got several openings. For example, on Thursday, March 19, we have 10am 10:30am, 11am and more throughout the afternoon. Would any of those work for you?

[Podcast Host / Interviewer]

Yeah, 10am Works.

[Voice Assist Virtual Assistant (Betty)]

Your appointment is confirmed for Thursday, March 19th at 10am and a confirmation email has been sent. Could you share the address of the location where you'd like the service?

[Podcast Host / Interviewer]

Sure. It's 1234 Main Street.

[Voice Assist Virtual Assistant (Betty)]

Is there anything else I can assist you with today?

[Podcast Host / Interviewer]

Oh, that's it. Thank you so much, Betty.

[Voice Assist Virtual Assistant (Betty)]

Thank you for your call.

[Podcast Host / Interviewer]

Well, did you hear that? That's CallRail's Voice Assist. It's so good it speaks for itself. You can qualify more leads, book more jobs and stop losing opportunities to businesses down the street. Try for free@voice assist.com Again, that's voice assist.com real quick before we move on. If you're tired of buying equipment blind or running your crew the same way, hoping something changes, get yourself to Equip exposition this October in Louisville. Test drive the best equipment from every major manufacturer in one place. Come see me at the morning show. Check out Equip's education sessions built for guys actually running crews. Use my code Paul at registration to save 50% on your pass. The link is in today's show Notes

[Jonathan Patosnik (JP)]

foreign.

[Podcast Host / Interviewer]

Let's unpack with JP Shared and I want to say thank you real quick to today's episode sponsors, Jobber and CallRail because they can really help us. Jobber with the CRM portion of dialing in these numbers and then call rail with the marketing perspective of knowing where our leads are coming from. So these are important tools that can help us track our business and really how things are going. So I highly recommend CallRail for your marketing, for your phone calls, and Jobber for your CRM. Well, let's talk about the copying the big guy strategy that JP mentions. And this is brilliant because a larger company in your area, I'm talking, they have their trucks wrapped up. They actually have like a large facility where they house all their mowers and power equipment and, and vehicles and all of that I've seen, I've been blessed to get to go to some really nice facilities of some of the larger landscaping companies. And some of them are just amazing, right? But these companies, they have office staff, right? There's a front desk lady, you know, Mary or Debbie or you know, she has a name like that. But this company, right, they're paying workers, computer, they're running a legitimate business and they have for years, right? You probably know of that company in your town. They're all, they're all over the United States. Well, what are they charging? Because they have to cover all that overhead. Like I'm not talking about they're brand new in business. I'm talking about they've been around for a while. So they have to cover the expenses for those wrapped trucks, for Mary in the office, for workers comp, insurance, all of that. The, the actual big building that they have, they have all their stuff in. So it's. If you can find out what that company is charging per yard of mulch installed, per bale of pine straw spread, per flat of flowers installed, per maintenance. That's a similar size yard that you have. Then copying that company's pricing is probably going to put you in a good position because you probably do not have all of that overhead quite yet. I mean, it's coming. We want to build our business so that when we do get to that point, we have the Money to pay all that overhead. But the dangerous thing that happens is solo operators, right? You're at the gas station, and there's Mario, and you're like, hey, man, what are you charging per bail? Pine straw or hey, hey, you know, hey, Steve, what. What are you guys doing over there? I said, you know, I saw you're cutting that yard over there. What you could. What y' all charging? You're like, they're. Oh, well, we're charging 40. 40 bucks. Okay.

[Jonathan Patosnik (JP)]

Yeah.

[Podcast Host / Interviewer]

And, you know, it's taking them an hour. Well, you're looking at the other company. Well, what do you. What are you charging? You know, like, the really big company that's legit, and it's harder to gather that information, but if you actually can figure it out, they'll be like, yeah, it's $72. 72. How'd you come up with 72? Well, that they know their numbers. So you literally on the same street, have a legitimate company. What I mean by legitimate is they have, you know, they're paying their workers comp. They're paying. They have an office lady or two or three or more. You know, like, they actually have people working there in so many different levels, not just people out there cutting grass. And they're charging $72 for the yard. And then you have the guy down the street trucking. The truck are staying in the van, and he's charging $40. I've seen this time and time and time again. So for your pricing, if you're going to copy one of the two, you want to copy the 72. And I'm just, I'm just throwing a random number out that might even be a little low. Like, let's. I'm just hypothetically saying Mrs. Jones yard takes $72 for an hour. That'd be $72 per man hour. And the other guy, who doesn't know what he's doing, he's like, oh, you know, it takes me an hour. I made $40 an hour. Better than work at a Walmart. Not understanding all of the overhead. Summarizing what JP had to share here is raise your prices. All right, Send your customer. I, I, I, I want to shout out. I have a price increase letter template that, that you can download off our website. It's depauljamison.com or actually just look in the show notes. You can email that template out. Just plug and play in their information. And then you could tell your customer, hey, we have to raise our prices. And the letter explains everything that needs absorbed. You Know, it just goes down the list of all the expenditures that we have to absorb.

[Jonathan Patosnik (JP)]

Right.

[Podcast Host / Interviewer]

Gas prices are going up. We have to absorb that. We want to continue to do a great job for you and continue to have the best team members, but all of that's costing us more money. So, you know, in order to absorb, that's my secret word. I mean, the letter is every. The price increase letter template is put together as a masterpiece. But if there's a one word you can actually remember from the letter, in case you have to talk to somebody in person, just remember the word absorb. And then let's say you're out on the front yard and Mary comes out, she's like, hey, I, you know, I got your email. You're going to raise the price to 72 starting next week. Don't get nervous. Just remember I listened to Paul in the Green street podcast. He's told me the word absorb. Absorb. Absorb. A B, S, O R B. Absorb. Yes, that's correct. Man. We, you know, we, we just need to absorb. Our, our costs are going up. Gas prices, the cost of what my team, you know, you know, I know you love, you know, Pookie over there working for us, but we, you know, we have to pay him more than we did last year and, and, you know, yada, yada, yada. You can go down the list of, I mean, just be honest. Like, I have to pay for all this stuff in order to absorb that. We have to raise our prices. So if, if the customer cancels because of the price hike, then replace them as. That's why I mentioned CallRail. Replace them with a new, premium, highly profitable client at your, at your appropriate new profitable rate. We should always be recruiting, we should always be marketing and bringing in new customers at the right price. And if we have old customers that are below average, it's time to raise their price and get it up to where it should be. So, anyway, I hope that this has helped you. I'm such an. I'm so thankful to, to Naylor for helping me become friends with Jonathan. We actually recorded this podcast at Jonathan's house, which has been, you know, it's just craziness. So I just shared a little portion of it with you on, on today's program. But we'll have more for our. From our conversation with JP with you. But he's my mentor. I've, I've learned so much from him and I just so deeply respect his business acumen and his passion for excellence in business. It's hard for me to put into words to have a friend like Jonathan to, you know, be able to go to his home and go out to dinner with him and hang out with him and learn from him. I just try to do the best I can to take everything I learned and, you know, somehow get it through these, this microphone airwaves into your business because this is the stuff that moves the needle. So anyway, thanks to JP for imparting all this stuff to us. We'll have more as a green industry podcast rolls on. But I wanted to share that clip with you because I think it's very, very powerful. It's very dangerous, my friend, if we take on more work at lousy prices, because now we have to do the work. But if we're not making money doing the work, we're like a rat in a wheel. So raise your prices. When you go out and quote a new job this week, give them a premium price. Take your current customers and raise their prices to a premium price. Let's get out there and earn some money and serve people well. Hope to catch you on the next episode. Thanks for listening.

[Paul Jamison]

Hey, it's Marty, producer of the Green Industry podcast. This episode is over, but check the episode notes for links to products and services that you heard about during the episode. And thanks for listening.

[Podcast Host / Interviewer]

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[Jonathan Patosnik (JP)]

Oh, no. We help people customize and save on

[Podcast Host / Interviewer]

car insurance with Liberty Mutual together. We're married. Me to a human, him to a bird. Yeah, the bird looks out of your league. Anyways, get a quote at libertymutual. Com or with your local agent. Liberty. Liberty. Liberty. Liberty.