How to Price Commercial Tree Service Contracts

Commercial contracts provide steady, predictable revenue for tree service companies. Property management companies, HOAs, municipalities, and commercial campuses all need ongoing tree maintenance. Here is how to price these jobs profitably.

Understand the Scope

Walk the entire property before you quote. Count and measure the trees. Note species, sizes, condition, and access. A property might have 200 trees, but if 150 of them are small ornamentals and 50 are large shade trees, your pricing strategy differs from a property with 200 large oaks.

Clarify what services are included. Most commercial contracts cover some combination of:

• Scheduled pruning (annual or biennial cycle)
• Dead, dying, and hazardous tree removal
• Storm damage response
• Stump grinding
• Pest and disease management
• New tree planting

Get this in writing. Ambiguity in scope is where contracts lose money.

Pricing Models

Per-tree pricing works well for pruning contracts. Assign a price to each tree based on size, species, and difficulty. Small ornamentals might be $50 to $100 per tree. Large shade trees might be $300 to $1,000 per tree. Total the per-tree prices for the annual contract value.

Time-and-materials pricing works for removal and storm work where the scope is unpredictable. Set your hourly crew rate and equipment charges in the contract, then bill actual time.

Fixed annual fee is preferred by property managers who want predictable budgets. You estimate the total annual work, add a contingency buffer (10 to 15 percent), and quote a flat annual number paid monthly or quarterly.

Do Not Undercut Yourself

Commercial clients often request multiple bids. The temptation is to sharpen your pencil to win the contract. Resist the urge to cut too deep. A commercial contract you lose money on is worse than no contract at all because it ties up your crew and prevents them from doing profitable work.

Calculate your breakeven cost for the contract and add your target margin. If the number is too high for the client, walk away. There will be other opportunities.

Contract Terms to Include

• Payment terms (net 30 is standard for commercial)
• Scope of work with clear boundaries
• Emergency response requirements and response time commitments
• Insurance requirements and certificate of insurance
• Contract duration and renewal terms
• Price escalation clause (tie annual increases to CPI or a fixed percentage)
• Termination clause for both parties

Sources and Further Reading

• • International Society of Arboriculture (ISA): Professional standards, certification requirements, and best practices for commercial tree care operations
• • Tree Care Industry Association (TCIA): Industry benchmarking data, safety standards, and business management resources for tree service contractors
• • U.S. Small Business Administration: Guidelines for contract pricing, business cost analysis, and competitive bidding strategies
• • University of Georgia Cooperative Extension: Research on tree maintenance costs, regional pricing factors, and commercial landscape management practices

Try These Free Tools

Put these insights into practice with our free calculators and planners:

• Crew Scheduling Generator
• Equipment Maintenance Schedule
• Customer Estimate Builder
• Tree Health Assessment Checklist