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woodardsh
08-26-2012, 12:12 AM
Needing some help,
I have had my company up and running for two years but I know I am not doing it the right way when it comes to putting money back into the business. My question is how much should go back into the business for employees, fuel,equipment upkeep, etc. vs owner bring home? 50% business 50% owner, or what? Thank you for the advice!!

CHEESE2009
08-26-2012, 01:42 PM
Needing some help,
I have had my company up and running for two years but I know I am not doing it the right way when it comes to putting money back into the business. My question is how much should go back into the business for employees, fuel,equipment upkeep, etc. vs owner bring home? 50% business 50% owner, or what? Thank you for the advice!!



You shouldn't have to put money into the company unless it's coming from your clients.

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Before you can decide where your money goes, you have to find out how much money you actually have when a client pays you.

Total Cost - Subtotal = TAX.
$114.97 - $100 = $14.97

The tax your clients pay to you, is not yours to spend. In the example above, $14.97 is owed to the government, whereas $100 is mine!

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As for splitting the money, there are things to consider:

1. You must be able to afford expenses (excluding employees). Gas, repairs, new purchases.

2. You can pay your employees what your business can afford after general expenses, but don't go crazy.


I'm starving, brb homie.

dpld
08-26-2012, 06:56 PM
when you start a business you have to not only allow for day to day operating costs you also need to anticipate and allocate for future expenses and accumulate money.

without money you don't have a business and you don't split the cost you give yourself a salary.
if your business can not afford to give you a salary but can manage the other day to day expenses then you need to get a second job to make up for the shortfalls.

i don't mean to disrespect you but to be totally honest, to ask such a question it appears that you don't have much of a business plan to begin with.

you might want to do a search on creating a business plan and you will be able to find more details and exactly what is involved in a true business plan.

if you plan on making a long term career out of it and you want to be successful it would be in your best interest to put a good effort forward towards a real solid plan to assure you long term success.

it is your lively hood after all and you need to dot your I's and cross your T's and leave no stone unturned.

to be 100% truthful, after 23 years in business and having success i can say that all the things i once thought were critical to my business being a success was actually all wrong or i should at least say, the wrong order.

managing your business at every level and knowing how to manage it correctly will be the biggest factor in how successful you are.

sure, doing a good job and being fair priced and reliable help and have a part in it but no matter how good you are and how much work you get your business will only be as good as it is ran.
the work you do in the field does not translate and help you from the managing standpoint.

i guess it all depends on what you view as a success and what your happy getting out of it.
if you want to build a big money making machine that exceeds every year what it did in the prior year and strive and set goals to constantly grow and expand then that is running a business and requires a solid plan.
if your talking waking up everyday and riding a lawnmower till you retire and making a good living on your own but not getting rich so you can say you are your own boss then you are really more or less running giving yourself a job and took over the role and burden of keeping yourself busy.

i don't think the term putting money back into your business is really the correct terminology as well as if you were ever really doing that you would already be in trouble.

you are not so much as putting money back into as you will actually be having a surplus of money from meeting your sales goals week after week and by doing so you are able to meet all the costs of doing business and giving yourself a modest salary and then still have a substantial amount of money left over to serve as cash flow and making improvements or just sit and grow.

Steve
08-27-2012, 03:23 PM
I have had my company up and running for two years but I know I am not doing it the right way when it comes to putting money back into the business.

Give us some insight as to what is going on? Why do you feel that you are not doing it right?

woodardsh
09-07-2012, 02:10 PM
First, thank you all for the replies I have read them and will try and learn from your advice.

Second, I do not have any business plan at the moment my concept was to create a business that made good money and then hopefully great money. I am a first generation business owner and have came from nothing so I didn't fully understand how to get started.

Right now as my business sits I invested $30,000 into the business. I bought everything out right so I have no overhead other than expenses and if I use helpers for a day job. I carry between 50-75 yards a month and have been pushing door to door everyday trying to grow this company with everything in me.

The issue that I am having is I had $5,000 in funds and over the last two years I have not done a great job at taking a salary or putting money back to save for equipment or anything. SO now I am looking for advice on how to organize the income side that would be in the best interest of my business and myself. I make between $3,500 - $6,500 a month after expenses $1,700 - $4,500.

Steve
09-10-2012, 01:04 PM
You are bringing up a lot of good points.

Right now as my business sits I invested $30,000 into the business. I bought everything out right so I have no overhead other than expenses

What is interesting about this is no matter what you always have expenses. As soon as you take a step outside to perform some sort of job, the expense meter is ticking.

Whether or not anything is bought outright, there are always going to be expenses to maintain and ultimately replace.

Now that you look back on this choice, would you rather have spent less money to get started and kept some of that $30,000 still in the bank as a reserve to get you through any unforeseen issues?

I make between $3,500 - $6,500 a month after expenses $1,700 - $4,500.
How much of that are you able to stick into the bank and save each month on average?

Have you figured out how much you are making in profit per hour?

Most new start ups underbid jobs and that is why they don't make any money. Do you feel it is possible you are underbidding jobs now?

pfreeman
09-10-2012, 02:29 PM
I like this thread. Not many of us on here have the balls to admit we're not doing something right. There are several questions that need to be asked:

What is my actual cost per hour?
What is my expected return on my investment?
How much do I need to save to replace or upgrade my equipment?
What are my business goals? 3 mo., 6 mo., 1 yr., 3 yr., 5 yr.,
How do I get there?
As you start to answer these questions, a roadmap will develop. Hope that helps.

baileysgreenthumb
09-17-2012, 01:16 PM
This is my First year in the business and very busy since I opened it. Here in the pacific northwest its slowing down as we head into fall then winter and no one wants to water grass. So my mowing jobs are almost at a hault. I do a decent amount of yard clean ups so those help out so far.

What can you succesfully established Maintenace guys add to a business plan. I'm trying to learn as much as I can and would like the good guys advice to the road ahead. I read alot in these forums and they help out alot of us in our success. Share the love!

Steve
09-18-2012, 12:13 PM
Could you offer irrigation blow outs for winter? Where you clear all the water out of a home owners underground irrigation pipes?

baileysgreenthumb
09-19-2012, 12:24 PM
Steve, No one waters and no one uses irrigation. I only have 1 customer who has underground sprinklers. On the Pennisula when its not summer you never need to water. Summer time all the earth friendly people dont want to use water, they say its a waste.

This started to happen late August the grass is pretty much dormant. This is a learning experience for me and good thing I have clean ups still coming in or I'd be on my keester. I also just started to advertise again. I stopped because because i was so busy I couldnt keep up. All grass customers. Know I know they dont pay out all year.

Any advice guys???