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  • How do you Operate Your Lawn Care Business

    Hey everyone,
    So I made it through my first season, and it was a great learning experience with alot still to learn. I saved every penny and made enough money to purchase a new trailer and enough cash to start a marketing campaign for this upcoming season.
    Basically my question is this, how do you seasoned business owners currently operate your business? Specificially, are you out there cutting or are you paying employees? If your paying employees, what is standard wage in this business if we just focus on maintenance (cutting, trimming, clean up, fert application) ? If you are running the business and having employees do your flyering, cutting, and maintaining of accounts what kind of profit margin do you expect from each account serviced. I understand this is different for everybody, I am just trying to see what is reasonable in the industry.
    What I am trying to do here, is solely create and operate the efficiency of the business, If I have to get out there and cut a lawn thats ok; but, I am really trying to learn to be the one that is operating the business in the background while employing one or two people to maintain the accounts.
    Here is my gameplan: instead of putting money into all this expensive equipment, I want to hire Independent contractors to do my flyering and marketing (I will provide the material) I will pay each of my marketeers for the leads they obtain that are closed for servicing by me. Upon, gaining the accounts, I want to hire IC's to do the servicing of the lawns and have them use their own equipment. I figure that some people out there dont know how to get leads or close accounts, and with my sales background thats what I know I am good at; I can pay them as an IC to do the servicing and because I provided the work, and they will be under my business umbrella, that I can make a small percentage of each servicing.
    Now, I know this is possible and can work great with the right implementation, I am just eager to hear from the more seasoned owners, am I on the right track in terms of operating my business as an entrepreunuer. I learned that there is three type of business owners: the guy who wants to work IN his business, the guy who wants to do some of the labor and then use other days to work ON the business, and then there are just guys who solely want to work ON the business for growth. I want to be number three. Any insight would be very helpful, thanks alot to each and everyone of you.

    Chris

  • #2
    no offense, but you are pipe dreaming.
    the profit margin in this industry is too tight to pay people to do everything for you all while you live the good life.

    i got a 23 year head start on you and my business is doing very well and the day i start focusing on living the good life instead of being actively involved in day to day operations it will be the day my business starts going backwards and eventually folds.

    what are you gonna do, get a lawn for 35.00 per cut and find a sub to do it for 25.00? wow thats a 10 dollar profit and if you do that a 100 times you will have a whopping 1,000 dollars. but wait i forgot to deduct the cost of marketing and insurance.

    i am not trying to mock or insult you, i am just being honest and the landscape industry is not the business for those who think they are gonna corner the market and sit back and collect the riches off of other peoples effort.

    i know where you are coming from and there really is some professions out there where you can do well as a middle man but landscaping is not one of them.

    sounds like what you want to do is similar to the franchise " the lawn guys" or otherwise known as "the lawn pimps" which won't be around too much longer after they have screwed enough landscapers, just like service majic.

    Comment


    • #3
      To many factors that would make this not work.

      1. the best marketing is good work that leads to word of mouth referrals. Theres no guarantee that the IC will work this good and if the neighbors do ask for a estimate from them, you may never no about it. Same thing with up sells there going to ask the guy thats currently cutting the lawn about a fall clean up. Not the number on the card.

      2. You would have to charge more to make a profit. With the amount of lowballers out there it will be hard to get jobs. The IC if they are equipped know they can get $35 for the lawn you pay them $25 for.

      3. Since your only making a few dollars of every cut. You would need lots of sales. Not easy to do with high prices and shady work.

      The only real way this would work is with a lot of clients. Even then its just dumb. You can pay a worker $10 a hour to go do 20 lawns that net $700. After paying your employee you would have over $600.

      Comment


      • #4
        Thanks for setting me straight

        I appreciate the insight gentlemen. This is what I was looking for. I know it was a long shot, and I am just trying to think bigger than normal. No offense taken by any means, and I appreciate the honesty and setting me straight. Allow me to ask this, at what point is hiring an extra man a good idea (I know this depends on the business/person) and what do you guys pay your guys to assist you while servicing a lawn that your charging 35 bucks on. Thanks !

        Chris

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        • #5
          the only thing you need to focus on is just getting more clients and keep your nose to the grind stone after a while you will be able have hired help to do the grunt work.

          Comment


          • #6
            Hi Chris,

            This forum is littered with the wreckage of those who had tried this. Both as the owner as well as stories from the 'independent contractors' who worked for them.

            What we have seen is these businesses end up not really following the IRS rules for what an independent contractor is. The workers end up getting fired, not paid, disgruntled about it or what ever and then contact the IRS to contest their independent contractor status. That is when you as the business owner find yourself wishing you never skirted the rules on this.

            Trying to hire independent contractors to distribute your marketing material, more often than not ends up with them maybe handing out a few flyers and then throwing the rest out.

            You have to keep in mind, human nature is human nature. No matter what you label someone (employee, contractor, whatever) if you want them to produce, you have to monitor output or you are going to be blind as to what the real results of their and your efforts are.

            Then on top of all of that, YOU are not learning all the ins and outs of the business when you take the route of trying to do it all with contractors. You are cheating yourself out of a wonderful time to educate yourself on all the intricacies of the business. The only way you are ever going to do great at any business is by knowing it and understanding it through and through.

            Don't try and cheat yourself out of this great time to learn or one day you may find that 20 years has passed you by and you wonder what you did with it.
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            • #7
              Steve makes some great points too.

              I would have no idea how to bid if I didnt have first hand knowledge of the work myself. I never send someone to do a job that I havent done before. If it takes me 3 hours to do a route then they say it took 5, I know there full of ****. Even employees who dont have the right equipment will cut your throat when the opportunities present itself. So it will be worst when the person does have the equipment.

              Dont get me wrong though this could work with snow removal. You just have to make sure that if the person doesnt show you can cover it. The nationals do this like Brickman and USM. They also have the worst reputation in the business with contractors.

              Comment


              • #8
                When I was out of work and still debating whether or not to start a lawn care business, a guy I know wanted to hire me. (lawn care)
                He found that it would be too expensive to hire me on as an employee, BUT he could hire me as a subcontractor.

                (me scratching head) Wouldn't it make more sense to do this on my OWN? I mean, if I have to become my own business with insurance and whatnot in order for him to use me as a subcontractor, WHY work and give him a cut of it when I can just keep it for myself?

                Ta-da! Here I am.



                Note that he DOES do some of that "consultant" stuff now - finds people job leads and takes a cut of it, but I don't see it as a big money maker.

                Comment


                • #9
                  Chris,cthis is perfect timing. I just went to an estimating seminar yesterday and I will discuss that in a minute.
                  Years ago I had 9 full time employees and a thriving business I built from the ground up. During my second year I took on a partner and hired some of his friends, one of which ran my maint crew whom I gave a company truck and gas card. About half way through that year I started seeing charges on my gas card from other neighboring states. I confronted him and he said I didn't know that I couldn't use it for road trips. Road trips to other states with my truck? Are you fu@$ing kidding me? A week later after firing him I did the mowing route and had neighbors asking me why I wasn't cutting their lawn today. These were people he was mowing on the side. Nice!!! Since then I scaled way back to myself and however many people I can fit into my truck with me. The estimating seminar I went to yesterday helped me confirm that my 25% profit margin I made last year is where I need to be. I am on every job, and some weeks working 7 days. My customers love seeing me and knowing I take personal intrest in their property. I have been doing this since I was 14 yrs old. That's 34 years. Yes I am 48 and love this business! I start laborers at $ 11-12 per hour based on experience. Hope this helps.
                  Jim

                  Comment


                  • #10
                    Since then I scaled way back to myself and however many people I can fit into my truck with me.
                    Jim,

                    After going through that experience do you have any advice as to how to avoid such pitfalls? If you were to grow to that size again, would you do anything differently?
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                    • #11
                      Chris,cthis is perfect timing. I just went to an estimating seminar yesterday and I will discuss that in a minute.
                      Years ago I had 9 full time employees and a thriving business I built from the ground up. During my second year I took on a partner and hired some of his friends, one of which ran my maint crew whom I gave a company truck and gas card. About half way through that year I started seeing charges on my gas card from other neighboring states. I confronted him and he said I didn't know that I couldn't use it for road trips. Road trips to other states with my truck? Are you fu@$ing kidding me? A week later after firing him I did the mowing route and had neighbors asking me why I wasn't cutting their lawn today. These were people he was mowing on the side. Nice!!! Since then I scaled way back to myself and however many people I can fit into my truck with me. The estimating seminar I went to yesterday helped me confirm that my 25% profit margin I made last year is where I need to be. I am on every job, and some weeks working 7 days. My customers love seeing me and knowing I take personal intrest in their property. I have been doing this since I was 14 yrs old. That's 34 years. Yes I am 48 and love this business! I start laborers at $ 11-12 per hour based on experience. Hope this helps.
                      Jim


                      it is funny reading your post and as i do i see myself. i am 45 years old and have been doing it for as it seems forever.
                      i had guys going all over the place and thought i had good guys in place to count on getting stuff done and not having to be watched like infants.

                      it was good for a while but eventually given the chance coupled with other crappy workers they can get tainted and start off on the path of screwing you blind.

                      now i do all commercial properties and i just have what i would call a super crew with 7 guys including myself and we all go around together with the two service vehicles and all the fixings.
                      this way i am on the job and being that the jobs are big we bang them out faster and move on to the next.
                      i work right along with them and if i got some office work to do i can take a hour and sit in the truck and do what i got to do.
                      one of the things i like in this day and age is the ease of a mobile office, i have everything i need and with my android phone setup i can do everything paperless as well as send it right to the office into the mother ship.

                      i rarely have to deal with much during the day and when i do it usually is a few quick calls and back to work.
                      when i changed direction a few years back my goal was to make as much money as possible with the fewest customers which is why i do commercial.
                      i only got to deal with 10 bills for 10 clients in 10 different locations its like my hermain cain 10-10-10- plan (not really). i must say they are 10 large properties so its not easy by any stretch but all i have to focus on each year is keep those 10 clients happy as a clam and always keep the feelers out for next year on other accounts in case you get low balled and lose one. but being i deal with management co's they take care of most of that for me so i never really have to deal with customers and phone calls too much.

                      when i used to be all residental i had 120 accounts and OMG the crap on a daily basis i had to deal with from people who thought because they paid me a couple hundred bucks each month that i was responsible for all the wrong in the world.
                      the phone calls and constant clammer from these people and the billing was horrible and some paid right away and some took weeks and you always kept number totals like what i made this month and how much of what i actually made that i have in hand amount and the what is still owed to me in the past due amount.

                      its hard and it took a long time but at this point in the game i can not be bothered sucking up to someone for a couple hundred bucks a month and deal with their stories and complaints.
                      for the rare occassion i have to meet with a client that pays me 9 G wizzes each month over a issue or concern i find it no problem having to grease his carrot.

                      as they say money talks.

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                      • #12
                        it was good for a while but eventually given the chance coupled with other crappy workers they can get tainted and start off on the path of screwing you blind.
                        What kind of issues did you see that others should look out for when they turn their employees loose?
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                        • #13
                          Steve, to answer your questions. If I ever wanted to grow, which I do NOT.
                          I would do strict background checks including credit and drug testing with a zero tolerance.
                          Next a thorough employee manual including the ability to fire someone even if they looked at me the wrong way.
                          Lastly I would find out just how I would be able to legally discriminate against having to hire someone I did not think would be a good fit. Honestly I hate visible tattoos, and piercings of any kind on guys. Why would you put those hideous black fender washers in your ears? Or take the chance of chipping a tooth with a tongue piercing?
                          We work with great clients, some older and some younger and non of them have any of these things.
                          I would store fuel at my location or do all of the fueling myself. I have had gas stolen in the past.
                          Let's see what else, no more company trucks to take home. No lending of tools.
                          Like I said it is hard to say what I would do if I grew because I refuse.
                          Jim

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                          • #14
                            What kind of issues did you see that others should look out for when they turn their employees loose?
                            things are a little different now because of the changes i made by having all my workers with me during the day instead of being divided up so that helps a lot.

                            but i found that when i had two brothers working for me it was a little difficult at times.
                            the younger brother was the actual landscaper and had a good deal of experience and he got his older bro a job and some of the problems i had was the younger brother had a problem telling his older brother what to do and when to do it.
                            i had times when i would insruct them where i wanted them to start the day and end up, basicly a planned route so i could know where they were as well as the route was set up like a big loop with no back tracking to save time as well as mileage on the truck.
                            well, the older brother would to some degree bully his younger brother with the family senority and decide, " lets go this way so i can stop and get lunch " and completely screw up the route and make tracking them down difficult.

                            i find it is very important for your employee's to get along and have a good relationship but at the same time too much of a good thing can be a problem.

                            there are so many things that can be a problem as well as every situation is different so it is hard to rattle off a list of things to look out for because i have seen brothers work well together so the two clowns that worked for me do not represent all related employees.

                            i had one dude that worked for me as a foreman and for the first 3 weeks he did well and after that his days slowly got longer and longer with the same route.
                            it was late spring so the grass was still growing fast and it also coincided with a fert app from a few weeks prior so with the bagging it took longer which was expected and believable.

                            but then we got into july and some home owners ( when i still serviced home owners ) were asking to take a week off because the grass slowed down and this dude was still coming in with a hr extra each day and that is when the BS started to flow.
                            his excuses where, the mower was giving me trouble and the truck was running funny and the string trimmer died and i fixed it.
                            it got to the point that every day it was something.
                            keep in mind that i was sending this dude out in a brand new set up it was like three months old when he started.
                            the truck, trailer, two riders, one walk behind, 3 trimmers and 2 back packs and everything else was brand new.
                            at first i gave it the benefit of the doubt because i have bought new things in the past that gave me trouble but every dam thing in the set up was brand new and according to him it was giving him trouble.

                            i knew he was playing games and before i jumped to conclusions i had my trucks set up with the gps tracking and none of them knew about it.

                            well, as it turns out they were going to his house everyday for lunch 3 towns away from the closest job and once a week he was actually cutting his lawn while he was there.
                            he also had a little side gig with about ten lawns that he was mixing in with my route.

                            but in the end i had him and 2 laborers stiffing me out of 2 hrs a day X 3 guys X 5 days a week plus fuel for the cuts on the side and the out of the way driving plus they were sand bagging my jobs to get them done quicker to have more time for themselves and the side work.

                            i kept a log of all the addresses he was servicing with the dates and times as well as extended lunch breaks at his house and with the gps i could also tally the mileage.
                            i decided that tomorrow which was friday i would let them finish the route for the week as well as it was pay day and at the end of the day i would send them packing and then give myself the weekend to forget about it and get back to the grind on monday.

                            what was even more bizzar and coincidental was i saw a new stop on his route, a place he never went to before and he was there a while so i was really curious as to what they were doing and i got in the truck and zipped over to where they were and he actually had the balls to unhook my trailer and leave it at one of my customers houses and take the dump truck and go get mulch and do a mulch job.

                            i was like, that's it. i pulled into the driveway and got out of the truck and calmly walked up and said, make sure you hurry and get this finished and go back and get my trailer where you left it and make sure everything, i mean everything is done before you come back, and don't come back if it is not done.
                            and then i left.

                            come 5:00 they came back all quiet and with those long azzed sorry faces and being that i pay every two weeks and it was friday i told them i would give them their checks and that i would file charges against them for stealing my equipment and truck. the one guy said, your gonna do that for doing a mulch job on the side? then i slapped the log of everywhere they been the last 6 weeks on the desk and said, and for this too.

                            you want to talk about seeing 3 guys turn white as a ghost in 2.5 seconds. they were floored.
                            so i totaled up what they made with my stuff over the six weeks period includeing the mulch job and deducted the hours i would have paid them and they still owed me more money then they each had coming from their 2 week paychecks .

                            so i said, you forefit your 2 weeks paycheck right here and now and walk away with no job and no money and i won't call the cops on each of your azzes or you can take your checks now and still have no job and we can settle the rest in the peoples court.

                            they chose to cut their losses and run but it is amazeing how you can have 2 guys work for you for a season and they were fine and good and then i add one bad apple and he corrupted them and in the end cost them all their jobs.

                            my only advice would be don't think it can not happen to you and never say never.

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                            • #15
                              That is an amazing story and it gives a great heads up of things you gotta watch out for.

                              when i used to be all residental i had 120 accounts and OMG the crap on a daily basis i had to deal with from people who thought because they paid me a couple hundred bucks each month that i was responsible for all the wrong in the world.
                              This is another great point you made that I think effects A LOT of newer lawn care business owners. So often we hear stories on here of lawn care business owners banging their heads against the wall because thy have such a difficult time dealing with their customer base. Maybe instead of dealing with a group of problem customers, they should consider going the route you took.

                              Ultimately would you say it's up to the business owner to find the type of client base that will work best for them?
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