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Starting a lawn care business. How to start a lawn mowing business, lawn care business, or landscaping business. If you are starting a lawn care business, ask your questions here.

Decision making time


Starting a lawn care business.

How to start a lawn mowing business, lawn care business, or landscaping business. If you are starting a lawn care business, ask your questions here.
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  #1  
Old 02-17-2010, 01:15 PM
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Default Decision making time

Ok so I just got done with my taxes, I'm a little disappointed but oh well. A lot of things I thought I could get away with I can not such as writing a personal lone from myself to my business, Thats a big no no so for those of you that are planning on doing that don't bother. Anyway My numbers were rather sad. I went in Saturday to the tax person almost $200 in the red. This was my first year so this much was expected but after making the adjustments I ended up just under $800 in the black. Bad bad move because now I owe the state $207 but oh well. Now it is decision making time. Was it really all worth it? I am not really sure. I am a bit lost on it right now. Do I continue this year in hopes business will be better or just cave in and keep my 9-5? I mean $800 revenue for the year wont even pay my headlight replacement bill LOL Whats everyone's thoughts on this?
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Old 02-17-2010, 01:26 PM
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Depends on if you love what you do or not. plus if you pull through this economy with ur business still in tact you will be that much stronger when things look up. I dont know just my 2 cent and Im finally starting mine.
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Old 02-17-2010, 01:57 PM
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Originally Posted by MountainViewGreenskeeper View Post
Depends on if you love what you do or not. plus if you pull through this economy with ur business still in tact you will be that much stronger when things look up. I dont know just my 2 cent and Im finally starting mine.
I am not sure if I really enjoy the work but I do enjoy working for myself. As far as pulling through I tend to agree. Recessions make millionaires for those who are able to hold on and invest there money and stay the course but A problem I have is knowing how things work and I know at least in this area lawn care is not a million dollar business and I wander if its worth it to continue investing my private funds into something that may not make it anyway. I mean we all know its anyone's guess. A business can fold in the blink of an eye in this environment and should mine fold then I am out everything I put in, sure I have some nice equipment to care for my own yard but the cash money interests me more than having nice equipment for my yard. Under normal circumstances things should start to be more self dependent in one year which I am approaching, I started in June of last year. Maybe just maybe I will give this until the end of 2010 and then jump ship if my numbers don't significantly improve.
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Old 02-17-2010, 02:13 PM
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I went in Saturday to the tax person almost $200 in the red.
As you look back over last year and analyze it, what is your view on why this was the case?
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Old 02-17-2010, 02:15 PM
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Under normal circumstances things should start to be more self dependent in one year which I am approaching, I started in June of last year. Maybe just maybe I will give this until the end of 2010 and then jump ship if my numbers don't significantly improve.
Sounds like you already know what you want to do then. witch is good cause I would hate to hear of someone jumping ship in the same business im tryn to get into. my cusin does more install but but still sad to hear people leaven the industry.
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Old 02-17-2010, 02:17 PM
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As you look back over last year and analyze it, what is your view on why this was the case?
Steve. The biggest thing was the personal load I wrote to the company for equipment purchase. Once we deducted all the payments from the finances it put me almost $800 in the black. Being in the black is good but 80,000 in the black would have been better.
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Old 02-17-2010, 02:27 PM
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Sounds like you already know what you want to do then. witch is good cause I would hate to hear of someone jumping ship in the same business im tryn to get into. my cusin does more install but but still sad to hear people leaven the industry.
Trust me this business is nothing like I expected it to be, No way near as profitable and way way WAY more competitive. I did this work when I was 12yo and I knew going into this the cost for professional services has gone way up, I now get $50 for mowing a lawn where as at 12yo I got maybe $10 still with that you factor in a $3,000 truck, about $8,000 in equipment and retard that will scalp a lawn for $2 and its so very hard to put a dent in those initial $11,000 or so bucks to get started. Droping that much is not necessary but its the rout I took, I am starting to wish I stayed more conservative until I know where I stood. Now if I bail on it I have 11K of a truck and equipment I will most likely never use. This is not my first rodeo so I know how the business world works but I was amazed at how many things can just blind side you in this business. Must watch your butt at all times and never underestimate how powerful organization and a good filing system are. I know I had much more I could have claimed agents my profits that could have offset the entire tax bill for this year but I was horable at organizing things. For example I can wright off the hours my weed eater and all my other equipment was in use on top of the cost of the equipment. Lucky for me I keep a tally of hours for the oil change schedule but its little stuff like that that we don't realize. I mean do you really know exactly how many hours you ran your weed whacker last year? Cant be an even number ether or the IRS will assume its a guess and audit you. I can not believe how many tax laws are agents small business but at the same time if you keep awesome records and know the system you can take the IRS to the bank during tax time. A good example is we only brought in 86K last year but had 51K in wright offs bringing our taxable income to 35K That part was awesome. We made 86K but only paid taxes on that of someone making minimum wage.
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Old 02-18-2010, 07:15 AM
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This is not my first rodeo so I know how the business world works but I was amazed at how many things can just blind side you in this business.
What other things did you feel blind sided you? I am sure a lot of member who havent gotten started yet are reading this and now thinking about all these issues.

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A good example is we only brought in 86K last year but had 51K in wright offs bringing our taxable income to 35K That part was awesome.
It sounds like in the bigger picture you took in a good amount of money. Is there any possibility you could cut back on expenses this year to improve your income?
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Old 02-18-2010, 10:52 AM
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What other things did you feel blind sided you? I am sure a lot of member who havent gotten started yet are reading this and now thinking about all these issues.



It sounds like in the bigger picture you took in a good amount of money. Is there any possibility you could cut back on expenses this year to improve your income?
Steve as far as my income, I was actually 20K short but only 800 of that was from lawn care. I have many sources of income so $85,700 of that was not from lawn care. As far as things that blind sighted me hmmm let me think, this is a good one. Ok first off my truck. You remember my last rig? I know you do because you used it in an add LOL When my vehicles started dieing on me I had to do something. I had a car but nothing to haul equipment with so it was ether lose my clients and toss away all that hard work or go shopping. 3K later I have my truck. That was a huge unexpected expense albeit a great deal I got. Another one would have to be the jackass clients. We all get them. If you haven't yet you will. I will be damned if I am going to mow a law for $5 just not happening and the fixed income old timers kinda run you into the ground when they here it will cost them $100 per monthly or more. I almost jumped ship because one of these you may remember. Another good thing back to the equipment expense is like me most of us start out with the equipment we already have and use on our yards. Those old mowers work great but once you start over heating them on tall lawns several times a day they will cave in fast. I lost a mower and WW back to back so that sucked up another $400. Remember if you don't have the cash to replace the equipment then you are out of business. I had a great client who allowed the use of there mower when mine broke to finish there lawn. This was good but it was there very first service and looked way bad for me as a business owner. Another good one is I was hired to cut a fire break, the client had piles of limbs all over his property, he needed them shredded, I gave an estimate which he agreed to and said he would call me before the weekend to schedule it. I rushed out and spent a small fortune on a shredder and equipment and all and never got the call. I purchased the shredder used and it only worked one time in my yard and still sits out in the bone yard broken so now I have a broken shredder and never made a dime. Its really hard to list everything. The best advice I can give is just sit and think of anything that can go wrong and bet your butt it will go wrong. Plan for it all to go wrong and have a drink when it doesn't. I didn't plan on anything going wrong but thank god I have money to spare to get me out of these situations.
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Old 02-18-2010, 11:22 AM
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Default profits

at $50 average lawn, sounds to me like you should be making good profit. I think, (an accountant's opinion) your expenses are too high. And remember, the first year or two of starting a business (in general) show the least amount of net profit due to the start up costs. Once they are paid off, you will be left with basically all profits because, like you found out, you can write off the usage of your equipment as depreciation.

It doesn't necessarily have to be hours used. lets say you have a trimmer you bought for $200 and you plan to use it for 5 years until it's unusable and worth $0. Then you could deduct $40 each year. But if you do have a timer or can log your hours, then it is easier. lets say you have a mower you can use for 1000 hours before it's worth $0 and you paid $10000 for it. then you could deduct $10 per hour used. (figurative numbers)

Talk to your accountant and run over your numbers. he can help you decide if it is a good investment or not. If your company cleared $800 this year out of the $1100 you invested (800/11000=7.27%) 7.27% is not a bad return on investment if you consider what the banks are paying to have your money sitting there. Of course this also depends on how much you paid yourself.
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