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2013 plan...figuring the numbers


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 08-23-2012, 09:43 AM
t-10yrs2retire t-10yrs2retire is offline
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Default 2013 plan...figuring the numbers

2013 plan....Any input from the seasoned guys???

OK I have had a few pitfalls this year (my first year) that will leave me going into next year in the hole about $2000. I started this in May with one lawn and now have 6. I took a couple over from a friend of a friend at what he was charging and they are low but I agreed to finish them out this year but will send new quotes out for 2013 probably October or November. I was on track to break even this month till a leg injury put me out of work at my main job till October. I kept things small and manageable this year and glad I did and this was not devastating!!!

I was going through several sections of the board and trying to figure out where I wanted to be by the end of next year and how I was going to get there. There were several good articles there and one sentence out of all of it stuck in my mind. Plan and budget as if you were running where you want to be. Think thatís what it said anyway......So I started listing out where I wanted to be. I have for this purpose 3 days off one week and 2 days off the next (Its actually 4/3 but left time for family and overflow work) so for the 3/2 with about 26 mowing weeks is about 520hrs/yr. Take about 25% of that out for travel and it leaves me with about 390 actual working hours per year that I have.

Next I listed out what hypothetical and actual expenses and equipment (+cost) I wanted to be at on Jan 1st 2013. Ones with a * were what I thought were hard numbers and couldnít be lowered or changed. If anything would maybe be higher. This will be in 2 groups the WANT first and the NEED second. most is USED stuff

WANT:
Truck..................$10000
Trailer....................3000
ZRT mower..............5000
edger.......................250*
back pack blower.......250*
Insurance liab/equ....1000*
Advertising...............200
equipment maint.......1000*
Misc operating/fuel....1000*
roll over cost 2012....2000*

TOTAL................$23,700/390hryr = $59/hr

Now the way I have been figuring my quote has been to figure out how long it took me to mow 40,000sqft with moderate trimming and what I wanted to make an hour and I came up with a price per sq/ft of $.00115 so 40,000 x .00115 = $46.

I asked myself what I thought this area could handle from a part time guy who is serious as a heart attack and does a good job. (ME ) I had a guy charge me $35 to do about 4000sqft once. (my front yard and was over grown last year.) So I donít think $50-60/40000 would be too high or low balling in this area.

SOOOOOOO....if I want to pay cash and at a min break even by my last mow of 2013 here is my NEED list.

NEED:
Truck..................$5000
Trailer....................2000
ZRT mower..............2000
edger.......................250*
back pack blower.......250*
Insurance liab/equ....1000*
Advertising...............200
equipment maint.......1000*
Misc operating/fuel....1000*
roll over cost 2012....2000*

TOTAL ..................$14,700/390hryr = aprx$38/hr

I will continue to use $50/40000 it seems on par and that way I have some cushion, i'm sure some of my est are off such as insurance I think is low. The 6 lawns I have now when I do all of them on the same day take me 7hrs. so I will be working at filling 17 more hours/ week to make this work. At the $38 this only covers expenses.

These are a short term goal for the end of next year. I would have to readjust for my 5 year goal (2016) Newer truck, plow, sure I will need a mower or two in there somewhere.

Thanks for any input.
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  #2  
Old 08-23-2012, 01:07 PM
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First off, what do you feel went wrong this year that you are going to try and fix next year?

Second,
Quote:
WANT:
Truck..................$10000
Trailer....................3000
ZRT mower..............5000
edger.......................250*
back pack blower.......250*
Insurance liab/equ....1000*
Advertising...............200
equipment maint.......1000*
Misc operating/fuel....1000*
roll over cost 2012....2000*

TOTAL................$23,700/390hryr = $59/hr
Where is your profit? What do you need to profit in order that you can build up enough cash to go full time with your lawn care business and then hopefully be able to drop your hourly operating costs.
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Old 08-23-2012, 01:38 PM
stevef1201 stevef1201 is offline
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Here 1 acre 43000SF gets about 65 a cut. depending on where you live and work that mioght be low. To get an ides of what you should be charging get a friend to call 3 local companies for quotes for his yard. If your not charging 50 per hour you are gonna lose your ***
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Old 08-23-2012, 07:26 PM
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Quote:
Originally Posted by stevef1201 View Post
Here 1 acre 43000SF gets about 65 a cut. depending on where you live and work that mioght be low. To get an ides of what you should be charging get a friend to call 3 local companies for quotes for his yard. If your not charging 50 per hour you are gonna lose your ***
Couldn't agree more.
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Old 08-24-2012, 06:41 AM
xandrew245x xandrew245x is offline
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Originally Posted by LawnBoy0311 View Post
Couldn't agree more.
I'm not to sure what the prices are around here. I know I gave an estimate of $50 an acre for a 4 acre property, and i'm pretty sure i didn't get it. I hope they aren't much lower then $50.
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Old 08-24-2012, 06:50 AM
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Originally Posted by xandrew245x View Post
I'm not to sure what the prices are around here. I know I gave an estimate of $50 an acre for a 4 acre property, and i'm pretty sure i didn't get it. I hope they aren't much lower then $50.
If your not sure of the prices, call a few companies in your area and have them quote you. Go off those prices. That way you know the market and how you can price things. You won't be too high, or low ball.
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Old 08-24-2012, 07:51 AM
t-10yrs2retire t-10yrs2retire is offline
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Quote:
Originally Posted by Steve View Post
First off, what do you feel went wrong this year that you are going to try and fix next year?

Second,


Where is your profit? What do you need to profit in order that you can build up enough cash to go full time with your lawn care business and then hopefully be able to drop your hourly operating costs.


Im probably over thinking this if I am let me know. Hell for all I know im Under thinking this...lol



First...I started late (May). Most good residential lawn jobs are dependent on the summer residents. Which means I need to get out to them this time of the year for next year. Doing that now with buisness cards, flyers, pull offs, Signs on my trailer and doors of my vehicle, word of mouth hopefully from the couple summer res jobs im doing now.

Insurance: If I increase my coverage I can compete for some of the smaller comercial jobs with with equipment I have now.

Increased Knowledge: I am still planning on taking the gardner course put on through the state coop ext. As long as no more financial mishaps occure before then. lol. I am limited to what I have learned here and other places on the net. Right now I can mow. I could aerate if needed and can tell I think if its needed using a screw driver. I can over seed, remove leaves or mulch them back into the lawn, I know why these things are good (basically) but need to know much more!


Steve your second question:

I relooked at my numbers and If I understand your question right what I need to charge per hour to be able to go full time is what your aqsking? Im no accountant and this is my first buisness so please bare with me. And thanks for the help by the way.

To replace my TOTAL current income, cost of my "WANT" list above, I added a Misc expense and a profit of about $10400/yr my TOTAL NEED would be $107,393 / 2080hrs pr year = +- $52 pre hr.

Now I had to add plowing to cover jan/feb/mar. Plowing around here for residental would be about $125/hr ($25-$40/intown drive) and this is how things broke down.

jan...Plowing 160hrs @$125/hr=$20,000
feb...Plowing 160hrs @$125/hr=$20,000
mar..Plowing 200hrs @$125/hr=$25,000
apr...Mow/spring cleanup 160hrs @$50/hr=$8000
may..mow 200hrs @$50=$10,000
jun...mow 160hrs @$50=$8,000
jul....mow 160hrs @$50=$8,000
aug..mow 200hrs @$50=$10,000
sep..mow 160hrs @$50=$8,000
oct...mow/fall cleanup 160hrs @$50=$8,000

TOTAL INCOME: $125,000

These are obviously Ideal goals but im trying to understand how this works. This is my understanding of what I need to be looking at. Am I correct????

Once this initial investment is made as far as equipment ($18,000) I would need to figure on replacing it say every 3 years and being able to lower my cost/hr or adding to it and growing and keeping my cost/hr the same. Is my thinking correct on this also????

Thanks again for any help guys!!!
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Old 08-24-2012, 10:35 AM
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Quote:
I relooked at my numbers and If I understand your question right what I need to charge per hour to be able to go full time is what your aqsking? Im no accountant and this is my first buisness so please bare with me. And thanks for the help by the way.
Well what I mean is, to go from having a full time job to running your business full time, you are going to need to save up enough money to live on while you are making that transition. Do you need 6 months? Do you need a years worth of income saved? Once you figure this out, you can work this into your budget and make sure you are making enough to put away for that transitional time.
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Old 08-24-2012, 10:44 AM
t-10yrs2retire t-10yrs2retire is offline
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Ok Steve. I got ya now...thanks. I lnew i was missing something in there.
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