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General Business Discussions

A place to talk about general business discussions.
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  #1  
Old 03-21-2013, 11:47 PM
SNethercutt SNethercutt is offline
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So I'm in the Houston Tx area. Crosby to be exact, in Harris County.i started my business in liberty county but soon figured out there wasn't enough potential clients there so I moved to Crosby and never looked back. Business has boomed ever since. I had 1 major account out there 350 a month 12 months out of the year mowing 2.5 acres with house and pond. 45 minute job Every other week with two people.

When I moved I let my dad handle the account. The customers do not live there, I maintain their home over an hour away along with 4 other properties.

I pay my dad and his friend $50 each to mow this account. I don't do anything but invoice and make money.

Since then I have picked up 3 other accounts.

One is 160 a month, 50 a month and 70 a month. I see no money from any of those. I just bill for it and pay the taxes. I pay my dad and his friend for mowing them.

Their ZTR's and truck, my trailer. Would it be worth it for me to spend a whole day out there 2 times a month for that amount of money. Its a 45 mile drive each way. I still get the exposure because I make them wear company shirts and have signs on my trailer.

Or should I just leave it how it is and make nothing off these accounts every month?
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Old 03-22-2013, 05:04 AM
LawnBoy0311 LawnBoy0311 is offline
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Providing you have the time to do it, you should be cutting. There's no need to pay someone to do the work for you when you could be pocketing more.
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Old 03-22-2013, 07:02 AM
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It's just a matter of time before you pick up more accounts around them, then you can make a day of it.
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Old 03-22-2013, 08:16 AM
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Quote:
Originally Posted by LawnBoy0311 View Post
Providing you have the time to do it, you should be cutting. There's no need to pay someone to do the work for you when you could be pocketing more.
I would tend to agree, unless the money he gives his father is needed additional income. I always try to look out for family when I can.

I bring my son around with me on the jobs that I don't need a crew for, I give him $10 an hr for his time and try to teach him the business. Although we make him put 50% of it in his college fund. I don't want him to run the business for me one day but I do want him to have other skills he can make money with whiles he's in college...

Last edited by warbuff; 03-22-2013 at 08:19 AM. Reason: typo's
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Old 03-22-2013, 09:22 AM
SNethercutt SNethercutt is offline
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He doesn't need the money, and time is a constraint for me not to work on weekends.

My dad is retiring from the chemical industry ( herbicides pesticides and fungucides) and want to work for me when he does. So I'm trying to get all the accounts out there I can to keep him busy. But on the other hand that over 600 a month I'm throwing out the window.

I need the money, he doesn't. He could retire today if he wanted but he doesn't have enough to do
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Old 03-22-2013, 01:09 PM
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Quote:
One is 160 a month, 50 a month and 70 a month. I see no money from any of those. I just bill for it and pay the taxes. I pay my dad and his friend for mowing them.

Their ZTR's and truck, my trailer. Would it be worth it for me to spend a whole day out there 2 times a month for that amount of money. Its a 45 mile drive each way.
What does it cost you to operate per hour? If you are looking at (at least) 1 and 1/2 hours to get to the jobs and get back, what would that cost you?

Now compare that to the $80 + $25 + $35 = $140 you are making to mow those three customers per visit.

Your gas costs alone could be (90 mile drive / 15 mpg) = 6 gallons * $4 gas/diesel = $24

Let's say you operate at $60 an hour. For a 90 minute commute, you're opportunity costs would be ($60 x 1.5 hours) = $90. That is the money you could be making more locally.

So take that $90 you are losing during the drive as opportunity costs, add the $24 in fuel, you are now at $114. That's $114 you are losing during that drive to bring in $140.

It's interesting to think about.
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