Lawn Care Business Forum Lawn Care Business Book Lawn Care Business Blog Lawn Care Software
Home Forum Contract & Flyer Templates Blog Software Videos Podcast Calculators / Estimators Store Mower Review Design It Yourself Lawn Business School

Go Back   GopherHaul Landscaping & Lawn Care Business Marketing Forum > Lawn Care, Landscaping, and Property Management Forums > General Talk

General Talk If it doesn't fit anywhere else, post it here.

What is your profit margin?


General Talk

If it doesn't fit anywhere else, post it here.
Reply
 
Thread Tools Search this Thread
  #11  
Old 12-17-2007, 11:57 PM
FourSeasons FourSeasons is offline
Members
 
Join Date: Sep 2007
Age: 33
Posts: 558
Rep Power: 8
FourSeasons
Default

Quote:
Originally Posted by [b
Quote[/b] ]15-20 % depends on the job
Tim,

Is it the same as if maybe you were a journeyman in some trade or somewhere along those lines. Income wise? Or does it pass that? If it was about the same, what do you like about owning a business in this industry that keeps you in it instead of just going to work everyday for someone else and not have to worry about the problems that go along with running a business. And maybe making the same amount of income.
__________________
Rob
Green Image Lawn & Landscape

\"If you don't feel the same way about Friday nights as you do Sunday nights, then you are not doing the right thing.\"
Reply With Quote

Stop guess-timating. Learn how to estimate and make money! $$$
Mow Time Estimator Lawn Care Price Estimator Mulch and Topsoil Calculator Snow Plow Estimate Calculator


  #12  
Old 12-18-2007, 12:08 AM
caseyshields
Guest
 
Posts: n/a
Default

Lawn care business tipsLawn Care Business Book
Quote:
Originally Posted by [b
Quote[/b] (FourSeasons @ Dec. 18 2007,12:57)]
Quote:
Originally Posted by [b
Quote[/b] ]15-20 % *depends on the job
Tim,

Is it the same as if maybe you were a journeyman in some trade or somewhere along those lines. Income wise? Or does it pass that? If it was about the same, what do you like about owning a business in this industry that keeps you in it instead of just going to work everyday for someone else and not have to worry about the problems that go along with running a business. And maybe making the same amount of income.
You are thinking of the term "profit" as YOUR paycheck. This is not correct. PROFIT is the money left over after EVERYTHING has been paid....including payroll. Payroll (including your pay as well as employee pay) is an expense.
Reply With Quote
  #13  
Old 12-18-2007, 02:07 AM
realhuntin
Guest
 
Posts: n/a
Default

Quote:
Originally Posted by [b
Quote[/b] (caseyshields @ Dec. 18 2007,1:08)]
Quote:
Originally Posted by [b
Quote[/b] (FourSeasons @ Dec. 18 2007,12:57)]
Quote:
Originally Posted by [b
Quote[/b] ]15-20 % depends on the job
Tim,

Is it the same as if maybe you were a journeyman in some trade or somewhere along those lines. Income wise? Or does it pass that? If it was about the same, what do you like about owning a business in this industry that keeps you in it instead of just going to work everyday for someone else and not have to worry about the problems that go along with running a business. And maybe making the same amount of income.
You are thinking of the term "profit" as YOUR paycheck. This is not correct. PROFIT is the money left over after EVERYTHING has been paid....including payroll. Payroll (including your pay as well as employee pay) is an expense.
This is 100% correct. Profit is what is left after you pay your self and all other expense. If you are only making enough money to cover your business expenses and what is left is your paycheck then the profit is 0%. Profit is what the company made. You must be able to seperate the two, you never touch profit for personal uses, profit is what makes the company grow, if you are comfortable with this then it's all good and works for you cool, but if you want to grow you must leave some money for the company. Remember you have to pay taxs on what you earned personaly from the business (owner draws) and what the business earned (profit).

When I stated my company makes about 15-20% profit after I checked it year-to-date it is higher. I pay myself monthly just as I was a bill, because I am a bill to the company. You must be disciplined at this, seeing all this money you have earned and wanting to spend some, you cant do it personally not saying you can buy new or newer equipment or reimbursement of owner contributions to the company. If your company has no profit and say you only have one truck and the trainy go out, cost $3k (I know from experience) now what are you to do about keeping up with your customers and getting your truck back on the raod? Profit should be a cushion, for hard times and unexpected happenings.

I know this was lengthly but I hope it brought some light to the topic, this is a GREAT ONE.

Quote:
Originally Posted by [b
Quote[/b] ]
Tim,

Is it the same as if maybe you were a journeyman in some trade or somewhere along those lines. Income wise? Or does it pass that? If it was about the same, what do you like about owning a business in this industry that keeps you in it instead of just going to work everyday for someone else and not have to worry about the problems that go along with running a business. And maybe making the same amount of income.
To answer Rob I would have to say no, not at this point in my life, I could never work full time for anyone. I have been a business owner for 20+years and I don't know if I could work for someone else.
Reply With Quote
  #14  
Old 12-18-2007, 02:10 AM
realhuntin
Guest
 
Posts: n/a
Default

Dipping into the Profit of any company is a sure way to take that company under. No if's and's or but's to it.
Reply With Quote
  #15  
Old 12-18-2007, 08:04 AM
FourSeasons FourSeasons is offline
Members
 
Join Date: Sep 2007
Age: 33
Posts: 558
Rep Power: 8
FourSeasons
Default

Quote:
Originally Posted by [b
Quote[/b] ]You are thinking of the term "profit" as YOUR paycheck. This is not correct. PROFIT is the money left over after EVERYTHING has been paid....including payroll. Payroll (including your pay as well as employee pay) is an expense.
Good Point. You're right.
__________________
Rob
Green Image Lawn & Landscape

\"If you don't feel the same way about Friday nights as you do Sunday nights, then you are not doing the right thing.\"
Reply With Quote
  #16  
Old 12-18-2007, 08:06 AM
Steve's Avatar
Steve Steve is offline
Administrator
 
Join Date: May 2003
Posts: 37,567
Rep Power: 10
Steve has disabled reputation
Default

Rob,

Reflecting on this post now, was this more of a question on how much you should be paying yourself or how much profit you should be making per job?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #17  
Old 12-18-2007, 08:25 AM
FourSeasons FourSeasons is offline
Members
 
Join Date: Sep 2007
Age: 33
Posts: 558
Rep Power: 8
FourSeasons
Default

Quote:
Originally Posted by [b
Quote[/b] ]Reflecting on this post now, was this more of a question on how much you should be paying yourself or how much profit you should be making per job?
Well I don't really know how much I should be paying myself. I take a withdraw or paycheck every month enough to cover the bills and other misc. expenses and leave the rest in my bus. acct. for things like if the truck breaks or whatever. Also for other business expenses. My acctountant told me since I am a sole proprietorship business I don't have to do that but I like to keep the money seperate.

I think everyone here is going to have different income levels because we are all at different stages in our business. When I think of how much I am making I have it stuck in my head as a hourly figure because before May of this year thats what I was working for. So I am always comparing my income to that. Just in my first year its been more than I was making even as it has slowed down. We'll see as Jan. and Feb. go by.

Isn't a bonus of running your own business after it matures the income you can draw off of it. If it is successful.

I'm not sure if I answered the question or not.
__________________
Rob
Green Image Lawn & Landscape

\"If you don't feel the same way about Friday nights as you do Sunday nights, then you are not doing the right thing.\"
Reply With Quote
  #18  
Old 12-18-2007, 08:19 PM
realhuntin
Guest
 
Posts: n/a
Default

Quote:
Originally Posted by [b
Quote[/b] (FourSeasons @ Dec. 18 2007,9:25)]
My acctountant told me since I am a sole proprietorship business I don't have to do that but I like to keep the money seperate.

I think everyone here is going to have different income levels because we are all at different stages in our business. When I think of how much I am making I have it stuck in my head as a hourly figure because before May of this year thats what I was working for. So I am always comparing my income to that. Just in my first year its been more than I was making even as it has slowed down. We'll see as Jan. and Feb. go by.

Isn't a bonus of running your own business after it matures the income you can draw off of it. If it is successful.

I'm not sure if I answered the question or not.[/quote]
Rob one thing I see in this statment is what your accountant told you, now please beleive, this is coming from 20+ year of being a business owner with degrees in MIS (Management Information Systems), ACCOUNTING, SMALL BUSINESS MANAGEMENT I am not saying I know more or I am better than anyone else Im just backing up my statement with experience and education. BUT, "I would find a new accountant". It dosn't matter if your a sole-proprietorship, INC or a LLC you should always keep business sepereated from personal. He/She is right you don't have to keep it seperate, but it is best you do. I know this from fact, in 1993 I was audited by the IRS for a 103k discrepancy a customer did not issue the 1099 and I clamed the income on my taxes and in the books with out the 1099 and the customer reported the 1099 so RED FLAGS where popping up everywhere and in 1997 I was audited again for red flags. In 1998 I changed to a LLC, totally seperated business from personal and I was never bothered again. These audits stated because a large jump in income (PROFIT)from one year to another and not seperating business from personal. I congradulate you on wanting to keep it seperate. This has been a good topic for me because it has hit home in how I learned a hard lesson from the school of hard knocks and the IRS. This audit thing is the whole reason for changing and keeping seperated, if it isn't, then there is room for question, if this should ever occur. So stop the questions before they are asked when it comes to business owners and the IRS.

I know this is kinda off topic but I had to try and explain in more detail about accounting and the importance of it. All of this will show you how you can get your "PROFIT MARGIN" easier by using good accounting and why you should.

Thanks for starting this post.
Tim
Reply With Quote
  #19  
Old 12-19-2007, 08:42 AM
Steve's Avatar
Steve Steve is offline
Administrator
 
Join Date: May 2003
Posts: 37,567
Rep Power: 10
Steve has disabled reputation
Default

Tim,

Do you have any suggestions as to how much a newer lawn care operator should be paying themselves?
__________________
- Subscribe to my Lawn Care Marketing Blog Feed and get daily tips sent to you. Free!
Download your Free trial of Gopher Lawn Care Software.
Reply With Quote
  #20  
Old 12-19-2007, 07:34 PM
realhuntin
Guest
 
Posts: n/a
Default

Quote:
Originally Posted by [b
Quote[/b] (Team Gopher @ Dec. 19 2007,9:42)]Tim,

Do you have any suggestions as to how much a newer lawn care operator should be paying themselves?
Well the 1st thing I would have to ask is how many customers do they have are they full or part time at the business. 2nd how much have they figuered for expenses, truck pymt, fuel, etc. total the expencses + the revenue = amount company made less purchaes (your pay).
3rd. figure your living expenses all of them on a monthly basis, add together all income (pay checks from other) subtract house hold expenses from house hold income will tell you how much you need to live on.

If the mount needed to live on is less than the business amount earned your ahead of the game. so from there the first year I wouldnt put any strain on the business or your home life, this is VERY hard to do getting started. So only take what is needed to cover homelife bills if it is less. Set money aside when your able for the RAINY DAY, and beleive you me there will be those days. You arnt alone in the feast and famine days, EVERYONE goes through them tough it out and be sure to stick to the savings schedule you make for your business and DO NOT TOUCH IT for anyother reason than what it was created for.

Example; We have 5 different business accounts, NOT counting PAYROLL, 1 for rainy days, 1 for equipment new & repairs, 1 for business expenses, 1 general fund, 1 petty cash.

Note; you can move money from the general fund to any account that might be short for monthly expenses. there may be a time that you think you have to but it can always be worked out where you don't, SO DONT TOUCH IT if it is there for a reason. This is called BUILDING a Business

Now to answer your question Steve, Don't take more than is required to cover household expenses the first year or 2 then you can revaluate your business earnings and adjust how much money you pay yourself.

Sorry I got a little windy there.
Reply With Quote
Reply

Bookmarks

Tags
operating expense, profit margin

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Forum Jump

» Recent Threads
  RatingTitle, Username, & Date Last Post Replies Views
John Deere 667a
acrajchel
Yesterday 10:00 AM
Today 05:55 PM
by Just for Cuts
3 64
Dane Scag
Steve
08-28-2015 12:29 PM
08-28-2015 12:29 PM
by Steve
0 70
24 and 50 acre cemetery...
grassmasterswilson
08-18-2015 10:09 AM
08-26-2015 02:42 PM
by Steve
13 524
Rookie business question...
WarriorLandscapingCAN
08-05-2015 05:20 PM
08-26-2015 02:33 PM
by Steve
3 394
How to clean an old...
rmccutchan
08-16-2015 05:23 PM
08-26-2015 02:31 PM
by Steve
9 402
how to make customers...
Bradcook21
05-27-2015 05:04 PM
08-26-2015 12:25 PM
by kslawn
19 3,731
Needing a website built
burtle
06-17-2015 09:02 AM
08-25-2015 11:31 AM
by acrajchel
9 2,467
Big mowing job
Bradcook21
07-30-2015 03:57 PM
08-25-2015 11:23 AM
by acrajchel
17 978
ZTR Review
Shark1611
05-31-2012 10:42 PM
08-25-2015 11:16 AM
by acrajchel
8 3,749
Hi Everyone
mmays29
08-25-2015 08:16 AM
08-25-2015 11:15 AM
by Steve
3 112
Should I buy this Exmark...
googus
07-03-2015 09:22 AM
08-25-2015 11:08 AM
by acrajchel
11 1,176
Old Business New Owner
Toyman
06-17-2014 08:57 PM
08-25-2015 11:00 AM
by acrajchel
17 1,567
Hi everyone! We're new...
alltrades
08-22-2015 12:46 PM
08-24-2015 10:41 AM
by Steve
2 161
CAn I get some help with...
rootytalbot
08-11-2015 06:14 PM
08-24-2015 10:36 AM
by Steve
12 502
Hi
Wemowjunction
08-16-2015 08:45 PM
08-20-2015 01:46 PM
by Steve
11 398
Drive cable bad?
SGL1
08-10-2015 11:16 PM
08-20-2015 01:41 PM
by Steve
5 359
Hey there everyone
Cole8999
08-16-2015 04:42 PM
08-18-2015 04:35 PM
by Steve
3 247
Help with a truck
bdodson89
04-27-2015 08:15 PM
08-18-2015 11:47 AM
by rmccutchan
7 958
I need some aeration...
rootytalbot
08-14-2015 12:32 PM
08-18-2015 07:59 AM
by rootytalbot
7 376
Say Hello !!!
Steve
03-19-2007 11:18 AM
08-17-2015 04:34 PM
by Steve
1,229 406,034
Whats wrong with this...
GreenWorx
07-28-2015 07:56 PM
08-16-2015 11:42 PM
by rmccutchan
3 587
What's your next...
Steve
05-15-2015 11:54 AM
08-16-2015 11:09 PM
by SC93
16 1,234
These are the days on...
ExtremeLawncareServices
01-11-2015 10:41 AM
08-14-2015 11:08 PM
by scaypa
95 11,451
New Biz
kufnerins
08-14-2015 05:52 PM
08-14-2015 08:56 PM
by Steve
1 208
Chemical and Fertilizer...
rmccutchan
08-09-2015 10:36 PM
08-13-2015 11:11 PM
by rmccutchan
6 401
String trim BEFORE mow...
Mr. Mow
04-12-2015 08:13 AM
08-13-2015 02:10 PM
by rootytalbot
12 2,068
Hello all thinking about...
bernie
08-11-2015 04:28 PM
08-13-2015 10:33 AM
by Steve
8 365
Logo Help Font Color
LZLC
08-08-2015 09:26 PM
08-12-2015 03:50 PM
by Steve
4 336
Pricing issue
Mr. Mow
07-07-2015 06:15 AM
08-12-2015 12:30 AM
by Jeff1
20 1,798
My new mower
Chilehead
08-08-2015 09:09 PM
08-11-2015 08:36 PM
by Chilehead
9 506
Thought this was a good...
Just for Cuts
08-06-2015 03:38 PM
08-11-2015 10:54 AM
by Steve
8 506
Plowing pricing
jcurr33
08-08-2015 04:58 PM
08-11-2015 10:51 AM
by Steve
6 466
Should I upgrade my back...
googus
08-07-2015 10:50 AM
08-11-2015 10:44 AM
by googus
7 431
Keeping it clean....
Wolf4dk
08-09-2015 11:31 PM
08-11-2015 06:34 AM
by Chilehead
7 357
I have been rude and...
biglee
06-15-2015 10:11 PM
08-10-2015 09:41 PM
by stallman419
12 2,747
Newbie Saying Hi.
LZLC
08-08-2015 09:22 PM
08-10-2015 11:20 AM
by Steve
1 250
How much do I charge to...
Chris Herrera
08-06-2015 09:30 PM
08-09-2015 11:31 AM
by biglee
2 391
scag SWZT review!
mattthelawnguy
07-23-2015 02:28 PM
08-07-2015 03:26 PM
by Steve
17 1,133
Best commercial contract...
sanlanct
08-04-2015 12:18 PM
08-06-2015 06:20 AM
by sanlanct
2 386
I came across this on a...
rootytalbot
08-02-2015 11:04 AM
08-05-2015 08:17 PM
by SC93
9 624
Help bidding a hedge...
hopolb33
08-02-2015 06:09 PM
08-05-2015 02:07 PM
by Steve
3 427
recycler toro 22"
rvezakis
08-03-2015 12:10 PM
08-04-2015 11:47 AM
by Steve
1 306
» Popular Tags
ad landscaping advertising aerocore applying bark billy goat brushcutter blowout bob villa bush collections contract help curb appeal services deliquentaccounts demonstration design door hangers edging employee problems equipment dealer equipment rental facebook flyers free advertising free lawn care google growing a lawn care business hiring how to hydro increase customers jobs landscape landscaping lawn aeration lawn care lawn mowing marketing marketing secrets more customers business mr dave mulch new business ordinance past due per hour charge per hour service plowing pricing profit on employee roundup scag secrets to landscaping sell the vision seo shell shreaded solo solo backpack sprayer sq ft square foot swzt tree tree pics walk behind web design website website design winterization wood www.greenturion.co.za
Powered by vBadvanced CMPS v3.1.0

All times are GMT -5. The time now is 10:22 PM.


(C) 2011 Riggs Publications - Terms of use & Privacy Policy

All times are GMT -5. The time now is 10:22 PM.

(C) 2011 Riggs Publications - Terms of use & Privacy Policy