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celawncare1
01-12-2006, 07:39 PM
Here is the problem that I am having!
I started my biz 2 years ago in Apr.04, kind of late for this area. I ended up doing 6500 for the year. I still worked full time so almost all the business money stayed in the business. Last year in Jan. I quit my job to pour all of my energy into the biz. I am totaling 22500 for the year, 350% growth but not enough. My problem is that all of the biz money is being spent for evryday personal expenses. How do I move to a point where the biz money stays in the biz, with me drawing a salary? I realize now that I prob shouldn't have quit my job until I was really going, but I am full in now and refuse to look back, or go back....any advice? Thanks in advance!
Also for the experienced owners does everyone go through this in the beginning? :confused:

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01-12-2006, 08:33 PM
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Hi celawncare1,

I think this is just a stage of growth. As you grow and make more money you will be able to draw a salary. Until that time, keep promoting your business and keep working on ways to grow. I know you can do it.

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celawncare1
01-13-2006, 09:27 AM
I think this is just a stage of growth. As you grow and make more money you will be able to draw a salary. Until that time, keep promoting your business and keep working on ways to grow. I know you can do it.


I hope this is the problem any other opinions?

Az Gardener
01-13-2006, 09:39 AM
I did'nt go through that. You need more work period, hell I pay my guys more than that. Try other successful maint co's see if they want to subcontract some work to you or if they have any pita's they are dumping. Check with install companies that don't have maintenance companies see if they will refer you. Possibly offer a free month of service for their completed jobs. They put it in the contract for new work and you have a first dibbs opportunity for new clients. Get more work, and get on a salary even if its small, also get a good tax guy you should be do a good return if you paid any. Get a payroll service if its over your head they are cheap and keep you legal.

walker-talker
01-13-2006, 09:57 AM
I will go full-time this spring. I will draw a salary. I will set it up on my online banking system where the money is automatically transferred from my business checking to personal checking. A percentage will go into my personal savings account for taxes. I basically figured what I needed to surive and not much more. The salary will be drawn for a fiscal year (not calendar) from April 1 to April 1. Over winter I will figure, based on sales and expenses, what kind of raise I will give myself.

MMLawn
01-13-2006, 10:02 AM
If Az Gardener didn't go through a growing process then he either bought an exsisting very sucessful business, or is the only one in the country and the history of the green industry to have ever not and is a pure miracle in the green industry. ;)

YES, every sucessful company goes through a growing process, and should year after year even. You are right you should have never quit your job with only $6500 in prior year revenues, but you did so now you have to get more accts. Plain and simple. You need to at least triple the revenue you currently have just to be able to pay the company bills and still be able to pay yourself a salary of only $35K-$40 even.

ooo
01-13-2006, 10:21 AM
I dont know if you have any type of "Penny Saver" weekly classified type thing that comes in the mail every week, but that helped me out. I have always worked for someone else and decided to start on my own last year. From the Penny Saver alone and getting referals from those customers, I ended up having 33 weekly cuts and probably 20 other people I did atleast 1 job for(several were people talking to other people(do a good job and people talk)). I took in about 65k+, but after buying different equipment almost every other week, I didnt actually make much. I would think down in GA you have a longer work season also. I also tried flyers but they didnt do much of anything. This year Im gonna try a few 1000 Direct Mail flyers through the Post Office. A little pricey, but I think it'll be nice to target neighborhoods and people are more likely to look at it more so than sticking some flyer on the mailbox or door. Im not positive its much better, but have to try it out.

rodfather
01-13-2006, 10:41 AM
Not to second guess you, but you should have had more money put away probably before going full time. Regardless, get as much work lined up as possible. And most importantly, write up a BUSINESS PLAN. Make sure it is down on paper and not just "in your head".

GreenUtah
01-13-2006, 11:16 AM
agreed, no one ever plans to fail, they fail to plan...but you're here now, so get out and sell, sell, sell your butt off. Do what others won't. If they will stick flyers on doors, you knock on doors, if they won't do small houses, you become the small house specialist. etc. etc. Be nimble and creative or go back to your old job. If your business does not pay for itself, then it fails and sucks you down with it.

get rich
01-13-2006, 01:06 PM
I have had the same problem the last year. Except i had a family of four others to support on a little less. Last year my old boss forced my hand in quiting and doing this full time. I'll bet my right arm i'll double my income of last year in the year to come. I tried fliers with a little success, but was bringing in ton's of work through word of mouth, being polite and doing just about any small jobs i could. I'm positive with a off season to work with i'll have a lot of bidding to do. I got out the phone book and called just about every hotel and restraunt in town to see if i could put in a bid. A lot of them said yes, problem was most were to big for one guy to handle. So this year with a plan of attack and more tools, i'm sure to land more of the work i quote. But the first year or two for most is a struggle, that i'm sure of.

Roger
01-14-2006, 10:27 AM
celawn... I agree this is an early stage, and explains why so many new LCOs go by the wayside so quickly. However, the stage is common to almost any new venture -- things just don't happen as quickly as we might like.

The suggestion of a business plan is good advice. If a well thought out business plan does not show the early growth rates that are needed for you, then your business interest needs to move to something else. The situation for early entries into the business the the lack of good information. It is a catch-22 situation -- need input for the plan, but not enough experience to provide good input. However, you've been in business for a couple of years, so you should have a very good idea of expenses and potential income. Unlike somebody with no experience trying to develop a good plan, you have a couple of years of numbers to draw upon.

No matter how much you might like to operate a mower, edger, trimmer, etc. or how much you like to work outside, and other such likes, if the monetary amounts aren't there to meet your goals, it is time to move on to something else.

Jpocket
01-14-2006, 01:28 PM
Bottom line is your not grossing enough to begin with. If your expenses total $22,000. I think you should work hard to the $40k mark, I don't know what your expenses are, but I think this is where you'll start to see the light at the end of the tunnel.

mtdman
01-14-2006, 02:59 PM
I don't understand what the problem is. You are growing your business. It doesn't happen overnight. It took me 5 years to transition from a job to doing this full time. During that time I drew a minimum salary and put everything back into the business I could to grow. If you draw too much for yourself, your business will stagnate. You have to reinvest in your business, which means you might not earn enough $$ for yourself to live off for a long time. Go get a part time job to supplement your personal finances.

celawncare1
01-14-2006, 10:57 PM
celawn... I agree this is an early stage, and explains why so many new LCOs go by the wayside so quickly. However, the stage is common to almost any new venture -- things just don't happen as quickly as we might like.

The suggestion of a business plan is good advice. If a well thought out business plan does not show the early growth rates that are needed for you, then your business interest needs to move to something else. The situation for early entries into the business the the lack of good information. It is a catch-22 situation -- need input for the plan, but not enough experience to provide good input. However, you've been in business for a couple of years, so you should have a very good idea of expenses and potential income. Unlike somebody with no experience trying to develop a good plan, you have a couple of years of numbers to draw upon.

No matter how much you might like to operate a mower, edger, trimmer, etc. or how much you like to work outside, and other such likes, if the monetary amounts aren't there to meet your goals, it is time to move on to something else.

Thank you for the advice Roger. I plan to succeed in this business and appreciate your advice to get there. Not sure if I heard it here or not but the facts are I need to offer more to my existing customers, and get alot more customers. Business plan advice will definitely help.

celawncare1
01-14-2006, 11:01 PM
I don't understand what the problem is. You are growing your business. It doesn't happen overnight. It took me 5 years to transition from a job to doing this full time. During that time I drew a minimum salary and put everything back into the business I could to grow. If you draw too much for yourself, your business will stagnate. You have to reinvest in your business, which means you might not earn enough $$ for yourself to live off for a long time. Go get a part time job to supplement your personal finances.

Point taken. I realize from all of these posts that I am not far off from where alot of others were starting out...kind of my reason to start this post, along with making sure I am doing things right...which I am not. Just not working hard enough, and overlooking alot of the important things. Thanks for the advice!