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View Full Version : % of income spent on marketing?


paponte
01-24-2006, 08:45 AM
Just curious to see what kind of percentages guys in here are spending on marketing if any? Alot of times in business this is something that gets overlooked. I hear all the time from guys "I'm happy with the current accounts I have now, I don't want anymore". What about when a couple all of a sudden drop you for no reason? People move, they start doing it themselves. Things happen. Is marketing something we leave till when something does arise? Or are we prepared for what the industry throw at us? :)

Edgewater
01-24-2006, 09:36 AM
I think that marketing should not be looked at as a percentage of sales. Everyone should look at what they want thier marketing campagin to accomplish and assign a cost to that.

That being said, the budget does have to be reasonable. I spend about 5% of sales on marketing.

paponte
01-24-2006, 11:53 PM
Wow! Maybe this is the reason for all the threads "getting new customers???, lost another one to a lowballer, etc". Amazing!

MacLawnCo
01-25-2006, 12:25 AM
P, what do you mean? My business is at 1% of sales and that is 100% unconventional... you wont even find my phone number in the phone book. I know this is low, but I enjoy it that way.

Mower For Less
01-25-2006, 12:38 AM
I am currently at about 10%. I am including all costs, including labor to distribute flyers, newspaper ads, biz cards, etc..

Kevin

RHayden
01-25-2006, 12:38 AM
1% to 1.5% here as well.

Mower For Less
01-25-2006, 12:38 AM
Forgot to mention I had 150% growth from 2004 to 2005 ytd grosses.

LawnsRUsInc.
01-25-2006, 03:11 PM
Well as a common rule a company that wants to grow should spend 10% of thier gross co. income on advertising. I spend 6% and i get an average of 100 new customers a month that call. In march to june i was getting 300-350. But i have found that 6% is way to much for me to handle. With a 280% in gross sales from 2004 to 2005.

rodfather
01-26-2006, 08:37 AM
In this business, I would think 5% would be plenty. Years in business will play a factor too.

paponte
01-26-2006, 09:06 AM
P, what do you mean? My business is at 1% of sales and that is 100% unconventional... you wont even find my phone number in the phone book. I know this is low, but I enjoy it that way.

Mac, I guess I should have worded it as percent of expenses. Either was I pretty much means hte samething. I just think it's inportant to allow money for some type of marketing. Whether it be signs on trucks, yellowpages, local paper, direct mails, etc.. Not picking on you in anyway, but how do you say that you like it that way? Do you not want to expand your business at all?

I think 5%-10% would be a fair value, depending on how much growth companies are looking for. It's a VERY important part if business that alot of companies do not take into consideration. payup

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01-26-2006, 12:08 PM
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Hi paponte,

I think 5%-10% would be a fair value, depending on how much growth companies are looking for. It's a VERY important part if business that alot of companies do not take into consideration.

I agree with you as well.

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Jpocket
01-26-2006, 02:31 PM
I will spend about $2,000 this year on marketing and advertising, vs. $600 last year. I think your budget should reflect how much you want to grow. If your not looking to grow alot just maintain customers i'd think it'd be 1% or less.

tcls83
01-26-2006, 02:49 PM
I'm spending a good amount for next year. I bought this computer I'm using now last Dec. for mainly the sake of typing letters for getting commercial accounts next spring. I didn't have a computer for a year and a half before then. Hopefully it will pay off, and also I never knew I'd stumble across Lawnsite for helpful tips.

I'm getting stationery made, yellow page ads (although a downgraded ad compared to last year) , flyers for newspaper boxes, ads in newspapers (-what I've had best luck with getting accounts in the past), also considering shirts. I'm going all out this year, all forms of advertising do pay off in some way. All of that is estimated somewhere around $1,200- $1,500.

MacLawnCo
01-27-2006, 12:56 AM
Mac, I guess I should have worded it as percent of expenses. Either was I pretty much means hte samething. I just think it's inportant to allow money for some type of marketing. Whether it be signs on trucks, yellowpages, local paper, direct mails, etc.. Not picking on you in anyway, but how do you say that you like it that way? Do you not want to expand your business at all?
I dont want to say too much, but I will offer this.

Dont miss-understand me. I do want to and have continued to grow. This past year, I grew around 30% which is dancing right around my limit... I just choose to promote my business with less costly methods. Why do i enjoy it? Because I control (plan) the growth of my company and am ultimately more profitable.

tuscanvalleylandscaping
01-27-2006, 09:10 AM
Looking at a 3-6% this year.