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ACutAbovesiny
11-09-2006, 01:20 AM
Are any of you guys aware of your operating cost this year? Its my first year and I'm running just over $12,000. How about the rest of you???

rodfather
11-09-2006, 06:22 AM
I know right up to the day. I only have to look at my P & L Statement in QuickBooks.

What's nice about QB's is that it will also compare those numbers to the same time last year. Not only do I know where I was, but I can use this as a guide to tell me where I am going and want to be. To me, that is invaluable information helping me to manage my company.

ACutAbovesiny
11-09-2006, 07:14 AM
I plan on using QuickBooks next year. I was thinking of picking it up during the winter and inputing everything for next season.

ACutAbovesiny
11-09-2006, 08:53 AM
Anyone else? How about some of you new guys? Have you looked into your operating costs?

ACutAbovesiny
11-09-2006, 04:51 PM
I dont know how any of you are making money if you dont know how much you are spending.

mrusk
11-09-2006, 05:43 PM
I took ICPI last week and the overhead section really opened my eyes. Before the course, i figured out my overhead, but i was leaving alot of stuff out.

After the course i sat down, looked at this years expenses and started to realize why i am not making any money. I then made a budget for 2007. I now have a good idea how much i need to charge an hour if i want to pay all my bills, pay my self X amount a year and for the business to make 20% profit.

I have a feeling, that my prices will be higher then most now. But i think that is because most landscapers are not business man, and never will be.

Matt

ACutAbovesiny
11-09-2006, 06:06 PM
I took ICPI last week and the overhead section really opened my eyes. Before the course, i figured out my overhead, but i was leaving alot of stuff out.

After the course i sat down, looked at this years expenses and started to realize why i am not making any money. I then made a budget for 2007. I now have a good idea how much i need to charge an hour if i want to pay all my bills, pay my self X amount a year and for the business to make 20% profit.

I have a feeling, that my prices will be higher then most now. But i think that is because most landscapers are not business man, and never will be.

Matt


I took the ICPI last week too. In Saddle Brook. Same as you??

YardPro
11-09-2006, 06:35 PM
We know our overhead costs. We have been in business for 25 years.... hard to do without knowing your costs.... also it has enabled us to take on LARGE maintenance projects, and actually make money at them while still doing a good job. This is very hard to do since large projects normally have such thin margins.

Eclipse
11-09-2006, 09:56 PM
This is very hard to do since large projects normally have such thin margins.

Isn't that the truth.

J Hisch
11-09-2006, 10:50 PM
takes us $16,000 per month to keep the doors open, as of to date with equipment purchases and everything 209,000 and some change

topsites
11-09-2006, 11:33 PM
I have an idea, short of adding up all the totals which the bank does for me at end of year anyhow...

Shouldn't really matter whether it's 2,000 or 200,000, what matters is the % of income that goes back out. Further, everyone does things different: Where some figure labor as cost (well it is), others don't (figuring only equipment and parts etc).
So you never really know for sure anyway, but as a rule, 1/3 is cost, 1/3 is labor, 1/3 is taxes.

So, I pay everything with my credit card, very few things are paid without it and even fewer are paid for cash.
So long that 1/3 of my deposits pays off the credit card, I'm doing ok.
Sometimes it's more, sometimes less, but usually by end of year it's close enough.
Likely 12k this year, but here it does not figure labor, see...

ACutAbovesiny
11-10-2006, 01:37 AM
I took ICPI last week and the overhead section really opened my eyes. Before the course, i figured out my overhead, but i was leaving alot of stuff out.

After the course i sat down, looked at this years expenses and started to realize why i am not making any money. I then made a budget for 2007. I now have a good idea how much i need to charge an hour if i want to pay all my bills, pay my self X amount a year and for the business to make 20% profit.

I have a feeling, that my prices will be higher then most now. But i think that is because most landscapers are not business man, and never will be.

Matt


Did you take the class in Saddle Brook? Thats were I took it.

mrusk
11-10-2006, 07:40 AM
Yes i took it in saddle brook.

Matt

YardPro
11-10-2006, 06:54 PM
topsites...
that is not a god way of looking at your situation.
you should really be looking at the actual numbers.
using YOUR credit cards for materials is a TERRIBLE idea. you should have in house acconts at your vendors. these are interest free, and are not attached to your personal financials, unlike your credit cards.

also vendors will always give you a better price from an in-house account becuase they get charges about 4% from your credit card company.

Josh.S
11-10-2006, 07:09 PM
topsites...
that is not a god way of looking at your situation.
you should really be looking at the actual numbers.
using YOUR credit cards for materials is a TERRIBLE idea. you should have in house acconts at your vendors. these are interest free, and are not attached to your personal financials, unlike your credit cards.

also vendors will always give you a better price from an in-house account becuase they get charges about 4% from your credit card company.

I don't believe in credit cards, mine sits inside of my dresser and has only been used once, although I should buy something on it and make minumum payments for a while to get good credit. I spend everything on my debit card and write checks. At least that way I can look over everything I have spent.

Right now I don't konw my gross to net since I have only been big since late in the season, although I have seen my bank account go up so I know I'm making money, and alot of things I have bought are either one time expences, or annual expences (like I paid for 1yr of insurance, $300 of trailer tires, ect).. Honestly after I did next years budget it pretty much makes me depressed... I really need to find a good way to get more customers.... Its more fun to come home and be like, "yay I made $300 bucks today and nothing broke" comared to coming home and saying "man, by how many hours I put on the mower, and pay the employee, and depreciation, I probably made minimum wage".... I have budgets for next year even though I hate them, and basically all of my income is disposable income anyhow..

Eclipse
11-10-2006, 07:36 PM
using YOUR credit cards for materials is a TERRIBLE idea. you should have in house acconts at your vendors. these are interest free, and are not attached to your personal financials, unlike your credit cards.

I would not say this is a terrible idea assuming you use the CC's wisely.

Credit cards are interest free assuming you pay off your account every month.

Vendors in house charge accounts are only interest free if you pay off your balance every month. At least all of mine function this way. If I do not pay the balance in full by the due date I get charged 1.5-2% interest per month.

Some of my vendors are no longer allowing "in house" accounts. I had to put a CC on file with their office and every month I get a statement of purchases and the amount charged to my CC.

RedMax Man
11-10-2006, 09:20 PM
Yep, I'm one of the younger guys. I do my best to keep everything under control on the business side of landscaping. Everything is done on the computer... excel, word etc. I record all overhead expences and scan every reciept, invoices and warranties for equipment, tools, and utilities. I keep hard copies of everything in files. I record the time spent on every job we do as well the name and address of client, job type/description, cost, as well as scaning every client check payment and recoring them. There is nothing worse than being unorganized and not knowing where you stand financially.

Flow Control
11-11-2006, 07:33 AM
I would TOTALLY disagree about using a CC or materials and other costs is a bad idea, UNLESS you don't pay the balance off right away. I get my credit terms with my supply houses and when they are due I then charge it on my card (there are no increased fees for this) and now at the end of the year I have earned 10 roundtrip airline tickets since May. Not bad as far as I see it. CC's are a financial tool that can easily be used wrong, BUT if used right can be beneficial.

YardPro
11-11-2006, 07:16 PM
I would not say this is a terrible idea assuming you use the CC's wisely.

Credit cards are interest free assuming you pay off your account every month.

Vendors in house charge accounts are only interest free if you pay off your balance every month. At least all of mine function this way. If I do not pay the balance in full by the due date I get charged 1.5-2% interest per month.

Some of my vendors are no longer allowing "in house" accounts. I had to put a CC on file with their office and every month I get a statement of purchases and the amount charged to my CC.

hopefully the cards you are using are BUSINESS cards, not personal.

rule #1 of business:you NEVER co-mingle your debts and your business debts.

All it takes is one job gone bad and your personal credit could take a hit from your business debt being on the card. you could be left holdong the bag for a job where you could not collect.
this is why all of you should be INC, or LLC. this will insulate you from and financial problems your business has. believe me, it can happen.... almost happened to me in 1999. I had an $18K bill that i could not collect on... I was using personal credit cards, etc, for my business..... i took a big hit from this and it took me 5 years to pay it off, and cuased me to have to merge with another comapny to keep going....

tthomass
11-11-2006, 09:38 PM
I'm in the process of getting QB but to take a quick guess at it.......around $5,000 per month.............been at it 6 months full time. This $ is to cover paying my guy, truck, insurance etc.........the "have to"..........I take home pennies.

spring i'd say make it another $2,000-$4,000 more per month depending if I hire 1 or 2 people