Profit Margins

[JML]

What is your profit margin when mowing lawns.

[Kent Lawns]

I'd love to tell you, but according to lawrence stone, nobody on this forum knows how to calculate profit margin.

[jrblawncare]

Don't get'em going,He has been good as of late.

[mattingly]

I have recently started and the way my figures come out I can apply a 35% profit margin on my mowing accounts and be competitive with other companies. Now I haven't put this in to effect yet but this is the margin I am looking at applying.<p>----------<br>Integrated Landscape Solutions<br>Lexington, KY

[Doug406]

Boy I hope your talking about realized (NET)profit and not gross sales profit. This is even low eather way in my standards. Because if your only wanting 35% it would look something as follows<p>$30 for a typical lawn<br>2 lawns per hour if you are fast<br>10 hour day (no family time 0)<br>5 days per week (rain & weekends)<p>30x2x10x5x.35=$1,050 for a week<p>x 26 or so weeks= $27,300 to spread out for the entire year

[mattingly]

Doug,<br>This is a more typical rate for bidding large contracts were you have to be competitive. The profit margin will vary from property to property. The profit will be set such that it is competitive with other bidders. On a small site obiviously the markup will be close to 100% to make it worth it. And yes this is net profit what I take home and it doesn't include labor. So with your figures above, you aren't including my labor per hour which is about 10.64. The beauty of my 35% is that it is fairly competitive with other bidders in town and this is what I can clear without setting foot on the property(aka..an employee is doing the work for me).<p>----------<br>Integrated Landscape Solutions<br>Lexington, KY

[thelawnguy]

I think its important to have a MINIMUM profit margin, not one thats cast in stone. <p>Every area has a going rate for mowing, as long as you can get the bid at or near the going rate and keep your profit margin at or above your minimum its a go. No sense in bidding at the market rate if it will leave your margin below your minimum.<p>I can underbid lawns in my area if need be and still be over my own m9inimum margin because either my own overhead is low, or the other operators in my area have a higher overhead which is usually the case, unless Im up against a lawn scrub, where it doesnt matter in a month or so Ill be able to re-bid.<p>Bill

[Toroguy]

I searched for the origin of "SCRUB". This is the thread I belive started it. On Feb 21, 2000 Bill "thelawnguy" used it for the first time? Thus creating a buzz word for the ages to enjoy and abuse.

I dont know if "thelawnguy" would like to add a few comments, suggestions, on revolutionizing terminology in the green industry...

It is possible another thread contains "scrub" on an earlier date and was brought back up thus throwing off my histories mysteries:)

[geogunn]

toroguy--you might be right about the origin of "scrub" here on the forum.

I do recall about a year and a half ago, however, that there was a song by jennifer lopez or christina aguilara (or somebody) that discussed the desirability of being with a "scrub". pretty funny, actually. "...hangin' out the side of his best friends ride..."

dude shoudda rode up on a new ZTR! yeah! that's the ticket!

GEO

[grassyfras]

The song was called "TLC- scrubs" It doesn't have anything to do with lawn mowing. But this is very intresting

[Evan528]

I remember stone being one of the first guys to use this term! I remember it catching my eye as a interesting term!

[thelawnguy]

Mr stone first used the term at his anti-forum Feb 8 2000 with the following post:

(Begin quoted text)

Your all fimiliar with the TLC song “No Scrubs” right?
According to the song a “Scrub” is a boy who for various
reasons will make an undersirable boyfriend.

Are you a lawn care SCRUB?

If you can answer yes to may of the following questions
YOU are considered a lawn care SCRUB.

1. You have never used a stick edger.
2. You live in “fly over” country.
3. You took a “short bus” when you went to high school at age 21
4. You actively solicit quarter acre and less commercial sites.
5. You have a Toro hydro walk behind that has 100 hours on the
clock that you can’t get to go straight for you have no clue as how to adjust the controls thus effectively having a $3500 paperweight.
6. You have to drive 200 miles to buy power equipment because you owe every dealer in town money.
7. You have no clue as figure out “gross profit margin”.
8. Before you got into the lawn care biz you ‘serviced’ portable toilets.
9. You’re unable to pass the pesticide licensing exams (see “short bus” above).
10. You think a five acre apartment complex is a “big” job and decline to bid on the project.
11. You live in the capitol of your state and ask the question: Where does one find state contracts?
12. You surround yourself with like weak minded individuals.
13. You close on 90% of your initial low end residential contacts thus effectively working for nothing and screwing up your local market for the licensed contractors how actually know their costs and profit margins.
14a. You have to buy new mowers for you are so poor (see #13)
the only tools you have are a bent flat screwdriver and a claw hammer you found in a customer’s turf.
14. You clean up dog s#it at “no cost”.
15. You advertise your services in the penny saver and offer
a “senior citizens” discount.
16. You listen to the Jerry Baker radio show and swear by
his “tonics”.
17. You get all your fertilizer at K-Mart cuz it’s cheaper there.
18. Your helper, computer mentor, and financial advisor is
still in junior high school.
19. You have no real interpersonal relationships just “internet” friends.
20. Your pickup truck has a flathead engine.


(end quoted text)

The following morning the term first appeared here at Lawnsite in a Stone posting.

This is the second time this has been clarified. Pay attention, class.

[Toroguy]

Thanks Bill,
I missed the first history lesson obviously. I had heard or read that Stone came up with the term, so it was slow on the board and I found this thread as the first one using scrub term and thought I was on to something.

I remember the "roundtable" discussion on a different site, and Lawrence Stone® had a heroes welcome there.

Now Stone has his name trademarked:) He is one wild dude!

[Evan528]

Bill! I thought so! thanks for verifying that! thats seem like an eternity ago i read that post from stone!

[David Gretzmier]

Bill- thanks for the re-posting. Even thogh I am a "senior member" ( what does this happen at 200 posts?) I have not read anything not searched for before I logged on in march. I actually had to answer yes to a couple of those. I guess I got too much scrub roots. Dave g