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View Full Version : Work effeciency calculations? Drop customers?


Doogiegh
09-23-2002, 08:10 PM
Ok guys,
I've started using a clock so that I time-in and time-out for every house that I do during a day. I write down the starting time for the day (When I shift the truck into (D) for the first time, and then the time I arrive at each house. I also write down the time I depart each house. I then write down the time that I finally shift into (P) for the day.

I put this all up on Excel as a simple work spreadsheet. Tells me the time that I spent at each house, in minutes, and calculates what I am charging at each house therefore giving me an hourly wage. I also figure out the TOTAL elapsed time from my family, compared to how much I gross from the day so I know how productive I was overall. I make quick notes is anything is out of line, such as at 1 house, I re-loaded the trimmer with additional line, all hand-held equipment with gas, and stopped for 1 slice of pizza, etc.. This way I don't penalize that house, but it is all "In-transit" time.

I also look at this compared to a map to see if my route layout is productive or not and could it be better. I know that just by hitting 1 traffic light between houses could cost you 2 minutes which could sku the whole report as far as traffic goes, but I'm running this now for about the last 4-5 weeks.

I am also reviewing who my top paying customers are (hourly) and who I believe I should be dropping.

It is ** AMAZING ** to see what seems like good money, ISN'T and what seems like cheap pay and a waste of time is actually some of the better accounts...

I am trying very hard to NOT let myself think of "Well, heck I don't make a lot of money here, so I'm gonna do a crummy job.." but rather that I'm going to do the best I can do here so that they will be more willing and accepting of a price increase if I need to pass one on.

Other accounts that I now know I am doing very well with I won't mind taking away a couple of SMALL downed branches or doing a small little something extra.. I know that ANYTHING additional needs to be billed (Time and materials), but you know what I mean when you say you take best care of the people that take care of you.

Do any of you guys do that same kind of "Work Effeciency evaluation?" Do you do it all the time or only for a couple of weeks?

Do you drop people off of the calculations (lowest paying houses go, as long as they are not smack dab in the middle of a neighborhood that you will be going past anyway?)

What do you do with a customer who is smack in the middle of your range, buy pays SLOWLY? Is that an instant DROP or do you tolerate slower paying, but acceptable wage customers?

I'll go into more detail of the spreadsheet if anyone is interested.

Thanks

gene gls
09-23-2002, 08:33 PM
Sounds like you are setting up a "peice work" schedual. I would not expect to service any property the same each week. There are too many veariables durning the day to interfear. I have a "ballpark figure" and as long as its 15 min one way or the other then its OK. It usually balances out at the end of the day.

Gene

Doogiegh
09-23-2002, 08:39 PM
No, it's not a piecemeal schedule or evaluation.

It's weekly cuts.

Just figuring the time that the gate drops to the time it goes back up.
Surely I've seen it on here before where guys time themselves at .... 19 minutes... for a property.. And i'm sure they figure out what they are getting on that property and is it worth it.

Otherwise if you don't know how you are doing on a property, you may well be operating at a loss, not know it and it could be hurting you.

Always gotta keep trying to get the better paying accounts and lose the ones that don't..
Gary

roscioli
09-23-2002, 08:59 PM
I like the sounds of your system, I do time myself, but nowhere near that formally, just look at the clock and say to myself, hmm.. 20 minutes for $35, not too shabby, or 50 minutes for $40, yuck. I keep these all in mind when it comes time for a new season's price increases (or staying the same), but I dont write it down. Hearing your system is good motivation though, I like it.

kppurn
09-23-2002, 09:01 PM
Nothing can take the place of good record keeping. Some may see it as a bit extreme......but why not know which accounts are the most profitable.
More importantly, which ones are not profitable.
There are other factors involved also. You may have an account that isn't all that profitable mowing wise, but the add on services sure are.
If you have a full schedule, then raise the price on the accounts that don't provide an adequate profit. Especially if there are no add on services involved. I like to know averages. Spring time, summer, fall, etc. Try to account for all the variables. As G.I. Joe said, "knowing is half the battle" ;)

Darryl G
09-23-2002, 10:14 PM
I actually take more detailed notes than Doogiegh. I note what time I arrive on the property, what time I start and stop mowing, edging, trimming, blowing, and what time I leave. If you do this all the time you can get an average for that account, much more meaningful than just a few times. I make a point of knowing who my top 3 and bottom 3 grossing accounts are per hour spent. The bottom 3 are on the cut list if I get a better account or if they pay slow. The top 3 I make sure I hold on to.

Don't forget to consider how much you gross from each account monthly too. I have one account that is the 2nd from the bottom as far as money per hour, but 2nd from the top in gross sales/month, so I don't mind so much, especially since it's irrigated and gets mowed every single week. Call it a volume discount if you will.

Turfdude
09-23-2002, 10:15 PM
Doogiegh,

Most of the lawncare software programs have the "start & stop times" listed on their sheets (or you can automatically enter it in a palm pilot. I too check over the crews times and see which are more profitable than others. Some (not many) of my average paying mowing accounts I make up the difference w/ all of the other services (clean-ups, mulching, pruning, fertilizing, annual flower program, etc...). I have a very tight routing schedule that really minimizes travel time, and always try to get at least 2 accounts per stop. I know what I have to gross per man/per day to get by, do good, or do very well. I keep trying to adjust my schedule to avoid the foremost. There are way too any variables (especially in my neck of the woods) to try to keep the same time for a property in the srping as in August, or later in fall as leaves drop (which is also why I charge for leaf removal per visit when applicable as opposed to just spring and fall clean-up only).

Just keep on time tracking and do whats best for you. If a client pays slow (w/in 45 days, but always pays, just make sure to assess a fair late payment fee & put it in your contract - just get deposits for any job requiring materials first). If your price is too low, raise, or drop account. An out of the way account w/ a lot of travel - try to pursuade client to help you sell to some neighbors or again drop - the loss of time willl kill you alone.

Good luck.

Bob

SLS
09-23-2002, 10:46 PM
Good thread! :D

I have found that time management and assesment are very important towards boosting the ol' "bottom line".

Using several of the methods given above I have been able to increase my gross by about 43% over the last two seasons... while maintaining the same number of customers. Drop a funky one...and replace it with a good one, re-configuring my route, figuring out ways to save time at each stop, ect............

It is true..."Time IS money". :)

Now, if I just had a nickel for every time I looked at my watch and jotted down the time...... ;)

Doogiegh
09-23-2002, 11:57 PM
Roscioli - You really can keep tract real simple on a sheet of paper on a clipboard time in and time out. Doing the math is real simple, and if these are weekly or bi-weekly customers, you know real quick what you are getting paid. I tell ya, next time out, take notes on it for each house.. You'll be amazed at how what you think is great, isn't, and vice-versa.. You never know what you are really making till you do some quick number crunching and analyze WHAT you are doing.. Otherwise if you never do, you'll wonder why you are working like a dog and going bankrupt..

kppurn - I'm doing an average right now of the number of jobs I did by week, by month and what I averaged per month.. I also figured out that if I did only 40 jobs in July but did 75 in September, what was my comparison gross and did I do better money wise in July or September? I know lots of guys say "Show me the leaves" cause that is profit... Well, are you working 30% longer hours to get that profit, so really it is the same as simply grass cutting? Hmm.. <G> You could also calulate yourself till death which does no good, but it's good to know the top 3/bottom 3 and when the oppurtunity knocks, who to drop.

Darryl - I don't do the trim/blow/mow detail yet, but I like it.. Maybe mount a clipboard for a day to the back of the trailer, with a watch fastened right next to it so you know what's going on.. I like that idea..

I DON'T neccesarily like your "Low gross, volume discount" idea. Why cut someone's grass 5 times in one month (say $25 per cut, $125 in receipts, $5 profit per cut equals $25 per month profit.), when you can mow someone 3 times at $40 a cut ($120 in gross receipts, but at $10 per mow profit, which is $30 total profit).

I'd rather cut less, but more profitable then by wearing and tearing up my machines to get nickles and dimes... I know it's easier said than done, but I'd have to disagree with your volume discount idea.. Unless of course there are other savings like you are already within .2 miles in the same neighborhood, etc etc..

Turfdude - Will you offer your customers "Pay up front discounts" or "Pay for 10 cuts, get 1 free" kind of deals to your best customers? Do you do per occassion or monthly billing?

Thanks guys, Gary

65hoss
09-24-2002, 07:55 AM
Originally posted by darryl gesner
I actually take more detailed notes than Doogiegh. I note what time I arrive on the property, what time I start and stop mowing, edging, trimming, blowing, and what time I leave. If you do this all the time you can get an average for that account, much more meaningful than just a few times. I make a point of knowing who my top 3 and bottom 3 grossing accounts are per hour spent. The bottom 3 are on the cut list if I get a better account or if they pay slow. The top 3 I make sure I hold on to.

Don't forget to consider how much you gross from each account monthly too. I have one account that is the 2nd from the bottom as far as money per hour, but 2nd from the top in gross sales/month, so I don't mind so much, especially since it's irrigated and gets mowed every single week. Call it a volume discount if you will.

Hope you also keep track of the time you spend keeping time!:D

CMerLand
09-24-2002, 10:41 AM
Doogieh,

Sounds like your re-inventing the wheel. I use CLIP and it does record all that information your recording, does your billing, figures your dollars per hour, will print reports in any number of ways and does all this without having to do any figureing or creating of your own spreadsheet.

Go to clip.com and ask for a demo disk and you can see the benefits of CLIP in action.

Turfdude
09-24-2002, 06:26 PM
Gary,

I bill all my clients monthly. I only take deposits for mulching places which require 10 yds + of mulch, or all slow paying commercial accounts (they do pay but more like 45-60 days as opposed to w/in 30). I do not offer a pre-pay discount (why??), and I do not give services away generally. The exception to the aforementioned may be a small freebie to a good referral (all referrals get a thank you letter - goes a long way). All bills are for services rendered in that month. If I do a large job, I will sometimes allow the client to pay over time (w/in 3 months). I am fair - but I'm not a bank.

Per occasion billing wastes too much time and definately is not for me.

Bob

Fantasy Lawns
09-24-2002, 07:09 PM
When doing time sampling I use an average of samples (same property) over different times of the year ... as we find summer to slow down the work (it's hot out!) than doing the same job in spring or fall even early summer

the sampling really helps firm up future bidding process or price increases we must pass on (due to the fact we learned thru time samples how much to bid the job!) ..... as compared to "Work Effeciency evaluation" this could be due to better equipment or the experience of workers whom do the jobs, changes to the landscape or just learning the layout better

crawdad
09-24-2002, 07:43 PM
I keep track of time at a yard, but I don't keep details, unless i do extra work. So when the li'l ol' lady of the house talks to me for a few minutes, that is part of the job.
Crawdad

Darryl G
09-24-2002, 11:45 PM
Doogiegh - I just keep my day log on the seat of the truck. I need to go back to the truck to change tools anyway between tasks and take a drink of water, so it only takes a second to check the time (I wear a watch) and jot it down. I don't always crunch my numbers, but they're there if I need them.

As far the low "low gross, volume discount", it's not something I did on purpose. I kind of underbid that job, but since it's irrigated and it's $60 a cut, it's nice to have when all my other lawns are burnt to a crisp. So I'm not about to drop it. It takes me about 2 hours to service, so I'm still at $30/hr. Not terrible, but less than I would like.

Hoss - But then wouldn't I have to spend more time keeping track of the time I spend keeping track of the time I spend?:dizzy:

proline32
09-25-2002, 12:06 AM
I basicly do samplings from time to time to see if I am being productive or not, it is also a way to see if I need to take a price increase, On some jobs I make $75.00 per hour and others I make $40.00 per hour, overall I average about $50.00 per hour,

I have used sampling to let go of less profitable accounts, and I have found that It is easier to work on large properties versus small ones that you can only use a pushmower, Much easier to work with a zero turn .

GroundKprs
09-25-2002, 01:01 AM
WTG, Doogiegh. Now you're thinking like a businessman. A good accountant would have you keeping time logs for everything.

I have the times for every job since I started business. Really was a pain before computers to go thru log sheets during winter, running foot after foot of calculator tape. Now everything is logged in notebook computer from the computer clock in the truck. Transferred to desktop for billing and historical records, and times are reviewed during winter. After two years on a property, I can tell you within 15 minutes how much time I will spend there all year on basic contracted services.

Also, the timing of contracted vs. extra services showed me over the years that 15% of gross revenues are add-ons, and they only take a little over 10% of my time. So I never want to sell more than 85-90% of my time in advance, and miss out on the good paying extras.

By having the exact time for each property, I can tell how much extra time is spent on a storm cleanup. Usually anything over 5 min. is charged extra.

And why bother timing a property you have mowed for 20 years? Just to see if age is slowing me down, LOL. And it hasn't yet.

Doogiegh
09-25-2002, 05:47 PM
Well, I'll definatly be re-doing my time sheet for the upcoming weekend and work to including seperate times for mowing, trimming and blowing so that I can see where all of the time is being spent. This way I can figure out as you mentioned which aspect of the work is actually the most time consuming, per house and then make sure that the current price matches the work that is involved..

I don't mean to re-invent the wheel, just didn't know about CLIP software and I made up my spreadsheet in Excel in about 10 minutes... for free.. Seems to work out real nice so far for the real, so I'll see how it goes .. I'll check out clip website for a demo of it.

Now I wonder if I should go and measure each and every property with a measuring wheel so that I have hard numbers of linear and square footage to calculate off of.. cause I'm just like many many others on here.. We eyeball the bids...

Gary

HBFOXJr
09-25-2002, 06:49 PM
Your on the right track taking measurements. With out that, the time is meaningless for bidding purposes. The time you keep now is relevant for the current jobs as you can adjust prices or drop the account or let them drop you. Your making a decision on the current stuff by return per hour.

I can't stress enough the value of off the shelf, industry specific or service industry software for management of even the smallest business. The hundreds of dollars spent can quickley be recouped by using the information they can provide quickly and easily. If your talking returns of $30-$50/hr and your records are a little sloppy or incomplete just finding 30 more billable hours per year that were not previously counted on job time amounts to $900 per year that could be spent on software to ease your workload and improve profitability. 30 hours/yr on a 40 week season is only 9 minutes per day. I'll bet many are off by that on one job or just a minute per job times 9 per day is the price of software. It's not that you don't need or can't afford, you can't afford not to have management tools.

Good payroll organization and a program such as in QuickBooks or contracted through a service are also a key management tool.

I use QB and when my wife does the payroll she enters a service iitem number before entering the hours for the day. The item number corresponds with a task we perform like irrigation service or installation or aeration & seed, mowing, a specific application round etc. That information is stored and I can print a report showing exactly how many payroll hours were used for each item. It's no longer job time but the prep time, drive time, get supplys time etc. Those numbers totaled together give me numbers for equipment costs per hour and overhead per hour.

Don't ever say your too small.

LawnLad
09-25-2002, 08:37 PM
You can't change what you don't track. The key is figuring out what to track. I've struggled with this for a long time and have finally reached the point I feel fairly comfortable with what we track. We do track in and out times at each property and travel time. We track it as non-billable vs billable time. We track to the 5 mintue mark.

We break billable into the following categories:
Bed Maintenance - Foreman hours
Bed Maintennace - Technician hours
Seasonal clean up
Lawn Care apps
Other work (aeration, verticutting, slit seeding, etc)
Maintenance (mowing, edging, line trimming, blowing down)
Construction T & M (time and materials)
Construction Contract
Snow plowing/de-icing

We break non-billable into the following categories:
Travel & (Un) Loading
Equipment Maintenance
Meetings/Office/Training
Warranty/Rework
Fill Work/Shop Work
Snow plow prep (stakes, picking up supplies, hooking up plows, etc.)

We track this for each man on the crew. Depending on their position on the crew - will dictate how manyhours. The foreman have a little more non-billable in the morning and at night than the crew. They may only be 80% or 85% billable for their payroll hours than the crew which should be 90% plus.

I track each individual by the day. At the end of the week I generage a crew report showing me that Maintenance Crew One (MTC 1) generate $xx for mowing, $xx for bed maintenance etc. I then see the hours devoted to each category and I get an hourly rate of return for dollars generated. I can also track the non-billable hours and see how if the travel time is too high, etc. The rate of return for billable work is a bloated number since it doesn't consider the overhead portion of the non billable. So I look at the bottom line number for the crew each week. 150 man hours spent working... $xx generated in revenue gives me the realization rate for the crew for the week, month, etc.

When you decide what you're going to track, the information has to be useful to you. You also have to understand there is a cost to tracking, collating and reporting the data. Is the cost of tracking abc justified by the cost? I'm not personally intersted in mowing vs line trimming or edging times for our small residential properties. We're on site for 20 minutes or 45 mintues depending the on property size or time of season. I know that in May our dollars generated per hour for maintenance will be lower than in July or August because we're bagging and blowing more. I look at the average for the season - not necessarily by the week. From year to year you can look at similar periods of time for comparison - but even weather will effect the outcome dramatically from one year to the next. If I worked on large sites and I had a crew there all day or a half of day, I'd like to know how much time was spent mowing, line trimming, etc.

Just to demonstrate how important tracking information can be - the first year I started to track this information we had about 10,000 payroll hours. We were 78% billable, or we were productive for 7800 hours. We spent 2200 hours (22%) in overhead/nonbillable payroll.

I set a goal of shifting the 78% to 85% the following year. Assuming the same number of hours worked for comparison, gaining 700 billable hours at $35.00 per hour return meant that we increased our revenue by almost $25,000 without increasing our labor cost. And yes, we met our goal. I'm now shooting for 88%. Winter time really kills our non-billable hours for the year if I carry guys over the winter. So, we try to find billable work during the winter as well so we reach our goals.

We achieved this goal in several ways, both by changing billing policies (some services are portal to portal billing now instead of curb side billing) and by changing the way we approached our non-billable time. Who picks up parts or supplies and when? Who needs to be in first to load up? When and who gets gas for the trucks and trailers? Who does equipment maintnenance? Do we need to wash the trucks/equipment every week?

You get the idea. I like finding the forgotten $10.00 bill in my dress pants the next time I put them on... but I really like finding $25,000 because I started to look at my numbers!

CMerLand
09-25-2002, 09:03 PM
Doog,

Glad to see your gonna check CLIP out I hope it works out for you.

One thing I might question though is your idea to track the separate mowing, edging, blowing, trimming aspects of each job you do. For large commercial properties or where those jobs take significant amounts of time perhaps it might be worth it, however on your typical residential lawn not worth trying to track each minute.

Id suggest breaking it out into something similar to what lawnlad has as far as just mowing. Tracking how long it takes to service the property from start to finish should be plenty of information and then you can also quickly determine how long it took you to earn X number of dollars per hour.

Think of it this way, by determining it takes 6 minutes to edge a property and 8 minutes to string trim, 30 to cut and 6 to blow off you now know it takes 50 minutes to cut that property. Is there going to be any significant way to reduce the times it takes?? Or any realll reason to know that you spent 180 minutes last year to blow off that property?? Nope but you will want to know that it did take you on average 50 minutes per cut.

Also, if your data entry becomes ridiculous in terms of how you track the items you will quickly stop using that system. Instead of haveing 40 in and out times to record for 20 properties serviced in a day you will now have 160 data entry items to record and keep track of in your system. And once you have employees filling out the sheets your sometimes thankful that you even get the start and stop times on the properties written down and rhen remember to punch out at the end of the day.

I know of what I speak because a couple of my friends bought CLIP and now have it on the shelf because they were trying to get tooooooo much detail into the system, and then stopped using it because it "was harder then their last system" where they didnt try to track that info at all.

Good luck and let me know how u make out with that demo or if you have any questions.

Darryl G
09-25-2002, 09:48 PM
Tracking my individual times has helped me in knowing when I'm spending too much time on a task, usually trimming. I also have a habit of spending too much time trying to make everything perfect...picking up stray leaves and sticks, cigarette butts, etc.

The price for all my accounts in based on how long it takes me to do a property. I never want to be below $35/hour for mowing, or anything else for that mattter. So I draw the line at 50 minutes servicing a $35 account, which allows me some routine fueling/maintenace and travel time.

I have found that it takes me about the same time to mow every time, lets say 30 minutes. But depending on how far I take the trimming and grooming, it could vary a lot (most of my properties are 20,000 to 80,000 square fee and have wooded edges). So I might try to budget my remaining time to 10 minutes trimming and 10 minutes blowing. By making a habit of going into my truck to write my times, I find myself drinking enough water and checking my watch and time budget often, things I otherwise don't tend to do. That keeps me both hydrated and profitable.