PDA

View Full Version : The BIG jump


Kent Lawn Care
02-01-2003, 08:44 PM
Just wondering what you guys spent when you took the jump from lawn maintenance into adding landscaping. im figuring about $300,000.00 ofr my plunge. also when you guys took your plunge wut equipment did you buy to get going.

grshppr
02-01-2003, 09:34 PM
I spent 9,000 on a bobcat and tandem trailer. Any thing else I need , I rent. I wouldnt neccesarily go all out and buy new equipment, buy it as you grow. A bobcat is the machine I most needed, but as I do more work, I'll purchase more equipment.

Shuter
02-01-2003, 11:17 PM
$300,000 is alot of money to start landscaping with. Did you add a zero or are you going into heavy construction, site work and road building??

Randy Scott
02-01-2003, 11:41 PM
Besides it being a little extreme, I highly doubt you will be able to get $300,000 at your age.

AGLA
02-02-2003, 08:49 AM
Is there a jump? With maintenance you develop a customer base that know you. They will expect that when they need other landscape work done, you will be there for them. You can also make recommendations and suggestions that they may want to go for. This is probably something that is already happening with you.

Installation does not REQUIRE a lot of additional equipment. Most maintenance people have shovels, rakes, and wheel barrows. Loaders can be rented. The first important piece is a truck that dumps.

The biggest mistake that landscapers make is to assume that if they have a certain piece of equipment they will make more money. It is only true if the equipment is being used full time. If you are doing maintenance and you do not have a crew that is keeping that mowing equipment busy all week, it is not time to equip the company with other equipment that will run only part time. The fixed overhead of that equipment is the same if it is in the garage or out working. Anything that is not out working is making it more expensive for you to operate.

Start doing the work and when you are making enough money and have enough work to keep the equipment busy most of the time, buy it.

That is just my opinion, not necessarilly the right one.

Kent Lawn Care
02-02-2003, 12:11 PM
Well lets see a few of the larger items i was planning on buying wih the money was a dump truck, a stake truck, a flatbed trailer, skidsteer (used) a 20' enclosed trailer for small equipment storage. and most of all enough for a couples employees pay for a month, i dont wanta get going without enough money to pay the employees. and the rest is just for small equipment purchases. i understand you all are saying to get wused equpiment, but in my area used equipment = no business, people around here want nice looking equipment people in uniforms working on their place. anyways, i hope this explains a little more where the money is going.



P.s. ive allready been approved for the loan so if your wondering where the money is coming from.

PAPS
02-02-2003, 01:08 PM
First, find it hard to believe that you were approved for a $300,000 loan being that you're only what 22-23?, and second if what you are buying is what you stated above then why $300,000. Seems to me that that equipment would only cost around $150-$165,000. I just don't buy any of your story.

KenH
02-02-2003, 01:48 PM
Ive been in business for 20 years and had trouble getting a $40,000 business credit line. Whats your secret??

Kent Lawn Care
02-02-2003, 02:21 PM
thats fine if you dont buy my story, thats not what im selling anyways. ive applyed through lendingtree.com. have had good luck with a 100,000 loan i got last year, so im sticking with them for a loan source. as far as the 300,000 i realize i might jusst be over shooting the idea, but i like to have enough money there for all those little hidin costs that always pop up, plus if im not mistaken dont you have to buy materials for the jobs, so ya kinda need money for that.

KenH
02-02-2003, 03:16 PM
Its not that I dont believe you, I honestly wish to know the details, ie. what type of loan, what rate, etc.

steveair
02-02-2003, 03:29 PM
I can't say its unheard of for someone to get a 300,000 dollar loan, start a company, and be successfull............but!

why so much investment?????????

If I had approval for $300k, I'd go out tomorrow, buy a house, and sell it next month for $400k.........people are doing it all over the place here.......that is a MUCH SAFER risk than starting a construction company.

Do you understand how much money you have to bring in a month just to cover that loan payment????? Do you have any idea the insurance premium would be on all of that equipment????


And money for materials???? What are you buying materials for? Isn't that what the potential client does? And same for labor............are you planning to work for free and have to pay your employees out of pocket????

And are you serious about 'not getting any work' unless you have new equipment??????? What happens after the first year, when all those new trucks are now 1 year old????? Does everyone stop calling you until you trade them in on new ones???? I guess 1-3 year old used trucks in your area look MUCH different than they do in mine.

Sorry, but you've already made yourself sound 110% rediculous.

Unless your name is Brickman and you have all those nice brown trucks driving around all over the US, I seriously doubt you are going to just get a loan for 300K, start a construction division, and have it succeed.

If you want help on starting a construction division, do a search.......tons of posts already made on the subject. If you want to just brag about a 300k loan, then go somewhere else.

steve

Mark B
02-02-2003, 05:19 PM
About the cost of materials. That is what accounts are setup for!! You go and pick up what ya need then you get a bill in a couple of weeks and the customer pays you then you pay the supply house. If you think that for one minute that all these guys are paying for the materials you sadly mistaken! I use 3 different irrigation supply houses and 1 rental store I have 4 different accounts. Each are about $5000 each. You don't need a high line of cradit at the supply houses. My 2 cents

Randy Scott
02-02-2003, 05:40 PM
:rolleyes:

Kent Lawn Care
02-02-2003, 06:20 PM
Well, thanks for the vote of confidense from everyone.

I was hoping to come on here for a few tips from people, and i thank those who helped me.

PAPS
02-02-2003, 07:20 PM
Originally posted by Kent Lawn Care


FIRST YOU SAID:

P.s. ive allready been approved for the loan so if your wondering where the money is coming from.


You said you were approved for the loan???

NEXT YOU SAID:

"thats fine if you dont buy my story, thats not what im selling anyways. ive applyed through lendingtree.com. have had good luck with a 100,000 loan i got last year, so im sticking with them for a loan source. as far as the 300,000 i realize i might jusst be over shooting the idea, but i like to have enough money there for all those little hidin costs that always pop up, plus if im not mistaken dont you have to buy materials for the jobs, so ya kinda need money for that. "


NOW your saying you haven't... get your stories straight before you start making up all this crap.

SWR11
02-02-2003, 07:45 PM
:D

kris
02-02-2003, 08:00 PM
If you already have maintenance going I would suggest that you invest in a used dump truck ... nothing else. Keep your borrowing to a minimum. Rent all other equipment ... Alga 's post is right on the money as usual.
Money to buy materials ... ask for 1/3 down at time of signing ... set up accounts ...collect your money ASAP after install completion.
Make sure you pay your suppliers in a timely fashion ...You will be in trouble without them.

wmsland
02-02-2003, 08:21 PM
If you want my advice, start small, do a few installs and see if you think it's something you want to seriously get into. If you want to get into it then do a little more each year until you can honestly afford to buy all the machines with their fancy bells and whistles. Each year I see (and I'm sure we all see) a few new companies out and about with all the newest and fanciest equipment and the following year they are nowhere to be found they just couldn't get the work to support all the new equipment. Your equipment should work for you you shouldn't have to work for your equipment. If you do decide to get into it big time make sure you have the work lined up, if not please put a post on this site to announce where the big equipment auction is going to be.

goose
02-02-2003, 10:27 PM
If you havn't gotten good advice yet then you havnt heard what you want to hear , yes spend $300,000 if you want to.

capital
02-02-2003, 11:10 PM
Kent, I am a little confused, why in the business you are in, are you going to a lender out town?

If they approved you, then go to a local bank with their paper work and your documents in hand, plus you had better have work lined up now, or know one will give you that amout of money.

Landscape firms this time of year can tell you how far out they are booked already, plus have you decided if you are gonna concentrate on commercial work or residential?

I think you need to do some more research, see nothing you are buying that approaches the level of money you are talking about

paul
02-03-2003, 11:49 AM
This post should have been moved to the business section but I'll keep it here for now.

My first question is how many crews are you looking at running? Second is how much business do you expect in doing your first year?
Third do you have someone to run your maintance side while you do installition?

DaddyRabbit
02-03-2003, 11:53 AM
Originally posted by Kent Lawn Care
Just wondering what you guys spent when you took the jump from lawn maintenance into adding landscaping. im figuring about $300,000.00 ofr my plunge. also when you guys took your plunge wut equipment did you buy to get going.

Kent, if I had access to 300K there's no way in hell I'd spend it all on something to work with. First I'd buy some sizeable property/acreage of your choice as long as it was a GREAT buy,(which in this sad economy it's out there) and hang onto it, this is your 401K. You certainly don't want to invest this much in a Biz. adventure that might stumble along the way. I would also look for used but like new eq. I,e, Truck/flat dump, Landscaping tractor or skid steer, attachments, trailer and of course a P/U. Don't worry about the equipment as much as the people you'll need to hire as the equipment will never give you as many problems as they will. I would certainly make sure the work was there before even considering a loan of that size. You'll hear a lot of people say Biz is booming but it's an egrecious lie. This economy is in the ruts and people just aren't spending money..period. In Republican terms it's called "growing the gap" between the haves and have nots and for the record it works.

dougaustreim
02-03-2003, 01:15 PM
About ten years ago, a fellow that was working for another landscaper in another town, came to our city and immediately jumped in full bore, the first year he was doing everything that we did and then some, and had all brand new equipment. At that time we had been in business 20 years and still didn't have as new a fleet as he did.

Three years later, we were being hired by numerous people to finish the work that was left unfinished when he folded. In fact, at one job, we had to wait for the bank to come and pick up several pieces of equipment that were in our way.

We bought several items at the bank auction. Got them for peanuts, one truck we're still using.

He was able to get the initial credit and equipment he needed but still didn't have the knowledge and experience to go with it.

Landscaping is one of the easiest businesses to get into and one of the hardest to stay in.

Doug
Austreim Landscaping

Stonehenge
02-03-2003, 06:09 PM
Kent,

I am admittedly surprised that a bank would give you that kind of money for a venture that it sounds like you aren't that well versed in (you said landscape installs were new for you, right?). But if you've been able to convince them you have a solid plan or that you have enough collateral to offer them to make them happy, then more power to you.

I think some of the others are elluding to some of the shortcomings for a venture like this, or at least this approach.

I believe their concern is (or at least I know my concern is) that even though you may have the money, and can get lots of nice equipment, and may be a whiz at sales, this is still a new venture for you. You're taking on all kinds of debt, and to support it you need to master a new field, train employees in a field that you may know less about than they (which isn't as tough as it may sound), and be able to effectively manage the employees using that equipment, learning that trade.

There are some people out there who are just destined to build large businesses, and they don't need to spend time learning how to manage people, building relationships with suppliers, or learning the field they're in. I don't know if you're one of those people. You might be. I know I'm not. That is to say, I know that if I were given $300,000 that I'd know the exact right way to spend it, or that I'd be able to manage the extreme growth necessary to support that kind of investment. You might be. But you've stacked the deck against yourself to do it. A slower, more deliberate approach might be the way to grow something like this.

(As a side note, many years ago I used to go to the Armada Fair - not a huge community from which to build a large biz, unless it's grown quite a bit in the last 15 years.)

And with this economy, someone mentioned getting goodies at an auction. Last year one co in my market went belly up, and this spring another just filed for bankruptsy. So be careful when spending all that cash.

Good luck!


Jeff

mklawnman
02-04-2003, 10:58 AM
:eek: $300,000 loan for a 21yr old, geez. Thats a big risk. Buying mostly all new equipment is nice, yes it all looks nice and dandy on the trailer and in the driveway or driving around but do you think that buying new will make customers come to you???
Im in the same situation you are except im a year younger than you are and my thought is to start small into landscaping. WOrk on small landscape jobs rent equipment you need and build off of that. Eventually I will get a skid steer and such but I wont get one until I have enough work for it. Rather not have a risk of paying for equipment that doesnt get used that much.
Gonna be paying alot off for the next 10yrs at least, hope you do well in the landscape work. :rolleyes:
Matt

John Allin
02-04-2003, 12:27 PM
I too am a bit surprised by the figures being bounced around on this thread. I know what kind of hoops we have to jump through to get that kind of dough - and I KNOW my financials are quite solid....

It doesn't quite add up right......

site
02-04-2003, 02:50 PM
Borrow $300k to start form scratch?? NO WAY!! The first thing you need to start a new business venture is customers. How many of those do you have? Do you have enough to generate $3 million a year in sales?- because you will need at least that to keep up with your loan payments. If for some reason you do have enough customers- do you have the knowledge and experience to run such a venture?
Don't try to be a hero who goes from zero to 100 in one month. build it up carefully and minimize the risk. Start out by spending $30 on "The Complete Estimating Book With Labor And Equipment Times For The Landscape Industry" by Charles Vander Kooi.

bubble boy
02-04-2003, 03:10 PM
whether it's business, auto purchases, or mortgages (especially first time condo buyers...) i often wonder if people understand interest rates.

carrying costs...debt servicing...principal vs interest...

Tim Canavan
02-05-2003, 12:18 AM
You can't buy experience with $300,000.00. I hope you're still reading these replies.

paponte
02-07-2003, 03:01 PM
:dizzy: $300,000.00?? :dizzy: I would DEFINATELY have to agree with dougaustreim on this one. Let your machines make money for you... don't make money to just pay off your machines. Geeze, if you want a full bore landscape design Company I'll sell you mine for that much money. Do you even realize how much of a hole that would be? I would NEVER let myself be in that BIG of a hole, unless your business structure would allow you to make it back within your first year!

65hoss
02-07-2003, 03:52 PM
I could buy some nice BIG toys for $300,000. I wouldn't have a place to park them or anything to use them on, but it would be fun to drive around.:dizzy:

Ok, seriously maybe you should borrow another $3k and buy another w/b mower.

Welcome paponte.

Lance L
02-13-2003, 10:43 PM
ive got the 3k wb forsale still hoss :D

LandworksEnterprises
02-14-2003, 12:47 AM
Hi There,
As for the "big jump." There wasn't one for me... I've been mowing for about 5 years now, just started my landscape division. $300k is an unheard of amount to me. Even if you bought all brand new equiptment, you wouldn't need anywhere near 300k bucks. I started my company on trust and thats where it stays. I make enough profit on my lawn services to cover my employees' pay four times over. I require a 50% deposit on all landscape installations. This covers material cost, as well as about half of you labor in most cases, that is, if you buy wholesale. So as for the the whole post, it makes no sense in spending that kind of cash, but it does make sense that in getting that big of a loan, you better make sure you have enough to pay the employees, because lord knows how long it'll be before you start making money on the company afterwards....

Nick Holbrook
Landworks Enterprises
Cleveland/Chattanooga, TN
:blob2:

loganshardscape
02-16-2003, 07:16 PM
Well, thanks for the vote of confidense from everyone.


Hope you spell better when writing your estimates and proposals for potential clients.

can you spell three-hundred thousand dollars?


:sleeping:

Stonehenge
02-16-2003, 07:38 PM
I always get a chuckle out of reading posts where people are critical of another's spelling...9 times out of 10 there are at least 2 typos in the critical post.

And Logan - am I missing something? Why would you need a vote of confidence? This is your first post in this thread, isn't it? I think everyone was directing their concern about spending that money to Kent.


Or are you really Kent?

loganshardscape
02-16-2003, 08:15 PM
stonehedge that was a quote from his original post with confidence mispelled.

Stonehenge
02-16-2003, 08:22 PM
Originally posted by loganshardscape
stonehedge that was a quote from his original post with confidence mispelled.

Ok. Now I got it. :)

To make it easier for you, if you just click the 'quote' button on the post you want to quote, it'll take you to the reply screen with that text quoted, so you don't have to retype it, and so people don't think those are your words.

Just an FYI.

Jeff

HOMER
02-17-2003, 08:59 AM
One who hasn't experienced the stress of debt hasn't a clue. When they do get a clue it's usually too late. If I could get a loan for $300,000.00 I would have one note to pay plus utilities and have a whole bunch left over that I would immediately give right back.

Debts a *****..............re-think what your thinking!

David Shaw
02-17-2003, 10:06 AM
I started up last spring, lawn & landscape. For landscaping I started with a p/u truck some shovels and a tiller. That's pretty much it. I'll admit you're not gonna get big jobs with this equipment but starting out you don't need to get big big jobs start with small jobs. I'll guarantee you you're gonna lose some money on jobs here and there till you're sure of what you're doing. Better to lose small money than big. I had to borrow to start the lawn business for my mower. No where near what you're talking and I sweat it every day. Don't think twice, think ten times before you borrow 300,00. :blob4:

IBGreen
03-11-2003, 05:21 PM
I couldn't imagine someone giving me $300,000 and I'm 21. I got $55,000 to buy a house with, $5 of our first payment went to principle. Imagine what it would be like on $300,000. You would have to bring in a lot of money.

bastalker
03-11-2003, 11:11 PM
Where did Kent go??
:confused:

65hoss
03-11-2003, 11:29 PM
Originally posted by bastalker
Where did Kent go??
:confused:

He smelled your skunk.:jester:

grshppr
03-13-2003, 11:43 AM
Maybe when he had that $300K in his hand, the urge to gamble took him to Vegas:D

Bigronboyce
11-06-2005, 12:47 AM
He must have went back to the house he lives with his parents in to cry about your harsh comments.

northwest lawn
11-06-2005, 01:08 AM
i havent been in the biz long but damn if u take out that much money with no guarenteed work your more than likely going to go belly up keep your over head to a minimum

kris
11-06-2005, 06:30 AM
He must have went back to the house he lives with his parents in to cry about your harsh comments.


this thread was posted in 2003 , was it not?

slicksilverado01
11-09-2005, 06:40 PM
this thread was posted in 2003 , was it not?


...............lol

vntgrcr
11-09-2005, 07:19 PM
Just wondering what you guys spent when you took the jump from lawn maintenance into adding landscaping. im figuring about $300,000.00 ofr my plunge. also when you guys took your plunge wut equipment did you buy to get going.
Not to sound snotty, but you might want to work on your basic grammar skills before you take the plunge so that when you write contracts, fill out credit apps. etc they look professional. This is how you spell "what", not "wut"!