Help in Starting out

[Dugger1]

Hello,

I am new to this site as well as to the industry. My partner and I have decided to fully pursue landscaping business and I have a few questions. Regarding our background, my partner has a degree in Horticulture and around 7 years experience working for full service landscaping companies, most recently as a head foreman. As for myself, I have degrees in Accounting and Math, as well as a Masters in Computer Science and experience working for small (fathers used car dealership) and large corporations (70K + employee operations). I believe with our diverse backgrounds, we could be quite successful in the landscaping business.

For starters before I came into the picture, my partner began developing work during his spare time (we both work full time) and acquired 25 lawn accounts last year, as well as a few significant installations (roughly $25 Thousand in revenues, $9 Thousand net) and one full time employee. In addition, we have purchased all new Scag walk-behinds, truck/trailer, in addition to a rental property last year, which also helps in bringing in regular cash flow, which I no doubt will be helpful in such a seasonal industry.

Now for my questions: Currently, I have structured the company as a Limited Liability Corp, fully insured and compliant with my local municipality coding regulations. Have any of you had any significant issues regarding zoning? We are considering the purchase of storage/potential office space facilities and I was wondering how have local regulations faired for landscape contractors?

Locations: What areas have proved most profitable for business? Cheaper storage lots in "lesser" neighborhoods, or have any of you found it beneficial to buy/build in more ideal locations? Essentially, has your location been a primary factor in your viability as a landscape contractor.

In addition, we have created a detailed business plan, but I am finding it difficult to prepare realistic financial projections. What type of protocol have you followed in order to prepare realistic growth rates? Basically, what have you used as starting points for determining short/long term profitability?

This leads me to my next question, what type of salary range have owners/partners of small to medium sized organizations experienced? What size operation did you have (headcount, revenues, marketshare, etc.)? Basically, I am attempting to determine an acceptable period of time until my partner and I would be able to quit our current jobs.

Thank you very much in advance for you advice.

[Sean Adams]

Dugger1,

Congratulations on your new venture.... I agree that with your background and your partner's background, the business will operate with two unique and cooperative perspectives. I will say that passion, desire, hard work, and persistence in this industry will get you further than anything else.

As far as the rental property, depending on where you are located, the supplemental income never hurts. If you are not getting 40-50 mowings in a season, you will need something.... snow & ice, seasonal decorating, etc...

As far as the zoning question.... I've dealt with this first hand. Simply check with that actual local municipality. Ask to speak with someone from the zoning board. There was a building / business started that had no problems, issues, etc.... 600 yards down the same road, the same business tried to start and it was stopped. The reason..... different municipalities. Everyone's zoning is different.

Location will never hurt, unless you allow it to hurt you. As a company like this evolves, it is not easy to keep the appearance of your facility as attractive as you would like, or as attractive as the public would expect. If you can find a location with good "frontage" that keeps the back of the property concealed from public eye, then go for it. Trucks, piles of wood, piles of grass, mower parts, trailers, etc... are not as appealing to your prospects as they are to you. But if you find a heavily travelled road, and it is affordable, why not?

Your business plan, and more specifically, your financial projections are going to depend on several factors. Everyone and everywhere is different. Sounds like a cheap, cop-out answer but it isn't....

There are a lot of variables... who is going to work? how much are they going to work? how much are they going to get paid? what types of services will you provide? what will be your hourly labor rate? how far will you travel? what will you do in the winter? how much competition is there in your area? how much working capital do you have now? what are your equipment needs? will there be licensing? continuing education? who are the employees? h2b vs. non-h2b?

These are questions that may affect your 1st year and having nothing to do with your 5th year. This is where I would turn to your partner who has 7 years experience. Get him to start laying out scenarios that will alow you to start figuring things out. Also, are you going to use this business plan as your personal blueprint, or are you using it to acquire financing? Or both?

The salary question has been asked on this site a lot of different times. I would read over past discussions by using the search feature. I know you have full time jobs, but when asking about salary, who will be doing the work? In other words, will you and your partner be working part time together evenings and weekends, or will you have employees out in the field while you are working your full time jobs?

Welcome to LawnSite.com.

[soccer911]

If you will put as much effort into getting new accounts as you are doing number-crunching you will be very profitable.