How do I make $100,000 next year?

[Gordons Landscape]

Sorry for the up front post but I am a straight forward kind of guy. I have been in the lawn care (a little Landscaping) buisness for 5 years and have made a decent living. Nothing that great. My goal is to make six figures next year. This is my plan:

1. Grow from 1 employee to 3. Have 2 crews 1 mowing 1 landscaping.

2. Learn everything I can about landscaping as I am mostly a lawn care guy.

3. Charge a good amount of money for Landscaping I am thinking $35 an hour plus 100% mark up on all matierals. (not what I tell my customers just how I figure out the bid)

Really these are my 2 questions:

Is it possible to make 6 figures with 4 employees (including myself) two mowing two landscaping?

If so what is the secret to making this much money?

Thank you all for your help!

[olderthandirt]

Take your $35 hr. landscaping fee up to $100 an hr. would give you a good start. If your going to do landscaping your gonna need a skid steer or trac. and you need to charge accordingly. And yes you will gross 6 figures pretty quick, to net over 6 will depend on you.

Mac

[Gordons Landscape]

grossing 6 figures I have done 4 years in a row neting 6 figures is what I am guning for.

[KenH]

What is the percentage breakdown of your present business costs???? The easiest way to do this would be to anaylize your expenses, see if therre are room for savings, and up your prices a bit.

[Charlie Sierra]

Originally posted by KenH
What is the percentage breakdown of your present business costs???? The easiest way to do this would be to anaylize your expenses, see if therre are room for savings, and up your prices a bit.


This is certainly very sound advice. Andrew Carneigie is reputed to have said "if you watch the pennies, the dollars will mind themselves".

Make sure to consult with a good accountant. I have found that the rules, provided you know them, allow for very nice increases in profit through reduction of tax burden. payup

I have found that using information technology has increased my profits handsomely. Remember, information moves so you don't have to. Correctly managing information effectively allows you to be in two or more places at once. The cab of my F250 has cellular phone, satellite radio, laptop, digital camera and a few other Captain Kirk starter kit items which greatly enhance productivity.

Another good way to trim costs is group buying. Me and a few other small outfits are considering forming a 501C corporation as a shell so we can gain leverage on everything from new trucks to fuel and health insurance. The 501C status is a not-for-profit paper entity and also allows for the establishment and maintenance of 403B retirement accountants as well as some other juicy benefits. I figure wealthier, prettier and better connected people than I wrote the rules and I am only obligated to follow them. :jester:

[zedosix]

Anything is possible, all it takes is hard work, dedication from you and your employees, honesty, and a booming economy. A little bit of experience doesn't hurt either.
good luck

zed

[Gordons Landscape]

Thanks for all your help guys. Although watching my expensise is probibly my strongest point. I always look for a deal

[wojo23323]

I plan on doing over 100k next year with 1 full time and 1 part time employee. I will also work part time. I worked part time this year and my helper also worked part time. Gross over 50k. My goal is to work on my business and not so much in my business.

[NCSULandscaper]

You can gross 100k a year solo easily. It should be no problem if you have 4 helpers. Im planning on being close to 100k for next year and im solo and plan on being solo for a while.

[gogetter]

May not really answer your question, but some interesting reading that may be helpful to you:

http://www.lawnsite.com/showthread.php?s=&threadid=23399&highlight=Solo+income

I know that thread is about being solo, and you're talking about 3 employees, but there are some numbers in there that may be helpful.

Good luck.

[KenH]

Nevermind.

[Gordons Landscape]

Again I am talking making $100,000 after expensise before taxes.

[workaholic]

Take it slow to much growth to fast can be a lesson learned Im not saying it cant be done set some goals do above and beyond quality work and a little education goes a long way and you can suceed...

[promower]

Like every1 else is saying you can do it, probably with 1 or 2 less employees. But I would have to agree get your hourly rates up. You have been in buisness for 5 years, you have expierence, and obviously you do good work to stay in buisness. People will pay to have good work and have it done right.

[NCSULandscaper]

Originally posted by Gordons Landscape
Again I am talking making $100,000 after expensise before taxes.

I didnt see the net profit post you typed.

Yes with 1 helper plus yourself you can net 6 figures in a year. With 4 helpers you ought to be well into the 6 figure net. Good luck

[Randy Scott]

Originally posted by NCSULandscaper
I didnt see the net profit post you typed.

Yes with 1 helper plus yourself you can net 6 figures in a year. With 4 helpers you ought to be well into the 6 figure net. Good luck

I'd like to see the show of hands that have ever NET six figures in one season with one helper. At 25% profit, that would be a gross dollar amount of $400,000 per year. Working 365 days a year would mean generating $1095.89 per day, every day of the year. You can do the math from there if you really want to break it down into days you actually work. Netting $100,000 will take more than one helper. There is just too much equipment and related costs in this business to make too much more profit than that.

[BravesFan]

Randy,

What services are you providing where you're only turning a 25% profit?

Dennis

[KenH]

You can do new installs which can be 5-10K per pop for 2 days work. It doesnt all have to be mowing 25$ lawns for Mrs Jones.

[Southpaw]

I was thinking the same thing Dennis! ???

I thought about opening up a restaurant with all my chef experience, but the cost up front and the rate of failure told me not to do it. You will be lucky to get 7-10% on your ROI (return on investment).

I have not bought the big equipment, just rented it. I always include the cost of that rental in my bids. Some of my friends or family members question me for getting into to the green biz, but that's OK with me. They have no idea what they are screaming about anyway!

[chesie]

Hello I am new here, nice site!

ALright I am not trying to come off wrong, but those of you who net over 25% do you have more than 2 employees besides yourselves, pay taxes, insurance, workers comp, benefits, and have a legitimate shop other than your house. In this industry it is tough to net much over that. When i was first in biz through to 2 employees i could net 40-50%. But beyond that your overhead increases to the point you will price yourself out of the market. Look i am not saying charge $35/production hour(cause that is low) but most markets will not bare beyond $60/production hour. And i dont care how good you are. Once you hit about 350k you will assume overheads that are tougher to recover i.e. office staff etc. Consider yourself doing very well at a 15-25% net. Only reason I say anything at all is I dont want people new to the biz to get a false sense of how things really are.

Chesie

[NCSULandscaper]

Originally posted by Randy Scott
I'd like to see the show of hands that have ever NET six figures in one season with one helper. At 25% profit, that would be a gross dollar amount of $400,000 per year. Working 365 days a year would mean generating $1095.89 per day, every day of the year. You can do the math from there if you really want to break it down into days you actually work. Netting $100,000 will take more than one helper. There is just too much equipment and related costs in this business to make too much more profit than that.

Well i can do a $3,000 or even a $4,000 install in less than 1 day and profit ATLEAST 60% of that amount on a bad day. And when you get into the 10k or 20k jobs you can profit easily 7-15k in a matter of a week by yourself.

[hoyboy]

$35/hr. X 4 guys X 10 hrs day = $1400 gross/day - $500 labor = $900 gross profit.

$900/day X 200 working days (this will vary greatly) $180,000 gross profit.

Subtract your overhead expenses and, yes, it is POSSIBLE to net $100,000 in a year.

It is not probable, though.

You may be on that rate for a couple months, but there are too many variables to jump in the way. Business may slow down in the heat of summer. Unless you will be out at night making sales calls, you may have to hire a slick salesman to be able to bring in that much work...and he will be expensive. Most of your sales will likely be in the Spring and early Summer, which means you will likely need 5 or 6 guys in the Spring and only 2 or three later on. And that truck needs to be depreciated..... etc,etc, etc.

I can sit back and make a pro forma income statement that looks flawless and think there is no reason that it shouldn't work. Fact is, though, that things rarely go as planned. I think there are a lot of guys on this forum that will testify that, at the end of the year, things don't always add up the way we would like.

Possible, sure. Probable? Nope.

Dan

[olderthandirt]

Dan
I don't think anyone could have explained it any better!!!!!
We all get those easy installs where you can make a few K per day but we don't get them every day and thats what will kill the bottom line. 30-40k spring is pretty easy 10-15k summer is usual and back up to 15-40k in the fall if the weather cooperates thats working approx 45 hrs. wk for 7-8 months

[brentsawyer]

How do I make $100,000 next year.

With 4 guys and 2 crews like you said. Here's what I'd recommend

1)Residential mowing- tight routes w/ the right equipment and the right guys should land you $90-100/hr for the two working together or consider buying two vehicles and working them solo and you should get $60/hr. for each. *Requires the right guys* should get you at least half way there, could do the #'s but you have your own and these are just suggestions. Also, sell what you can as far as the landscaping goes here since they see so often and send monthly newsletters reminding them of the time of year and what is coming up, ie. mulch, flowers, aerating,seeding, etc.

2)Commercial- stay away from competitive bid markets and find you ones that are close together and really concentrate a small geographic area so that you can pick up snow removal in winter and spend very little, highly valuable time on the road ways.

3)Fert-Get at min around 80-90% of all accounts using you this way you control them as far as N goes thus decreasing Chemlawn or others from over appling N in spring increasing labor in maintenance additionally profitting nicely from the apps you do

4)Landscaping-will take the most sales from you. You will probably have to employ some sort of marketing methods here that will be the most cost efficient. I'd recommend direct mail. Did a small batch last year w/ 300 piece in one nieghborhood costing $150 and netted about 100 times that. Since this will be your highest cost, profit, expense area, I'd recommend staying on this when you can and doing what you can to help physically when you can. One added reason is that workers comp here is around 15% which is 10% higher than mowing. Also, really concentrating on time management is the key when landscaping. I see this all the time at the nursery and can't figure it out. Guys stopping in and picking up mulch w/ their entire crew or sometimes 4 guys. Do you know how expensive it is to have that many guys idle for picking up some materials at the nursery for lets say 20-30 min when they are not saving you any time. Stuff like that adds a ton and makes for a real unproductive payroll. When I have someone working w/ me, never is there two people in the vehicle except for lunch and arriving and going home. This is just a short list but it is what I would base my business off of if I were looking down your road.

[newleaflandscape]

friend of mine just mows lawns. He has two employees and did 130 worth of mowing this year. I think you should be able to do it no problem as long as you and your employees are hard workers

[chesie]

I think there is a little confusion here with some on the difference between "gross" and "net".

[promower]

Think your right, he did state make which I think would be gross. You make a 100,000 but you dont actually get to keep much of it:D

[MLI]

making 100g's is easy(gross)......keeping it all in your pocket is another(net). Id be interested in how long it took individuals to actually .....SAVE!!!!.......100 g's. To have that in the bank, or invested in some way.....would show how crafty some are in this trade! Some folks gross over a million, and yet only keep about 5%. Ive seen others do around 300k and keep 30%. With all that said.....it really doesnt matter how much you make...that will not dertermine ones wealth!!! The secret to stacking up some serious coin, is money management!! Some folk will make a 100k a yr. and spend 110k...go figure....some folk make 30k and actually save 10k. Go figurepayup payup

[chesie]

Well put MLI.

[DFW Area Landscaper]

++++Also, really concentrating on time management is the key when landscaping. I see this all the time at the nursery and can't figure it out. Guys stopping in and picking up mulch w/ their entire crew or sometimes 4 guys. Do you know how expensive it is to have that many guys idle for picking up some materials at the nursery for lets say 20-30 min when they are not saving you any time.++++

VERY good point. I see a ton of landscapers stopping in to the various suppliers around town doing exactly that.

How can you gross enough money when you are working to justify spending three man hours worth of pay to run an errand and pick something up? I've never understood that one. But I see it all the time.

Later,
DFW Area Landscaper

[DFW Area Landscaper]

++++$35/hr. X 4 guys X 10 hrs day = $1400 gross/day - $500 labor = $900 gross profit.++++

Something I think that's worth pointing out while we're on this thread: $35/hr X 40 hours X 52 weeks = $72,800/yr

That's about how much I made during my last full year of employment in corporate america. I have a BS degree. That's all.

And I'd say that may be pretty average for someone with 8 years experience in corporate america with a BS from a BCS school.

The actual cost to my employer was much higher than the $72,800...they paid a social security/medicare tax...they paid an unemployment tax...they paid for some life insurance...they paid for some health insurance...they paid a large portion of my disability insurance premiums...they paid to match a percentage of my 401K contributions...they paid for flights and hotels and meals and rental cars to send me to training...they paid trainers to train me...they paid an HR department to set my salary range...they routinely paid for my lunch...they paid for my morning coffee (something I no longer have time for if there's work to do)...they paid for happy hour a few times...they paid me to do nothing three weeks out of the year and on all major holidays...they paid me if I didn't work because I was sick...they even paid me a nice severance package. And that was just to push papers from one department to another and occassionally talk to customers. I never had to sweat or get dirty.

How can corporate america, with all of their insurance requirements and litigation expenses afford to pay americans what they're paying? How can corporate america build a business model that calls for hourly pay rates that routinely exceed what we hope to even GROSS?

Do you ever start to think you're just in the wrong industry and it would be an intelligent move to just go get a job in corporate america?

Later,
DFW Area Landscaper

[brentsawyer]

Intel for one has a 65% margin or so. Alot of tech companies are in the 50% plus range. Thats how.

Plus, barriers to entry. Us, pickup and shovels. Them, $$$millions, billions, VC's, stockholders who's only concern is profits or possibility of future profits. Basically taking money from one posket and putting it in another. Us, we need a salary and something to live off for our business's or we have no profit=lose house, etc. Them, borrow more money.

Yeah the corporate world is mysterious but simple. Ever had to buy replacement parts from Kawasaki. How about a head gasket for $35 that may take $.01 in materials to produce. Or how about Lexmark printer cartridges, their corp. offices are here. The $40 cartridge cost them around $1.50-2.00 to produce, they don't make the chips inside, that's contracted w/ another company.

[Dojo]

With 4 guys this year gross was approxitmately 270.000 . Problem with employees is skyrocketing overhead. That 270,000 gross gets knocked down really quick. I not sure that it isn't easier to net 100,000 as a 1 or 2 man operation. Being in the middle sucks!!!

[John from OH]

I would advise you to sit down with your accountant and ask them exactly what you ask here. You or your accountant can run your numbers backwards. Start with your $100,000 and use your current expenses to find out what dollar amount you will have to sell at what margin to make it work. Make sure to use a fudge factor to cover the things that don't always go according to plan. Be honest in your assessment and take your accountants advice on how your expenses will react to different sales volumes and different services. You will have to then play the scenarios with your service mix to make it most likely to happen. Once you have your sales volume, you can use your production rates to calculate how many hours of production will be needed, how many employees, and during what months. If you need to expand, plan it first so you will have financing and employees in place when you need them. Make sure your expansion plans are realistic. It is real hard to add a lot of employees in a short period of time and still keep your finished product acceptable. You can spread your money and your management skills to thin. After about 2 decades in the industry, I have seen more than my share of fast growing companies go up in smoke. Once you are convinced your plan will work, do it. Keep a close eye on any numbers that get out of range from your projections and correct things immediately. It can be done, but it will take work and keep your accountant involved in your financials.

[Little Guy]

Hook up with a Great Landscape Architect and you'll do that in a heart beat