Originally Posted by humble1
This is a great thread. Before I go on to me- You also left out employee theft- they mow lawns on the side w/ your equipment and you still are paying the overhead.
You may think I'm full of it but here goes. I used to have 9-10 full timers.45-60 hours a week, plus Sat P/T guys. We had a mowing crew, installation crew, brick drives,walks patios, irrigation, design and plant installs. 2 guys would hydroseeded 5 days a week. One summer we installed over 600 residential lawns. I was in my mid 20's and cocky as hell. Before I got married I was looking at buying a $130,000 dollar boat, yep I would have financed that too. I thought I was king chit. Thank God I didnt. I got married in mid 90's. One Aug I had about 100,000 in my checking account, I was going to get rid of our 4500-5K a week mowing route because we were making so much in installs. My new wife said are you crazy- that is dependable income. So after much discusion( or in my mind her giving me shite) I kept the mowing route. So moving forward. One Sun in Aug we go into the Ford garage I figure what the hell I got about 100K in the bank, I will buy this mustang for $35K. My wife talks me out of it, more like a fight, I was pissed. She thought things might not be this good blah blah blah. So a few days later I sit down to do paperwork, because now all I did was put out fires, do estimates etc. I wasnt working in the field as much. I wrote over 100K in checks,payroll, suppliers, quarterly's, truck and equipment , yard rent, etc. I went down to my accountant almost in tears. I couldnt believe that I didt have payroll for the following week. He said "You learned a lesson that no buisness college in this country can teach you" I said whats that? Its the first hand knowledge of knowing what it feels like to not know your operating costs. He asked what my labor rate was? $X per hour we were on the higher end back then. He says what are your fixed costs per hour. I had no clue. I had to lay off everyone except 2 guys. I put equipment for sale. I then was out doing the mowing route. I started getting calls why we wernt there etc. Turns out my trusted foreman was mowing accounts on the side using my other 2 guys as his labor. I was paying all 3 guys time and a half over 40hours, plus the gas and equipment, all the overhead. I had no idea how long the lawns took to mow. I never time tracked anything.
I bought clip, got back to basics. Ran a smaller crews. Big enough that I could keep my thumb on them. Bigger isnt always better.
I did get a better plan and have a full understanding now of costs. I always try to help friends in the biz. I own everything I have, except my house, I put 20% down on that. Things are looking up for once. I got out of landscaping and into fert/squirt with lessons learned. Yup I will say it my wife was right!!