Originally Posted by britsteroni
Have you already gone out and purchased equipment specifically for this business? If not, I would take the next few months to evaluate whether you are making a good decision or not.
This business can easily net you $13,500 per year working part-time, but it will take a lot of work to get there.
Here are some questions I think you should consider before you jump into this head first:
1. If you currently need $13,500 to maintain the same standard of living, what will the plan be for the future as prices continue to rise (inflation) and your body breaks down as you age? I'm guessing you are in your 50's, so SS and Medicare will kick in once you reach 65 (there are a myriad of other factors, but 65 for simplicity). In my opinion, it is risky to bank on your body holding up into your middle to upper 60's chasing a mower around all day.
2. What other skills and abilities have you acquired over your lifetime? Is there another part-time business that would be available for you to start with similar start up costs? There is nothing wrong with mowing lawns, but the barrier to entry is so low that competition is fierce all across the country. That doesn't mean that you can't be successful, but in a heavily competitive market, econ 101 tells us that it is a race to the bottom for profit.
3. If you only need $13,500 a year, have you considered part time work doing something you enjoy as opposed to starting a business? By my calculations, if you could find a job working 20 hours a week at $15/hour, you should be able to meet your yearly need of $13,500. You need to do a self-assessment and decide whether you want to own a business, be self-employed (you own the job of mowing people's lawns), or work for someone else. All three have pro's and con's, but you should decide which of the three fit your desires and personality best.
4. Have you considered reducing expenses instead of trying to increase income? If you are not required to work, most folks are able to significantly decrease what they spend per month. Things like clothing, fuel, auto repair, eating out should all decrease as you no longer are required to do those things to work. Maybe a combination of both? You could try to reduce expenses by $6,500/year while increasing income by $7,000/year. Then you would have less pressure to work or start a business.
These were just a few of the thoughts I had after reading your initial post.
Some valid points but I am sure the kid in college is an expense that will go away.
If the wife is still working the OP likely wants something to do and generate some income.
My advice is to set up the old home office and get all the tax deductions that would come with it.
I also recommend that he keep prices up! even with low expenses there are many consideration.
IE think of the mower equipment as an investment. Now break down the cost of the mower, hand held and truck over 10,000 hours. That is your cost recovery period, then think about the interest rate you want to make on an investment.... this should beat the stock market. Say 10% a year is good.
So you want 10% a year on your initial investment plus the principle recovery over 10,000 hours.
Now add all your expenses insurance, fuel and maintenance. Allow some money to buy small tools, say 200 month. Break this down into an hourly rate.
so now we have two components of your hourly rate.
You want 16K per year so you need to make around 20K or $10.00 an hour but then again you are not going to work a full time job so triple it to 30.
I suspect when you do all the math you will be at or about 50 to 60 an hour minimum.