Register free!

The Green Industry's Resource Center



Reply
 
Thread Tools   Display Modes
  #1  
Old 05-16-2012, 02:16 AM
Firebrigade Firebrigade is offline
LawnSite Member
 
Join Date: Apr 2012
Location: Manhattan, KS
Posts: 12
Profit Amount?

This is my first year maintaining lawns professionally and I know I've bid several of the properties too low. However, after running my numbers I found that I'm still well in the black, but making a profit of only around $8 per hour. My question is how much profit do you veterans generally accrue per hour?
__________________
'06 Dodge 1500
10' Maxey trailer
'08 34" Gravely Zero Turn
Honda push
Tanaka trimmer
Tanaka edger
Echo backpack blower

www.firebrigadelawncare.com
Reply With Quote
  #2  
Old 05-16-2012, 02:23 AM
Duekster Duekster is offline
LawnSite Fanatic
 
Join Date: Jan 2007
Location: DFW, TX
Posts: 7,971
Quote:
Originally Posted by Firebrigade View Post
This is my first year maintaining lawns professionally and I know I've bid several of the properties too low. However, after running my numbers I found that I'm still well in the black, but making a profit of only around $8 per hour. My question is how much profit do you veterans generally accrue per hour?
What are you including and excluding in the profit?

10% is a very good profit provided you are including fair wages, including for yourself, overhead and equipment plus interest and inflation in your cost. If you are including all those things ( all cost) , 5% is a fair profit in this economy.
Reply With Quote
  #3  
Old 05-16-2012, 02:45 AM
Firebrigade Firebrigade is offline
LawnSite Member
 
Join Date: Apr 2012
Location: Manhattan, KS
Posts: 12
Quote:
Originally Posted by Duekster View Post
What are you including and excluding in the profit?

10% is a very good profit provided you are including fair wages, including for yourself, overhead and equipment plus interest and inflation in your cost. If you are including all those things ( all cost) , 5% is a fair profit in this economy.
I couldn't tell you the percentage off hand, but my situation is somewhat unique in that I haven't started to "pay" myself yet. My main profession is being a firefighter, so thus far all the money I make mowing that's not an expense has been reinvested into the business in the form of savings. Basically if I did pay myself I'd be making roughly $8 per hour. This amount is well below what I'm after.
__________________
'06 Dodge 1500
10' Maxey trailer
'08 34" Gravely Zero Turn
Honda push
Tanaka trimmer
Tanaka edger
Echo backpack blower

www.firebrigadelawncare.com
Reply With Quote
  #4  
Old 05-16-2012, 03:29 AM
Duekster Duekster is offline
LawnSite Fanatic
 
Join Date: Jan 2007
Location: DFW, TX
Posts: 7,971
Quote:
Originally Posted by Firebrigade View Post
I couldn't tell you the percentage off hand, but my situation is somewhat unique in that I haven't started to "pay" myself yet. My main profession is being a firefighter, so thus far all the money I make mowing that's not an expense has been reinvested into the business in the form of savings. Basically if I did pay myself I'd be making roughly $8 per hour. This amount is well below what I'm after.
That is not profit then is it? Profit is what you make from taking the risk and making the investment, not your labor.

Think about paying someone else.... then what would you make from the investment after expenses. That is the profit. You could not pay someone 8 an hour to do the job.

Much less, why invest that money to get a job that pays you what you make at a fast food joint without an investment.

You would be better off investing that same money in a CD or stock market and then taking a part time job instead.
Reply With Quote
  #5  
Old 05-16-2012, 06:52 AM
Firebrigade Firebrigade is offline
LawnSite Member
 
Join Date: Apr 2012
Location: Manhattan, KS
Posts: 12
Quote:
Originally Posted by Duekster View Post
That is not profit then is it? Profit is what you make from taking the risk and making the investment, not your labor.

Think about paying someone else.... then what would you make from the investment after expenses. That is the profit. You could not pay someone 8 an hour to do the job.

Much less, why invest that money to get a job that pays you what you make at a fast food joint without an investment.

You would be better off investing that same money in a CD or stock market and then taking a part time job instead.
Well OBVIOUSLY I plan to make MORE than that Duekster. Just like the stock market, I took a risk investing in my own business. I chose to put that money into a venture I could hopefully control more than the stock market by some good ole fashioned American hard work and dedication.

OBVIOUSLY I'm new to this business, and I'm far from having it figured out, but thats's the beauty of entrepreneurialship. I have the chance to fail or succeed based more upon my own actions rather than the actions and reactions of others, just like every other company on the stock exchange, and probably a vast majority of the users on this site.

Apparently you've forgotten what it's like being the owner of a fledgling company, or never really knew to begin with, because you could've answered the question as to "why do it?" on your own if you had any idea what you were talking about.
__________________
'06 Dodge 1500
10' Maxey trailer
'08 34" Gravely Zero Turn
Honda push
Tanaka trimmer
Tanaka edger
Echo backpack blower

www.firebrigadelawncare.com
Reply With Quote
  #6  
Old 05-16-2012, 09:20 AM
Duekster Duekster is offline
LawnSite Fanatic
 
Join Date: Jan 2007
Location: DFW, TX
Posts: 7,971
Quote:
Originally Posted by Firebrigade View Post
Well OBVIOUSLY I plan to make MORE than that Duekster. Just like the stock market, I took a risk investing in my own business. I chose to put that money into a venture I could hopefully control more than the stock market by some good ole fashioned American hard work and dedication.

OBVIOUSLY I'm new to this business, and I'm far from having it figured out, but that s's the beauty of entrepreneurialship. I have the chance to fail or succeed based more upon my own actions rather than the actions and reactions of others, just like every other company on the stock exchange, and probably a vast majority of the users on this site.

Apparently you've forgotten what it's like being the owner of a fledgling company, or never really knew to begin with, because you could've answered the question as to "why do it?" on your own if you had any idea what you were talking about.
No I have not, but I wanted to make sure we were discussing the same thing.

I understand why you did it too. However cynical I was being, I think maybe you got my point. If you work for free then you can count the $8.00 hour profit.


What is fair profit for the risk you are taking? It is going to be different for everyone, this is where we talk about a built up rate. What could I make elsewhere? Do I want to make that plus inflation? You build up all these various factors and your risk tolerance for your investment and determine the fair profit % you want to make.

My point about hiring someone is a valid point! You have this equipment, it needs to run to generate your equipment. Just assume you have to hire someone to run the equipment and all you did was sales, grow the business and the adminstrative work.

What would you need to make off the guy you are paying 10.00 and hour to cover the company share of employement taxes? And to pay you a little something for your sales, and back office work?


No one invest their money for free and no one works for free. Both of those things need to generate a fair about of return independent of each other. Even if your equipments is paid for, then you are charging for the cost of the next replacement piece of equipment at the anticipated future price.Yet we see it happen all the time in the this industry. Two people suffer, the guy who invested his savings and not properly charging then ultimately goes out of business and his competition.
Reply With Quote
  #7  
Old 05-16-2012, 10:10 AM
Mikegyver Mikegyver is offline
LawnSite Bronze Member
 
Join Date: Jan 2010
Location: Longview TX
Posts: 1,803
If it makes you feel any better we charge 30.00 a hr per guy or 60/2 guys. Does not matter if its running a mower or digging a ditch...we charge the same rate. So far its gone over well and I plan on raising it to 35.00 later this year or early next year.
Mike
__________________
High end commercial, multi-family and residential lawn care, irrigation (LI and BPAT), and landscaping.
Mikegyver Pics Thread
Reply With Quote
  #8  
Old 05-16-2012, 09:52 PM
muddywater muddywater is offline
LawnSite Bronze Member
 
Join Date: Sep 2011
Posts: 1,813
What are you charging or averaging per man hour?
Reply With Quote
  #9  
Old 05-17-2012, 01:45 PM
Johnny test's Avatar
Johnny test Johnny test is offline
LawnSite Senior Member
 
Join Date: Dec 2006
Location: Lexington,KY
Posts: 568
Take about 9-10% of your total earned revenue for the year and divide that by total hrs worked for the year and that's about average. $8.00 sounds sky high. Or your overhead is not calculated correctly.
__________________

97' ISUZU NPR (16' bed)
John Deere F687 60" 7iron w/MCS
John Deere GS30 36"
John Deere GS45 48"
John Deere JS45 21"
Stihl FS80 Pro Trimmer
Stihl FS46 Trimmer
Stihl BG55 Blower
Stihl BR56 X2
Stihl BR600 X2
Red Roo Auger
BRD-280 Bed Redefiner
Echo PE-280 Stick Edger
Echo SHC 212 Hedge Trimmer
Bluebird 24" De-Thatcher
Olathe 88 Plug Aerator
Yard Machines walk-behind Edger
Craftsman Lawn Vacuum/chipper
2-Homelite BP250 backpack blowers
McCullock FR56 Trimmer


Reply With Quote
  #10  
Old 05-17-2012, 01:47 PM
Johnny test's Avatar
Johnny test Johnny test is offline
LawnSite Senior Member
 
Join Date: Dec 2006
Location: Lexington,KY
Posts: 568
Take about 9-10% of your total earned revenue for the year( if you dont this number then stop mowing and jump in a chipper) and divide that by total hrs worked for the year and that's about average. $8.00 sounds sky high. Or your overhead is not calculated correctly. Or you don't understand what actual profit is.
__________________

97' ISUZU NPR (16' bed)
John Deere F687 60" 7iron w/MCS
John Deere GS30 36"
John Deere GS45 48"
John Deere JS45 21"
Stihl FS80 Pro Trimmer
Stihl FS46 Trimmer
Stihl BG55 Blower
Stihl BR56 X2
Stihl BR600 X2
Red Roo Auger
BRD-280 Bed Redefiner
Echo PE-280 Stick Edger
Echo SHC 212 Hedge Trimmer
Bluebird 24" De-Thatcher
Olathe 88 Plug Aerator
Yard Machines walk-behind Edger
Craftsman Lawn Vacuum/chipper
2-Homelite BP250 backpack blowers
McCullock FR56 Trimmer


Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump





Powered by vBulletin® Version 3.8.6
Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
Copyright ©1998 - 2012, LawnSite.comô - Moose River Media
All times are GMT -4. The time now is 08:33 PM.

Page generated in 0.07220 seconds with 7 queries