Anyone ever had problems with payroll and cash flow?

Discussion in 'Business Operations' started by bwanderson79, Aug 9, 2013.

  1. cpllawncare

    cpllawncare LawnSite Silver Member
    Posts: 2,659

    Your either paying them too much, or again not charging enough resulting in a negative cash flow situation, so it looks like your making money but really your not. Another thing I've found is you really gotta watch your efficiency like someone said above, employees will drain you dry if you don't.
  2. larryinalabama

    larryinalabama LawnSite Fanatic
    Posts: 17,035

    Everyone business model and needs are different. Some of us Solo fellers have other interests also. Im approaching 50 and this is the perfect business for me.

    As far as the OP, I can say I know a lot of lawn fellers that have a employee and don't have the income to move out of their parents house. If I were young Id bust my azz 15 hours per day and get my persona and business finances in real good shape before Id even consider hiring anyone.
  3. RSK Property Maintenance

    RSK Property Maintenance LawnSite Bronze Member
    Posts: 1,486

    bingo! that's why I bought the new mower last year, new landscape trailer this year, new back pack blowers, and a new dump trailer and some other stuff while I'm living at home and my business related stuff is my only expenses! no employees and lovin it. but yes to answer the OP's question I did have cash flow issues last year and I was making a lot more money or it looked like I was anyways. but I was paying my part time employees too much money. So really I wasn't making much more money then I am this year and I'm doing a little less driving. definitely less work, and much easier on me to not have to deal with anyone else except my customers.
  4. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,353

    Why I appreciate input you an I are not on the same level and you do not know what its like to have a 26-30 week mowing season. Yet I bring in close to a quarter million every year. But lately I realized I could bring that in each year with just my partner and no employees. By shedding the extra work and cherry picking 160 accounts out of our nearly 200. Up here employees cost significantly more a 3 year vet expects 15 an hour. I have 10 year vets so take an average of 17 an hour then times it by 1.5 for ot then add on 20% for wc unemployment ssi and a few others and you see ot quickly exceeds 30 an hour real cost. The market will bare 60 an hour we charge it and it's not enough. Look I understand the faith in the employees make money model is very strong in some yet we now have 9,000,000 fewer jobs than when Obama was sworn in they just do not exist there gone. I may be late in realizing the futility of my employee pursuit but my eyes are open this year.

    As for doing this when I am 50 well I am 43 now and work rings around the 18-30 year olds that make up my employee base. I can and will work another 20 years plus in the field and if you feel you aren't capable of that then thats your limitation but I do not happen to share it.
  5. 32vld

    32vld LawnSite Gold Member
    Posts: 3,984

    I am 59 now. Come next May 60. I remember how my body was when I was 43. It is the rare person that can do what they did at 43and not ache when 59.

    If you are not making enough money your employees are not working efficient enough, fast enough, paying them too much, not charging your customers enough, any combination or all of them.

    When you get older you will find it hard to keep the same pace. By the time you hit 62 you will need to have your retirement needs met. Whether to cut back hours, have a helper.

    Or send out a two man crew and you just handle the management and non field work so they are more productive.

    Or make enough money before you hit 62.
  6. larryinalabama

    larryinalabama LawnSite Fanatic
    Posts: 17,035

    Everyone is different, one of my competors is 60, he can work circles around anyone that I know. My goal is too slow down a little in a couple of years, the only way Ill hire someone is if Im unable to move around.
  7. Efficiency

    Efficiency LawnSite Bronze Member
    from zone 6
    Posts: 1,551

    ........... Nm
  8. Mark Oomkes

    Mark Oomkes LawnSite Fanatic
    Posts: 12,422

  9. Efficiency

    Efficiency LawnSite Bronze Member
    from zone 6
    Posts: 1,551

    Can't fix stupid. Figured id save my typing.
  10. Will P.C.

    Will P.C. LawnSite Senior Member
    Posts: 965

    Payroll issues are serious as that is likely where most of your cash flow is going.

    Some of the bigger companies have systems in place where the newest workers get sent home, have to call in to see if needed, etc when you aren't dealing with steady work and have problems like mother nature that no only effect your ability to work, but your sales as well.

    Sometimes you have to make the call to scale back on employees while other times you have every hand on deck working overtime.

    This is a seriously complicated issue where the number of variables at play is huge.

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