bills & payroll

Discussion in 'Business Operations' started by sixpixels, May 1, 2012.

  1. sixpixels

    sixpixels LawnSite Member
    from NJ
    Posts: 29

    Patriot Services- I dont think your being a dick..lol I mean the whole idea of this forum is for people to help each other in this business. Now to answer your question... I know what my costs are for like insurances, rent, fuel, supplies etc etc..but i think my issue is im not sure how to take all this info and figure out accuratly what I should be correctly charging by the hour etc etc..so yes you are correct..
     
  2. Mike NY

    Mike NY LawnSite Member
    from NY.
    Posts: 84

    A good billing/ accounting program like Quickbooks pro will have reports for invoices due, expence reports, payroll reports, profit and loss reports, year to date reports, last year comparisons. etc..
    This should give you all the insight You Need To KNOW where Your business stands and how profitable you may or may not be.
     
  3. sixpixels

    sixpixels LawnSite Member
    from NJ
    Posts: 29

    i just got quickbooks for mac. Im learning how to use it as we speak. My only issue is I use another applciation for my customer accounts and billing which does not integrate into quickbooks..
     
  4. jc1

    jc1 LawnSite Bronze Member
    Posts: 1,571

    80 hours of over time a week will suck you dry if your paying legally time and a half. You need 2 or 3 more employee's. You will get more work done and be more profitable.
     
  5. snomaha

    snomaha LawnSite Senior Member
    from midwest
    Posts: 874

    My experience has been that there is a big difference between cash flow and profit - seen a lot of profitable businesses go bankrupt because they couldn't' cash flow operations.
    Profit - are you factoring in a fair market wage for your self? The numbers are lying to you if you aren't paying yourself a fair market wage or least figuring in what it would be. Said it before in this forum - you get paid a wage for what you do in your business and get a return on what you own.
     
  6. Efficiency

    Efficiency LawnSite Bronze Member
    from zone 6
    Posts: 1,537

    For sure. Ive been to known to send crews to profitless jobs if the cashflow proposition was attractive back before I had a decent cash position.

    If you want to lay this our there, myself and a few others already posting in this topic would surely have the kindness, honesty, and knowledge to help you figure this mess out. Myself, Id like to know what your monthly obligations are in terms of rent, payments, salary for you, etc. Spell those out and we can help you towards an hourly cost to see if you are even getting running in the black.
     
  7. gcbailey

    gcbailey LawnSite Silver Member
    from WV
    Posts: 2,561

    ya, when you think you know you costs, there's probably really at least half a dozen more you are overlooking. I know a guy who would buy his crew, between 4 to 6 guys and himself lunch everyday at a fast food place. That would run at least $40 x 5, 6 days a week throughout the month. He was spending close to if not over a grand a month on food for his guys. He couldn't figure out how he was loosing money. He's a good boss and a good guy who tries to take care of his guys, but he was being too good, if you know what I mean. Now it's they buy their own lunch and he still will go to Sam's Club or somewhere and buy some bulk drinks and snacks if need be to try and help out.
     
  8. Mountain Peak

    Mountain Peak LawnSite Member
    Posts: 203

    WHen I was doing that many accounts I ran into this as well. The things that come to mind for me are:
    1. you aren't charging enough. If you have an 8 month season you need to make enough to cover you for 12 months in 8. You should be building the account each month, not draining it.
    2. employee management needs to be looked at. Get rid of or hire more employees. I would never get to 50/60 hours a week per employee. Overtime is the friend of the employee, not the employer. I also made the mistake of having a three man crew doing what a two man crew should have been doing.
    3. look at simple things like fueling the equipment. I noticed my guys would take 30 minutes to fill up fuel twice a week. A three man crew that is three hours a week, 12 hours a month of paying them just to fill up. UNPRODUCTIVE TIME!
     
  9. snomaha

    snomaha LawnSite Senior Member
    from midwest
    Posts: 874

    Do yourself a favor and get the book - "Simple Numbers, straight talk, big profits" by Greg Crabtree. He does the best job of simplifying why labor productivity is the key to profitability as well as breaking down cash flow in easy to understand language.
     
  10. snomaha

    snomaha LawnSite Senior Member
    from midwest
    Posts: 874

    I'm not an accountant and free advice is worth as much as it costs.

    Our office generates a weekly dashboard of financial indicators and A/R turnover is one of our measures (accountants use the term day sales outstanding).

    example: Lets say you had a 60 day window of sales that equaled $100,000 - at the end of the same 60 day period you had a total AR balance of $50,000.
    $50,000/$100,000 X 60 days = 30 days.

    This number tells me that I turnover my total AR every 30 days. We found it to be a good measure of customer satisfaction as well as customer credit policy.

    Higher number equals cash flow problems lower number equals money in the bank!
     

Share This Page