Business Plateau

Discussion in 'Business Operations' started by DAVELAWN, Feb 3, 2005.

  1. DAVELAWN

    DAVELAWN LawnSite Member
    from MASS
    Posts: 73

    Seems my business has plateaued the last couple years. I make a good living, don't get me wrong, but can't seem to get over a certain level. Usually have 20 percent growth per year, now am down for the last couple years to only 5 percent. Employ 2 fulltime and myself, plus 1 partime....can't seem to get enough work to get the partimer fulltime. My big problem I think is that I always lose at least one guy every year...not that someone pays better or anything, they seem to move across the country!...happened twice already......its that little hump I just can't seem to clear....any thoughts?
     
  2. J Hisch

    J Hisch LawnSite Senior Member
    Posts: 952

    if you are working all avaliable hrs you can and also your employee's you are maxed. Once you hit a certin level the only way to be able to increase revenue is 1. price increases 2. Make sure you are running the most effiecent way possible. 3. Sell more profitable work and let less profitable stuff go. Other than that it about all you can do unless your ready to add more labor and equipment, but then it takes time to build that up. That is the nature of the service industry.
     
  3. mastercare

    mastercare LawnSite Senior Member
    Posts: 289

    Welcome to Microeconomics 101.... The law of diminishing returns. As your business grows, each new hour of labor, or piece of equipment returns a smaller return than the previous dollar invested.

    The only ways to curb this naturally law of economics:

    1. Find a system that dramatically increases your efficiency.
    2. Significantly raise your prices (without losing customers)
    3. Offer a new service, or expand one that is currently minimal (this starts a new income stream, and therefore another growth period which eventually plateaus too).
    4. Evaluate your most profitable operation, and go full-till into that while eliminating less profitable business. i.e. If fertilizing is you best profit margin, sell more fert accounts, and get rid of some of those weed pulling jobs that just pay your labor costs, and only add a couple bucks to your bottom line.
     
  4. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Posts: 4,041

    Hi DAVELAWN,

    Wow! You really got some great responses here. Do any of these ideas interest you? Which one(s) would you be most interested in?
     
  5. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    1. Find a system that dramatically increases your efficiency.

    right here, like stated above is what I would do. Find a way to eliminate that part time worker by having more efficiency.
     
  6. Mycannon

    Mycannon LawnSite Member
    Posts: 98

     
  7. LLCO

    LLCO LawnSite Member
    Posts: 55

    What are the avenues that you are using to create your demand (word of mouth, direct mail, telemarketing, YP, etc?)
     

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