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can a medium size operation really make it?

Discussion in 'Lawn Mowing' started by bobbygedd, Nov 12, 2003.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    i've heard all too often, "stay small, or get real big, you can't make it, "in between"..." i've been tossing around some numbers, and am a bit concerened about what i'm seeing. as you know, 2004 will be my first year full time and fully reliant on the lawn biz to support myself and my family. this is my rough draft of 2004 projected totals, and it's not pretty. first off, i know what u guys are gonna say, but, i've come to the conclusion that i will have to bid about 10% lower than i've been, in order to compete, and build clientel. i know the "quality counts" theory, but that will help you build over time. as is now, i need a real client base, and i need it fast. even if i lower my bids by 10%, i will still be slightly higher than the competition. here goes: 60 lawns, at an average of $27 ea. x 28 weeks=$45,360. 20 fert programs @$275 ea.=$5500. 3 landscape projects @$2200ea.=$6600(this is after materials). 20 fall c/u@$225 ea.=$4500. 20 spring c/u@$125ea.=$2500. misc trimming etc.=$3000. total gross income =$67,460. now, expenses. 2 trucks @$1300. 5 mowers @$650. trimmers, wackers, blowers@$1000. work comp@$1500. ins on vehicles plus business liability=$3200. pest license=$550. accting fees=$800. repairs and maint=$1700. fuel =$1920. salary for employee=$12800. misc=$1000. total expenses=$25420. NOW....... gross income$67460 minus expenses $25420=$42040........$42040 divided by 52 weeks =$808. if i drain the account, i can write myself a check for $808 a week, after taxes, i'll take home $647 a week. not a very respectable income at all. in fact, i'd lose my home inside a year. i think the schedule i've come up with is very realistic for a first year full time operation. do my numbers seem correct, and, can u really make it as an "in between " operation?
  2. greensideup

    greensideup LawnSite Member
    Posts: 63

    Hey- i know your concerns. First, never lower your prices. If anything, go up a little. An average of $27 per yard is way off from here, unless maybe they are patio homes you can do in less than 30 min. I am originally from north jersey, and $27 is half or less than half than what i see charged for maintenance. I'm not sure where in NJ you are, but that figure stuck out like a sore thumb when i read it. I have less equip than you, but my gross is twice what you project yours to be. I have 2 full time employees plus myself, and one part timer. I need some more info from you to get into this further.
  3. dobehap

    dobehap LawnSite Senior Member
    Posts: 292

    You sir are srub!

    PS, you will be fine.

    Well, maybe.... how much is your morgage, bills, etc etc.
  4. TLS

    TLS LawnSite Fanatic
    Posts: 7,940

    I'm questioning your employee salary?

    Who is going to work for $12K a season?

    Then I question your repairs and maintenance at $1700?

    That would be a DREAM figure.

    But the MOST questionable figure has to be the $27/cut number. Are they all 2500 sq/ft lots? Thats a LOW number for ANYWHERE in the USA. Let alone the Northeast!

    Raise your $'s per cut. Increase your cuts.

    And by no means is your operation considered "medium". You are considereed small. Untill you have 3-4 crews and are doing 60 lawns a DAY can you possibly consider yourself "medium".

    With that work load (60 accts.) Why not just go it solo?

    Just some thoughts to ponder.
  5. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    the competition charges an average of $25 on our average lawns here. if u r good, u can gait to gait in 20 min, sometimes less. right now i'm at $30 for most props, the others are doin them for $25. i need to be more competative to get more work. i'm thinking of bidding a couple bucks less. can't live on $650 a week, bills are $800 a week:confused:
  6. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    tls, i dont want to go it solo cus i want to build. i can't expand without help. sure i want more than 60 lawns, but this is what i think i can get for next season. and believe me tls, u dont know what i'm competing against. big companies with major overhead doing 12 k lots with tons of wacking and edging, for a mere $25. it's sickening. my man will get $10 an hr, 40 hrs a week, that's how i arrived at his salary. the work season will average 32 weeks. repairs and maint for me average very little, that's how i arrived at the maint total
  7. pjslawncare/landscap

    pjslawncare/landscap LawnSite Bronze Member
    Posts: 1,410

    Dont know what or how much equipment you have but $1700.00 for repairs and maintenance seems real low unless major equipment is all under warrenty. I also allow for additional equipment purchases in my budget to meet growing goals as well. Employee saleries can vary greatly in that formula. I agree with Greensideup as $27 is low around here (Southern Indiana). $35 to $50 is normal for my res (3/4+ acre), but I have several larger I get couple hundred for and I (as of last year) used to turn away new yards not within my regular routes. Now I have several guys helping me so I am accepting a few more accounts
  8. little green guy

    little green guy LawnSite Senior Member
    Posts: 955

    Maybe try to pickup a few commercial accounts too or push more of the landscape installs.

    Also hope for a good winter to save some beans from snow plowing. Your gross seems like it's projected a little low even for a first year full time co., but so are your expenses.

    The truck and mower repair is low to me, once you start using this stuff all day everyday repairs go way up because the stuff takes more of a beating, I prolly average about 900 a month on repairs and stuff some months it could be 3k or maybe some times only 200 but it always suprises you. Also gas I average 6-700 a month.

    I think you'll be ok though somehow seems like work is always there.
  9. gogetter

    gogetter Banned
    Posts: 3,256

    What about mulch installs, and aerating/overseeding? That should be good for a few more grand a year at least.

    Did I read it right, one employee? Why two trucks and five mowers? Why not one truck and say 3 mowers?
  10. PAXLSI

    PAXLSI LawnSite Member
    Posts: 22

    This is my first year at doing lawn care full time. I avg. 50 lawns a week by my self and could take on another 25+ with no problems.
    So 60 a week would not be much. You will find that you have more time then you think.

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