Cost Of Business

Discussion in 'Starting a Lawn Care Business' started by MrFangs, Aug 9, 2005.

  1. MrFangs

    MrFangs LawnSite Member
    from Zone 8
    Posts: 119

    I have already used the search for this, but can't find a straight answer. People are giving a bunch of random numbers and I'm not sure what they mean.

    How much do you pay Uncle-Sam? I read someones post that said he takes 40% of your income. What about when you have workers? How much is it to hire a worker or two?

    It seems like you have to charge $100 per yard to make a dollar. ;)

    How does JustLawns stay in business charging $18 a lawn? I heard that company has QUITE the routes too. (Lots and lots of properties)

    Please help!
     
  2. 65hoss

    65hoss LawnSite Fanatic
    Posts: 6,360

    Every company is different. No 2 will be the same. I may have G/L insurance that is cheaper than someone else and they may have a mower cheaper than mine. Everyone has a different number that is their fixed and variable cost.

    Taxes...well they are complicated. The way the business is setup, the number of deductions, the total revenue and cost numbers vary, and the tax bracket you are in make the tax situation a little different. If you have a wife that works and then you have to add the 2 incomes together...that can push you into a different bracket. If you are self employed then you have a self-employment tax. You have SS taxes. The list goes on.
     
  3. topsites

    topsites LawnSite Fanatic
    Posts: 21,653

    Yes, I agree, there is no specific way to define cost and the reason you get such a wide range is because:
    SOME ppls define cost as fuel + equipment only, not because that's all they pay but because that is how they think.
    Others add labor, and maybe tax.
    Still others may add after-hours maintenance time, estimate time, windshield time.
    The list goes on, you can add bank deposit time, advertising cost, omg there is NO end, it never ends, you really gotta charge like 50,000 dollars / cut BUT no, it's not that bad, in the end it's a whole LOT of nickels + dimes, the solution is you will need to stay pretty busy most of the year so you are cutting more than 1 lawn per season :)

    But no, it's not as easy as it looks, heh
     
  4. jfb1060

    jfb1060 LawnSite Member
    Posts: 14

    How does anyone do a lawn for $18.00 even if its small??? I do this partime and can't get away with that kind of number unless I could chop the price against the volume of work I would do in a given month.

    I would think that even with negligable insurance costs, etc. that you still would have a really bad time making a number under $25.00 per lawn as residential.

    Would this be correct or am I all wet here???

    Joe in Florida
     
  5. bruces

    bruces LawnSite Senior Member
    Posts: 648

    Tax rates vary with income levels. Payroll taxes are same for federal, but vary by state. You need to get a handle on what you are making, net and then sounds like you could use a tax adviser to help you out on the tax end, and if you get employees, have a cpa or payroll service handle your payroll and payroll taxes to keep you out of trouble.
     
  6. MrFangs

    MrFangs LawnSite Member
    from Zone 8
    Posts: 119

    How difficult can they make it to mow lawns? Honestly. :rolleyes:

    I would love to charge $25 per mow, but you can't do that. There are scrubs around here charging $10/ANY YARD. People don't like the 250% increase. :(

    I need to kidnap Justmowit's management/advertisement team! :mad:
     
  7. out4now

    out4now LawnSite Bronze Member
    from AZ
    Posts: 1,796

    Good luck getting them to hold still long enough to get the net over them. :p
     
  8. PTP

    PTP LawnSite Bronze Member
    from Tulsa
    Posts: 1,383

    As mentioned earlier, you get taxed on the NET that you make - not the GROSS. The IRS website should tell you what percentage you will have to pay - it depends on how much you make.

    Talk to an accountant about deductions. The object is to get your net income as low as possible. You can do this by deducting you mileage, insurance, mowers, fuel, and all business related things. This will dramatically lower your net income and thereby lower the amount of taxes that you have to pay.
     

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