How to fail in the lawn business by someone who did it.

Discussion in 'Lawn Mowing' started by PROCUT1, Feb 18, 2009.

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  1. delphied

    delphied LawnSite Silver Member
    Posts: 2,067

    My area has been depressed for years and the lawn mowing business has been overtaken by solos and guys that work for beer. Thats the future of this business too. I saw a plow truck the other day with a sign that said any driveway $15. I wouldnt bother putting a plow on for that. You could get more to cut ten years ago than you can now and guys on here are talking about lowering prices this year. These guys are their own enemy and they dont know it. This line of work is doomed.
  2. qualitylandscaping

    qualitylandscaping LawnSite Bronze Member
    Posts: 1,581

    My rule for landscape equipment purchases:

    We will not buy a piece of equipment until we have "purchased" it in rental fees over the expected life of the machine.

    Say we're talking about a cut off saw.

    Cost to buy $900
    Cost to rent $50/day
    Avg saw life 4 years

    If we didn't rent that saw for 18 days over a 4 year period, we won't buy it.

    Now if I get into a lot of work, and don't see an end to the demand, I may go purchase that machine before I meet my own criteria. Say we're working on a big hardscape install that will take 10 days to complete and I have a job lined up right after that for 3-4 days worth of saw work. I may go out and buy it before I start the first job, only knowing that it will be paid for right away.

    People that go out and buy a backhoe because they want/ think they need one are only asking for trouble. I see ad's online all the time for guys advertising "I just bought a new backhoe and need to keep it busy". Thats a straight line to failure. You need to have the work, and a justifiable amount of it before you buy something.
  3. letsplay

    letsplay LawnSite Member
    Posts: 95

    I agree that a business plan is important but you can have the best business plan money buys but if you are not on top of it, and constantly ask "what can I do better, what is not working for us etc" you are fooling yourself.
  4. TScapes

    TScapes LawnSite Senior Member
    Posts: 453

    GREAT POST! I have been in management for several Large companies and I know several owners of firms now that are in the 3-5million range that have told me in private that if they could do it all over again.... they would do it solo or with only a couple of workers. That's it!

    I have seen soooooo many multimillion dollar firms operate in the red year long. We used to have sales meetings about raising our prices on ALL new accounts and having a minimum monthly dollar amount. They were even screened over the phone by the office girls. Our sales goals were HUGE!! But we came close to meeting them every year. But guess what.... we could sell over a million each and we were still in the red at the end of the year!!!

    I tell people ALL DAY, Every Day..... know your costs! Understand your costs!! Live your costs!!! Going out and going in debt to get into business is foolish and reckless. But most of us still do it. It's a mower here... blower there... tree here.... flower there. Customers that normally pay every 15, well now they are net 30. That messes with your cashflow. What you have said is true. Most people have been there or are there.

    This is exactly why I FINALLY went on my own. When I started and to this day, I have no intentions of being big. I turn down work so I can stay small. I like being solo plus one. The biggest I ever want to be is one crew maintenance and one install. But that is far far away. Keep preaching Procut!!!!
  5. qualitylandscaping

    qualitylandscaping LawnSite Bronze Member
    Posts: 1,581

    Alot of guys I know in the business, including myself operate without a business plan. I believe they are only worth as much as the paper they are written on. When you're first starting out, they may help.

    Whats more important are the financials (cash flow forecasts, budget planning, etc). Just writing down you want to shoot a goal for "x" number of lawns is really a waste of time in my mind. If you know what you want to do, and know how to react to problems; a business plan is unnecessary.

    I would read a book about business, before I wrote my own business plan.

    Thats just me though.:dancing:
  6. letsplay

    letsplay LawnSite Member
    Posts: 95

    QualityLandscape, You are right on with purchasing equipment. I have the same reasoning with tools like saws that will pay for themselves quickly or you are paying more to go back and forth to the rental shop and renting alot.
    That large skidsteer or backhoe is not making you money sitting at the shop but I cant tell folks getting starting enough not to do this..........but that is my 2cents. I hate it when I get a call up from them looking for work or they will lose their tractors or trucks or if I am interested in purchasing them....We buy used so their loss is our gain sometimes but I don't like seing anyone go out of business.
  7. qualitylandscaping

    qualitylandscaping LawnSite Bronze Member
    Posts: 1,581

    Yep. The backhoe story is true. I actually got a call from the guy, who had posted that ad on Craigslist. Asked if I would be interested in splitting payments and use of his machine 50/50. Now why would I do that? I could just let him keep his mistake, go out of business, and buy the thing outright for the 50% I would have given him to share it!

    People dont think.....:hammerhead:
  8. letsplay

    letsplay LawnSite Member
    Posts: 95

    Tscapes I have had friends working for multi million dollar companies and they are miserable. I have never understood large companies that boast large sales figures for the year but their body language totally changes when you ask about profit........I had a chance at a younger age to work for a large national company when they started up in our area and thought it would be great. I had worked for myself for a few years and things just went flat with our business for a while so I looked else where. I asked about the hours I would work and salary/benefits etc. I got one story from management and then talked to an employee after hours. 80 plus hour weeks during peak season less money (profit) then I was already making and more responsiblity/more headaches. I already worked those kind of hours and made more money and got to still be out in the field getting my hands dirty building stuff. Guess the point is why do you want to get so big that you work miserable hours, make less profit, lose your marriage or friendship with others. I know that not all large/medium companies are like this but most employees or owners I have talked with say their companies are sucking the life out of them and their money. Good luck with your business and dont let all this advice scare you off. Their is good advice here even if some of the stories have led to failure. But look what some people have done with that failure.......helped some of us that are riding the fence or think we are the only ones going thru this.
  9. letsplay

    letsplay LawnSite Member
    Posts: 95

    Wow...the craigslist add you mentioned, I had to read it twice to believe that happened. Can't beat that story. Did have one guy I was looking at his trailer and he was like I really need the money blabla to pay bills but I wont sell it to you if you wont give me the chance to buy it back in a couple months...............uh, uh, da, yea let me get back to you on that expensive rental and the land forsale on the moon! :dizzy:
  10. All Seasons Landscaping

    All Seasons Landscaping LawnSite Member
    Posts: 42

    Great thread, both the original post and all of the responses. As someone new to being full time in this business, I was already falling into the trap in my head. Well, if I can make this much with me and another guy in one truck, I can make so much more by adding two more guys in another truck, then two more guys in another truck, etc.

    This thread has provided invaluable insight, and I'm going to hold off on adding crews until I know it's what I really want, and am ready for everything that comes along with it... and that's if I decide I really even want that.
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