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. knox gsl

    knox gsl LawnSite Platinum Member
    Posts: 4,850

    This is my second season with my own business and this has reassured me that I am headed in the right direction. The best advice I could give anyone is don't get tied up in payments, take care of your equipment and pay cash. Only keep the customers that are profitable and always provide additional services. I've picked up 3 customers this spring to other LCO's just being a "mow and go" they were passing up good earning jobs. There is nothing wrong with driving an older truck, high hour mower or worn timmer, as long as it runs well. The time to replace is when it has left you hanging several times and is no longer profitable, then go replace paying cash. The customer doesn't care about the sweet F350 4*4 with all the upgrades and would most likely not care how many hours are on your mower. Impress people with your quaility of work, clean appearance and good work ethic. Last thing when it's time to replace X? equipment check C-list there are plenty of guys trying to sell low hour euipment to get out from under payments.
     
  2. TCP1

    TCP1 LawnSite Member
    Posts: 10

    I completely agree with the dreaded "midpoint" idea. You grow to where you work your ass off....off....so to grow anymore you need more....help, equipment, etc....then you need more customers, etc. then everything better go right, because if you get behind due to rain, equipment problems, etc. you might have to mow a property twice, or at least slower because the grass is so tall, and all of that cuts into profits and stretches everything. To the point that it is true....you just hang on and hope.
     
  3. Knight511

    Knight511 LawnSite Member
    Posts: 207

    I think when the midpoint is reached and the time has come to make the decision to go big or go home... one really needs to look around them. Doubling employees and such will not give you any additional free time. How is your quality of life? Are you happy with your life, the things you have, the time you have with friends and family, etc.... if you are happy, it may be best to stay "small" and just enjoy what you have.

    I think a lot of people make mistakes by trying to fuel their ego. I see a lot of references to the big bad trucks and such but think of all the other things a LCO has that is really NEEDED to stay in business and be profitable on the scale they operate on. From $10K mowers to the $40K F350, often times we (yes all of us, including me) do things and buy things to fuel our egos. Just because you CAN make X more money with bigger, badder Y piece of equipment does NOT mean you ever will. When you lose sight of this, you will justify spending twice as much as what you really need on something just to be able to say you have "Brand X Mega Mower" or whatever... I mean... look at most signatures here... it is a veritable sausage comparison with out equipment. :D

    Still a scrub. Still happy. :)
     
  4. LwnmwrMan22

    LwnmwrMan22 LawnSite Platinum Member
    Posts: 4,372

    I fell into this trap.

    This is year 21. I have (2) 2006 Dodge 2500s, a 2007 Dodge 3500 crew cab dump, (2) 24' enclosed trailers, a 14' dump trailer, a 26' flatbed trailer, (2) Kubota ZD331 / 60, a Kubota ZD331 / 72, a Toro Grandstand, along with all of the other bills that come with 2 houses, 20 acres of land, wife's new car, 2 kids, etc.

    I work 7 days / week, with 2 employees that work full time, as well as a wife that helps 2 days / week and a father that helps 2 days / week.

    I hate it.

    I sold one of the 24' trailers a week ago, and am looking at selling either one of the 2500's or the 3500 around August, just before snow season starts to get rolling.

    I'm going back to being small. The most money I ever had was when I first got married 11 years ago. I went from 6 employees and 130 accounts / week to myself and 30 full service, the most profitable / fastest paying accounts I had.

    Over the last 11 years I kept getting phone calls / inquiries on adding work and I would usually tell them not interested. However, they would be neighboring properties or properties that a current owner would acquire so I would add them, after all I didn't want someone else to have access to the property I was currently doing, through this new property.

    Then 2 years ago the township merged with the city. Also, the senior high of the school district that I and my dad mowed added about 40% to their then current turf area.

    Also, I broke my foot that summer, and my cousin lost his job.

    I hired my cousin, as well as a couple of other acquaintances that I knew were good workers and needed a new job while my foot mended. I liked the idea of just working 8-5 Monday through Friday, no more 100 hour weeks.

    I figured this would be the perfect time, with all this extra work (the township had 8 parks, the city had 19 parks, plus all of the common areas throughout the city, ie city hall, library, etc).

    I crunched numbers and crunched numbers again, and came up with a decent wage to offer 2 of the better of the guys, something they could actually support their family on, and I could work less hours.

    What I didn't factor in was all the extra repairs. Seriously, ALL of the repairs. I knew what my numbers were on average for repairs when I worked by myself. I'm hard on my equipment with minimal maintenance, so I had a fair amount of repairs that could probably have been prevented.

    However, once I had these 2 guys working, it was just odd stuff that would break. The tailgate on the truck was completely bashed in one day. It looked like someone put the tailgate down on the trailer jack and jumped up and down on it. Neither would admit to what happened. "I don't know".

    One day a trimmer came home broke in half.

    Then there's the "we had to quit early, so and so needed to be off by 4" even though they were 15 miles from home and left 1 yard to do, 15 miles from home. More drive time.

    It's the unknown that no matter how often you crunch numbers, you'll never crunch them right. It's much like the saying if you're going build a shed, build it twice the size you think you need".

    Anyways, the end of last fall I laid the guys off. One I hired back this year, the second went to work for the city. The one I hired back, I already told him that if he comes back next year, I'm cutting his wage from $18 / hour to $10 / hour.

    I cannot afford a decent wage and still pay for these repairs that would be caused by someone that you have to babysit.

    I've always believed you need to be solo with 1 part time helper, or have 6+ crews running, so you can afford to have 1 mechanic, plus pull guys from whatever other crew to keep all of the crews running.

    If you run with 3-6 guys, you're going to struggle.
     
  5. CheapScapesNC

    CheapScapesNC LawnSite Member
    Posts: 36

    What I have seen is that LCO's that only mow can fail quick unless they are on top of their game. Mowing is low margin - it is nice steady income but do not become dependent on it. We get 50%+ margins on our landscape design biz, hard scaping(mainly pavers/stone), and pond business. Plenty of room for overhead and unforeseen repairs/expenses.

    Know your market, know what is needed, do something different than your competition.....market it correctly and you will succeed.
     
  6. logan

    logan LawnSite Senior Member
    from FL
    Posts: 315

    I went through the same thing. I sold my business 2.5 years ago and the debt has increased so much, that I recently filed bankruptcy. I will never run a business like that again. I too, think that a solo business is the best way to go, but you can't run at that pace forever, without breaking your body down. I decided to run my own sales company, and now I am making more money than ever and I love it.
     
  7. LwnmwrMan22

    LwnmwrMan22 LawnSite Platinum Member
    Posts: 4,372

    In my market, the landscape / pond business has dried up, no pun intended.

    This is part of the problem. The guys that used to laugh at me, because I only did maintenance, are now out doing maintenance at a cheaper rate, just to keep their house.

    The school district that I mow (5 schools), last year the snowplowing went out to bid for $15,000 for the season. My bid was $36,000. I have a set of 3 banks that I get $13,000 for the season for the plowing.

    This biggest problem with grass cutting is it has a ceiling as to how much you can charge.

    You reach that ceiliing after about 10 years on a site. It either gets too high and too easy for someone to underprice you, or the owner ends up figuring it's now cheaper to do it themselves.

    Now you either have to figure out how to restructure your business to match the price point by cutting your own costs, or you have to make up for it in volume.

    With the law of diminishing returns, you'll never be able to make up for it in volume, unless you can land high paying accounts where you can park 3-4-5 guys / day at it.

    Even those are becoming too comeptitive, since everyone else, besides those reading this post, realize the same thing.
     
  8. South Florida Lawns

    South Florida Lawns LawnSite Platinum Member
    from usa
    Posts: 4,785

    best thread on here people need to read this and take the advice given!
     
  9. Lefet

    Lefet LawnSite Bronze Member
    Posts: 1,887

    Totally agree. This should be required reading for the new and old. I feel quite fortunate to benefit from the wisdom. Everybody can learn something from somebody at some time.
     
  10. M.A.Landscaping

    M.A.Landscaping LawnSite Member
    Posts: 177

    totally agree, hearing things like this really get you thinking, and thinking hard thanks, you really opened my eyes on what could happen
     
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