Is this realistic Money?

Discussion in 'Lawn Mowing' started by Love Thy Neighbor, Nov 25, 2002.

  1. Love Thy Neighbor

    Love Thy Neighbor LawnSite Member
    Posts: 33

    Hey all

    I've done some calculations on what I would like to do for next year. Tell me if this is realistic money. If I have left something out or if there is anything that you can think of to make this more of a reality please add in your thoughts or comments.

    Here is my Goal.

    We have a lot of Commercial business all over Milwaukee and the suburbs so that is my target market.

    1. 20 jobs at $120 per trip = $2400 per week
    2. $2400 x 30 trips = $72,000 for the year gross.
    3. My part-time helper at $10pr hr at 6hrs for 5 days= $300prwk
    4. $300 x 30 wks = $9,000 pr yr for helper
    5. $72,000- $9,000 = $63,000 gross for year
    6. $63,000- 25% for taxes = $49,250 for me net.
    7. Subtract a couple thousand for expenses.

    Is this for real if I had these accounts and a pt helper.
    Of course I would work part time and keep my fulltime job for now.

    Is taxes 25% ? And should I be taxing my customers at 5%

    Thanks.


    :cool:
     
  2. KenH

    KenH LawnSite Bronze Member
    from CT
    Posts: 1,622

    You might be a bit low on the expense part. You probably have a 'couple thousand' worth of gas receipts.

    What about contractor and auto insurance??
     
  3. greenman

    greenman LawnSite Addict
    Posts: 1,405

    Those are some big jobs for $120 each. As far as taxing your customer a 5%, its different in every state and city. Probably a bit more. Your expenses are too low, at least double or almost triple that. You will have breakdowns, and you may need to buy an extra mower, who knows. Your goals are high, but they are realistic. Dont forget about business license, maybe applicators license, liabilty insurance, auto insurance, accountant fees, advertising fees, etc. Good luck and have fun!
     
  4. MacLawnCo

    MacLawnCo LawnSite Bronze Member
    Posts: 1,847

    Id be very surprised if you could get in 30 cuts per year being that far North. I think a much better approach would be to factor your budget with low 20's to account for drought, short year etc. You are forgetting about the other parts of the GREEN INDUSTRY. Think hard about that last sentance.
     
  5. greenman

    greenman LawnSite Addict
    Posts: 1,405

    :eek: I overlooked the sentence about the part time work. No way you make those numbers and do that part time.
     
  6. Green Pastures

    Green Pastures LawnSite Silver Member
    Posts: 2,457

    No.

    I admire your enthusiasm, but No.

    Taxes is more than 25%, and if I'm not mistaken you pay taxes on your gross BEFORE you take out for paying your helper. PLUS you will be matching his taxes, Social Security, Medicare and Workman's Comp.

    Also you will FOR SURE have more than "a few thousand" in expenses. I pay $150-$300 a month JUST in gasoline and oil. Sharpening blades, $100 a month (yeah, yeah I know I need a Magna Matic.....) Personal property taxes on all the equipment, things get broken, business insurance for me is like $500 a month, all your permits and licenses, the list goes on.

    Go for it though, there is nothing like being the owner of YOUR own company. It is thoroughly gratifying, and I love what I do.

    Just EXPECT not to make much if anything at all for the first couple to 5 years. Pour alot of it back into the business, learn as much as you can, GET and STAY on top of the tax situation. Sooner or later you will be able to sit back and say look at this, I did this (with God's grace) and I'm proud of it.
     
  7. greenman

    greenman LawnSite Addict
    Posts: 1,405

    Those figures are close to my projected 2nd year full time.
     
  8. Love Thy Neighbor

    Love Thy Neighbor LawnSite Member
    Posts: 33

    Man thats a lot going out.
    Is it really worth all of the work when you cant keep a decent salary. Lets say if I did do $72,000 worth of work. Does that mean that out of all of that work I may only get $30,000- $35,000 to keep.

    I could not afford to due that with the kids and wife.
    Then add in health insurance for my family and other expences.
    Seems like I'll just get a couple of shades darker and wouldn't have the money I want to show for it.

    Now I figured if I worked some of the accounts and my helper worked that majority I can make my money off of him.

    I now supervise 43 employees at my job and I'm good at it.
    I could do without some of the stress but I need the money.
    I have excellent customer service and would go all out for a client.
    But man If I had to do all of the labor and still got peanuts , I dont know.

    But guess what. I sure could use an extra 25,000 - 30,000 a year.
    That would diffinently help out my family. So I'm going for it ALL.
     
  9. Flex-Deck

    Flex-Deck LawnSite Silver Member
    Posts: 2,846

    1. 20 jobs at $120 per trip = $2400 per week
    2. $2400 x 30 trips = $72,000 for the year gross.
    3. My part-time helper at $10pr hr at 6hrs for 5 days= $300prwk
    4. $300 x 30 wks = $9,000 pr yr for helper
    5. $72,000- $9,000 = $63,000 gross for year
    6. $63,000- 25% for taxes = $49,250 for me net.
    7. Subtract a couple thousand for expenses.

    Looking at number 1. I would assume 40 hrs of mowing per week at $60/hr. This would be conservative perhaps?
    If you are using a commercial mower in the $8000 range, you had better figure $8/hr for depreciation, and maintainance and fuel. $8 x 40hrs/wk x 30 wks = $9600/ yr for each mower. I think this is a conservative number.

    Number 3 does not include workmans comp, social security, liability. In our area that would add up to about $1400 total

    Truck and Trailer depreciation, and expenses at about 30 cents per mile - how far are you driving to these places?

    Just my thought on the subject - It is easy for me to overlook a lot of those hidden expenses, but at the end of the year the tax man usually shows me my net is different from what I thought.

    Thanks, Brad
     
  10. Brickman

    Brickman LawnSite Bronze Member
    Posts: 1,249


    Very likely. My best year I grossed $80,000 and paid tax on $30,000. This was my best year.
     

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