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Lets talk margins.

Discussion in 'Business Operations' started by 205mx, Mar 14, 2013.

  1. grassmasterswilson

    grassmasterswilson LawnSite Platinum Member
    from nc
    Posts: 4,468

    Profit margin is the best value of a company.

    But you still need to look at the overall picture of a business and what they include in the expenses. Are they a huge company or a 75k company? Do they figure the owners take into the expenses? Did they buy equipment?

    In they past I may have taken a draw for an Ira contribution, added to a savings account, or used business funds to help pay personal taxes.
     
  2. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    This is a discussion about our margins. We know what they are and what they aren and the factors that can skew them.
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  3. THORNTON SERVICES LLC

    THORNTON SERVICES LLC LawnSite Senior Member
    Posts: 405

    hey 205mx kinda quick to be nocking people for there opinions and provided info areant you? every one contributes what they feel is relavent , no need to so quick to try to antagonize people and be a prick on the the computer , maybe this is why you are getting suck a grand response to your thread ?
     
  4. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    Just polluting the thread is all.
    Sorry not trying to come off as short or rude.

    It's just that they didn't post anything with any answers. It's As if they don't know their own numbers so they just post definitions. My mistake though.
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  5. wbw

    wbw LawnSite Fanatic
    Posts: 5,404

    We just aren't buying your 41% is all. How much do you pay yourself? Or are you counting your pay as profit margin?
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  6. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    Yes. As you should if you're an LLC taxed As a Sole proprietor.
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  7. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    I've been here a while. And I think a lot of guys did that good there first year or two if they already had equipment and no employees. And 40 lawns driving under 50 miles a day. Average lawn over $60. My brother runs a sand supply company and his margins after taking a salary are still 22%.

    Profit is profit when you are taxed as a sole prop. Now if your taxed as a Corporation, then things are going to be different.

    People like to make that argument, and that's all fine and dandy. But there's no "buying" it.

    As a sole proprietor, retained earnings are NOT your only profits. Your pay is also Profit.
    As a corporation, the money after your pay is profit.

    Not trying to fight wit h you guys. I've been a fairly regular poster on here. I was simply asking. But for some reason when guys ask "how much do you make" nobody gets upset.

    Profit margins are different for different companies and businesses of all size.

    My uncles furniture restoration business operates with huge margins. Buys things at sales for $40. Fixes for 15, sells for 300. Fuel to get to sales, and a few other things. He doesn't have the equipment we have.

    A guy with a push mower only will run higher margins than a guy with zeros.
    We all get that. I was asking to see if my projections for adding mowers and staff were close. I was estimating my trends for 2014 when I add staff. ...not everyone is attacking guys
    Just trying to discuss with fellow business owners.

    I just really didn't want to get in to a discussion about what margins are. But more of, ways to shave margins, if your happy, if you are running as lean as you can, etc...
    ;-)
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  8. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    Agree, some years are much more expensive. If there are major equipment costs, you can calculate the margins with it, without it, and then the projected savings from the new equipments efficiency.

    Well put in that regard grass master
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  9. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    This seems to line up fairly with what I am projecting. What are some things you do to keep it all in line? Do you use a program like quick books that help with that?
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  10. 205mx

    205mx LawnSite Silver Member
    Posts: 2,339

    That's interesting. It would be interesting to know exactly how thin the maintenance side is margin-wise. I think it's a good thing to dump some more money in to your equipment. Will help for future years.
    Sounds like you run a hell of an organization. Congrats
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