operating expenses

Discussion in 'Business Operations' started by Just Cut, Nov 22, 2002.

  1. Just Cut

    Just Cut LawnSite Member
    Posts: 158

    this is my first year full time and have heard people talking off knowing your expenses per hour of operation, I have totaled up all expenses listed on schedule C incured for this year, I have divided the dollar amount into the windsheild and actual field time and have come up with 15.21 per hour in operating expenses, At this time I average 50.00 per hour which includes travel time, My Question is what is an acceptable profit % for the business and take home earnings per hour. thanks in advance:)
     
  2. Anything over $25 per hour is gravey.
     
  3. Darryl G

    Darryl G LawnSite Fanatic
    Posts: 8,128

    Just Cut - This is my first year full time too and I have no idea yet what my operating expenses are per hour. I'll know this winter when I have time to crunch all the numbers.

    If you're making $50 per hour including travel time, I think you're doing great. I personally would find that to be a more than acceptable profit.
     
  4. B. Phagan

    B. Phagan LawnSite Member
    Posts: 95

    I applaud your efforts on trying to determine your CPMH....sounds like you might be pretty close.......rather than go off Schedule C, I'd create a profit and loss statement and separate expenses into two categories, direct job costs and overhead costs. Then do the math and make sure every expense item is accounted for.

    There is an accounting book I recommend and have as well called "Accounting for Dummies", about $20 bucks. Goes into setting up the P&L as well as Balance sheet and finance in general............and the bottom line to your question about how much is a good % of profit? Whatever you want to make, you CAN make in the profession. I figure that's why they call it the "green" industry.

    Look at your family and business expenses and determine your breakeven point, then above that is pre-tax profit.......go from there.
     

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