Return on investment

Discussion in 'Lawn Mowing' started by fastlane, Dec 2, 2011.

  1. fastlane

    fastlane LawnSite Senior Member
    Posts: 347

    I'm talking mowing not landscape. I had lunch with my accountant today. His son has a lawn co. He does the books for about 10 lawn companys. He said the smaller the investment the higher percent return on your investment. Example- 1 21'' push mower, blower, edger, subcompact pick up could gross $75 per hr.(low overhead) verses - zero turn blower,edger, full size truck at $75 per hr (high overhead). The guys that have the big things also tend to have bed edger, aerater etc. that are only used a few weeks a year. So every dollar you spend nets you a lower percent return. I know it takes money to make money. What do you think?
     
  2. gebby

    gebby LawnSite Senior Member
    Posts: 705

    I think that in a 10 hour day I would have a hard time grossing 750.00 with my 21 inch push mower. That I can do with my over priced zero turn and still have time and energy at the end of the day to take care of mama and the kids. I've done it both ways. You can not cut that much grass in a 10 hour day with a push mower. If you are lucky you might gross 150.00. That's what I think.
     
  3. Green Feet Lawn

    Green Feet Lawn LawnSite Member
    Posts: 226

    Equipment = productivity. You just need to forcast the cost of the equipment over a period of time. For the occasional use machines, renting works for us. That way you can factor it into the job cost.
     
  4. tony b

    tony b LawnSite Member
    Posts: 126

    Depends on the accounts. I know a guy who built his business on the side while working for a high end nursery. He knew who had the money to pay, who was easy going etc. With only 31 accounts which involved mowing shrub trim mulching fertilize whatever they wanted. Alone and equipped with a 21 he cleared 6 figures a year.
     
  5. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,260

    Here's and investment for you 2003 lazer 27hp 60 inch deck trac vac system cost me 10k brand new and iv put close to another 20k in repairs and up keep in to it. My return on my 4750 hours thus far is over 500,000 dollars how many 21 inch mowers can say that.
     
  6. tony b

    tony b LawnSite Member
    Posts: 126

    I would say your not very smart. If you make that kind of money on just that mower and nothing else you should lease equipment and get a new mower every 2 years. This way you have some good tax deductions. Your way and your paying out the azz in taxes.
     
  7. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,260

    Wow give someone enough line they always hang themselves. That's one of 4 mowers I run so that number is significantly larger. An as far as tax deductions go I own 60% of a S corp I haven't paid income taxes in 9 years I have 99,000 in personal roll over deductions as of last year. And that's before I bought a brand new 60k ram 4500 crew cab this spring and shes getting a twin sister this April. Personally I try not to guess others tax structures since one its none of my business and two more often then not you haven't got a clue what others are doing.
     
  8. tony b

    tony b LawnSite Member
    Posts: 126


    The one thing that you do make obvious is that you like to talk about yourself. I have this, I made this much blah blah blah. Its jackazzes like you runing there mouth about what they have that get too many new companys starting up. I don't know what you have and don't care. I didn't hang myself and if you mowed as much as you think you do you do you wouldn't own an 03 anything......jackazz lol
     
  9. 4 seasons lawn&land

    4 seasons lawn&land LawnSite Gold Member
    from NY
    Posts: 3,587



    So I get that this is a joke but..... whats the point.
     
  10. drenchedlawn

    drenchedlawn LawnSite Member
    Posts: 145

    Wrong wrong wrong to he who says stay small. There is not enough profit margin in small. You will max out at 40k or 60k net. You must plan and forecast for growth! You must cross over the uncomfortable stage of growing from solo if you want to make more than 60k. You must have a growth strategy and hit numbers of projections. You must have projections and threshholds of profit margin. The only way you will achieve growth is through quality employees and equipment. As you add crews you will start to distance yourself from failure based on a few bad months. Get the snowball rolling but don't over extend. Grow fast but with margin attached to every job. Let me back up....if your goal is simply to net 60k you can achieve that as a small operation but I suspect you will burnout in under 5 years unless you enjoy minimal stress and hard labor which is each is cool also if thats what you want. There will be a sliding scale of profitability at first where you will maximize but top out, then you will suffer until you re-establish your sweet spot. If you have drive you will succeed in either arena. But going larger will prove to be a better investment for longevity.
     

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