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sent out crew for first time - compare percentages

Discussion in 'Lawn Mowing' started by wrestlingcoach, Aug 25, 2004.

  1. wrestlingcoach

    wrestlingcoach LawnSite Senior Member
    Posts: 251

    Does this sound right?

    Sent out crew they grossed $272 mowed small lawns. SMALL DAY
    they Had 9.5 man hours in the process @ $10 per hour
    then plus $1.75 more per man hr for work comp & matching funds
    also sent $25 in gas. They had to drive 18 miles one way for one job , I know there is some good windshield time in there.




    272.00
    -95.00 = 35%
    -17.50 = 6.4% ( all together employee expense = 41.4%)
    -25.00 = 9.2 %

    = $134.50 in profit = 49% profit

    does these percentages sound right?


    How does other companies compare in percentages?


    I know that if I paid like every one else 7-8.50 per hour that would help but pay good - expect good work and they work hard!!!
     
  2. NCL

    NCL LawnSite Member
    from NJ
    Posts: 132

    How many guys did you send out?
     
  3. wrestlingcoach

    wrestlingcoach LawnSite Senior Member
    Posts: 251

    2

    one went out early and mowed lawns by himself for a couple of hours while the other guy met up with him after he completed his morning school bus route.

    shea 7 hrs
    dan 2.5 hrs

    probably not the most effiecient but it has to work
    since the bus route gives health ins.
     
  4. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    Your numbers aren't taking into account your other expenses, like taxes, payments for trucks/equipment, etc. You'll need to factor all that in as well for a true profit figure.

    As for me, I'm solo. But I'd be interested in hearing what others say. BTW, what's the $1.75 matching funds thing?
     
  5. Trevors Lawn Care

    Trevors Lawn Care LawnSite Bronze Member
    Posts: 1,180

    thats sounds very good to me..

    It isnt very accurate though....Now figure in what the insurance percentage is, fuel, mower depreciation, and such....Although those should only be a very small percentage it is still a percentage that needs to be looked at....I guess it is more accurate than i first thought, but it the actual number would prolly be some less.

    Trevor
     
  6. ddthomas2

    ddthomas2 LawnSite Member
    Posts: 26

    No, you did not make 49% profit! Not even close.

    You forgot all of your other overheads. For instance, equipment depreciation and maintenance(repairs, blades, sharpening, cleaning). Same for truck. What about other insurances like general liabilityand vehicle insurance. Billing, accounting, and collection costs. Advertising. Business and Income taxes. What about your time spent managing. Consumables like trimmer string. Any ice in the cooler?

    I am sure that I forgot several more.

    The message is: Too many people are very unrealistic about what the costs in this business really are. They are the ones who are not here next year. It's pretty easy to make money in spite of your self if you are doing the work. When you start becoming a business by hiring others, it gets a lot tougher.
     
  7. wrestlingcoach

    wrestlingcoach LawnSite Senior Member
    Posts: 251

    this is a rough estimate first
    i know liab ins, grease blades etc, etc

    but

    I am more concerned with the % of employee cost


    the $1.75 is 8.91% of workers comp plus another 7.65% of social security /medicare plus 1% fed umemployment and another 1 or 2 % state unemploy
     
  8. wrestlingcoach

    wrestlingcoach LawnSite Senior Member
    Posts: 251

    Hey I know that the pure bottom line profit isn't close to 49%

    especially after buying $22,000 in eqipment this year

    but Is the employee cost comparable to other lawn companies
    for a general day

    for the last 2-3 years my gas expense for the mowers and company truck combined has been 5-6.5 % for the entire year
    this year it is running at 6.61% of the gross sales
     
  9. HOOLIE

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    Back when I worked for "The Man", his goal was to keep payroll under 35% of gross revenue. Under 30% and he was real happy, but anything over 35% started to hurt him (or so "The Man" claimed)

    But every LCO is going to have different overhead costs, what's bad for one might be OK for another.
     
  10. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,259

    Thats a tad under 30 an hour per man gross its weak there is room for improvement. We typicaly hit 75-90 and hour for a 2 man crew. It will take them some time to get use to being on their own often I find when I send out a crew they lose a ton of time to drive time since they take the long way not knowing all the short cuts.
     

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