Thinking of dropping some acts.

Discussion in 'Lawn Mowing' started by Mow Man, Jul 21, 2012.

  1. knox gsl

    knox gsl LawnSite Platinum Member
    Posts: 4,936

    Would changing the way you pay work? Maybe min wage + incentive pay. I'm not talking about some way to not pay your guys but something to where they're not riding the clock. With the gross you have labor should almost be cut in half. Maybe cut the least productive worker.
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  2. KrayzKajun

    KrayzKajun LawnSite Fanatic
    Posts: 10,742

    You really need to look at your labor. I do pretty close to the amount of accnts yall do, and its me and 1 fulltimer. Plus all the landscaping,tree, irrigation work. I was running two fultimers but dropped one due to realizing, it wasn't good for the books or production.
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  3. dKoester

    dKoester LawnSite Gold Member
    Posts: 3,253

    On your bills cut the fat off. Especially on things you don't need. Thats where you need to take some time to figure out. Food is a major one you need to look at. Just check out your bank account balance sheet. If your eating way too much cut back to something way cheaper.
     
  4. Mow Man

    Mow Man LawnSite Member
    Posts: 106


    Another interesting fact, I seem to do a little better financially during Nov.-March . Mainly because of my Comercial and HOA's being year round. I had the hardest time this year starting in April and every month since as we got ramped up for the busy season. even though my monthly numbers were closer to 15-16 during those months. It has been a struggle every month since. I sometimes wonder if the cost of living has increased more than we think this past year as I did not struggle this much in the previous 3-4 years.
     
  5. morgaj1

    morgaj1 LawnSite Senior Member
    Posts: 318

    I would advise looking very closely at your budget. Do a detailed analysis of your income and expenses and see where your money is going. Only then can you determine profit margins. Following your discussion, it seems you have a good handle on your gross income, but not as good a handle on your expenses. Until you know these figures backwards and forwards, it is pure speculation.
     
  6. DEPENDABLE LANDSCAPING

    DEPENDABLE LANDSCAPING LawnSite Bronze Member
    Posts: 1,343

    Really seems like the labor is what is hurting you badly. Start with the elephants then control the little costs. We bill out significantly morecthan you on a monthly basis, it is me and 2 full timers. Keep at it hard and you will be o.k. monitor and control all costs from top down.
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  7. trooper8870

    trooper8870 LawnSite Member
    Posts: 241

    Your problem seems to be the same as a local LCO. He has had to file bankruptcy because he can't make ends meet. He has between 100 and 150 accounts and 5 guys working for him. He will tell you, now, that he is doin work way to cheap and he is afraid to go up on his prices for fear of loosing his accounts. But, are you in business to provide jobs for someone else or to make a living for yourself? Really evaluate your expenses. If you are having trouble making ends meet now, then its only going to get harder. You may need to scale back to you and one more and service your highest profit accounts. It is not worth loosing your business or lively hood just to hold a high number of accounts.
     
  8. Duekster

    Duekster LawnSite Fanatic
    from DFW, TX
    Posts: 7,961

    Sounds like you need to do some hard job costing to determine where your leaking is happening. Is it a production issue, or a bid issue or a little of both depending on the account.

    It does sound like a revenue issue for the amount of labor you have.

    It is hard to generate a great deal of profit on a typical residential account while keeping everything above board. However, you should cover overhead, wages and make a small profit. This is important to helping with cash flow, while you want a good profit, sometimes covering OH is good enough to feed the beast so you can land those other jobs outside of mowing.

    Do you have a spread sheet looking at your overhead cost, broken down into an hourly recover rate?

    Do you use Quickbooks or some other accounting software?

    If you lose 15 mins a day with a 4 man crew how much does that cost you? In terms of money out of pocket and money not earned?
     
  9. Penncare

    Penncare LawnSite Member
    Posts: 179

    If this is correct that the actual cost of the crew is $1000 per week and you gross $3000 the income to the company/you is $2000 per week. ergo you are earning $104,000.00 per year taxable income after costs. If this is not accurate then you have not accurately assessed your per week costs. Maybe you have a building you operate out of and that is an expense that we don't know of, or maybe taxes of $30k and you keep 74k seems bad to you. If the numbers you state above are accurate, then add another crew and make double next year. I am not trying to be a smart***, a lot of us don't really know how much it costs to operate.
     
  10. 205mx

    205mx LawnSite Silver Member
    Posts: 2,346

    not sure what the problem here is outside of the debt. if you have too many bills, then thats the problem. Imagine having no bills except insurance, gas, and payroll. If getting rid of accounts is the answer there is something seriously wrong.

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