"you will never amount to anything"

Discussion in 'Lawn Mowing' started by bobbygedd, Sep 14, 2004.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    an accountant said to me, "you will never amount to anything, doing residentials." i mow the lawn for a friend, who has a relative, who is a cpa. he heard about my argument with my current cpa, and he happened to be at the house when i was there mowing. he asked to talk to me. i spent an hour speaking with him. he wants me to switch to using his services. he told me lots and lots of stuff. he also told me i need to diversify . i need to add a few large commercial accounts, don't be 100% residential. i'm not sure i agree with him. i have a couple "comm" accts, these are very small office buildings, can't really call them comm accts. i bid on one really big comm acct, it was a group, 3 large buildings with different professional offices inside. out of the 5 bids put in, mine was on average more than 33% higher than the rest. based on this, and the fact that the comm properties i see being serviced have a different company there every 2 yrs, i can only conclude that the guys doing comm work are doing it cheap. i like doing small residentials. i believe keeping the overhead down to pennies, and the availability of "higher value" work, or "add ons" , is more proffitable by having many different clients. there is also the advantage of dumping them without a second thought if things should go sour. opinions please on what the accountant said, and what i said. one of his statements also, " a small mowing company cannot break 100 grand in this area (cus it's seasonal) doing only residentials.
     
  2. 65hoss

    65hoss LawnSite Fanatic
    Posts: 6,360

    Some truth in what he said. But if you push it hard enough you can do it in residentials. Its a matter of what you will be happy with and can live with. Comparing to everyone else is a bad idea.
     
  3. dishboy

    dishboy LawnSite Platinum Member
    from zone 6
    Posts: 4,313

    Residential and commercial work is fiercely competitive here and has been for fifteen plus years. I do 95% residential but my best paying job is a small apartment complex.

    I have never pursued commercial work as I am solo and like residentials for the same reasons as you stated. I think some commercial work is OK as long as the account is concerned with QUALITY work and not just the bottom line. If the accounts come to you by reference or by them seeing your work first then I believe you stand much better chance at getting your price. If you are just another name bidding on a property managers list it's probably a waste of time.
     
  4. heybruck34

    heybruck34 LawnSite Senior Member
    Posts: 300

    I'm a CPA full-time myself. I read this site because I like working in my yard and helping friends and family. Why is someone who is trained in accounting telling you how to manage a lawn care business? That just doesn't seem to make sense to me. Kinda like a French Chef telling someone how to farm.

    Good CPA's will give clients advice on managing their resources and money, but I'm not so sure I would put much stock in him telling you to get this type of client or that. Does he have a lot of clients in the lawn care business? Has he ever been in the full-time lawn care business? If the answers are no- I'm not so sure I'd take his advice and change your customer mix.

    Now if he says do this or that to reduce taxes or possibly save overhead- I would listen more.

    I'm not trying to discredit your accountant but this seems to me to be more like hearsay. Like someone telling you that Brand X is the best.
     
  5. geogunn

    geogunn LawnSite Gold Member
    from TN
    Posts: 3,010

    bob--you have detailed your allocation of weekly work/non-work activities here many times and I do not believe you can diversify to the degree the CPA suggests without working more hours in the week.

    as for changing cpa's, I'd only go with the new guy and his plan if he is willing to mow and spread mulch. JMO.

    GEO
     
  6. PaulJ

    PaulJ LawnSite Bronze Member
    Posts: 1,776

    ONe problem that I se for a small operation to do bot residential and large commercial is that The large commercial accounts would probably require large equipment (that wouldn't be useful on all accounts. I like to have a machine that I can use on all my accounts. Say you bid and get a large mowing fert account. Then add a big 2" ZTR and maybe a permagreen or similar spreader. Now you need a bigger trailer to haul everything with and haul debris. Next season the company goes with someone cheaper and your stuck with payments for equipment you can't use on most of your other accounts.
    I like Small commercials and medium residential. same equipment same service.
    My best profit margin is from a couple commercials two blocks apart that only take 15-20min apiece. NOw If I could find a dozen more like that I'd be happier.
     
  7. dkeisala

    dkeisala LawnSite Senior Member
    Posts: 911

    What the hell does an accountant know about the lawn care business? Opinions are like a$$holes, everyone has one.
     
  8. scott in the soo

    scott in the soo LawnSite Member
    Posts: 121

    bobbygedd,,

    i thought you were smarter that bud,, listening to an accountant about a lawncare business..

    get with the program guy...
     
  9. fga

    fga LawnSite Silver Member
    Posts: 2,449

    Bob,
    your set up is similar to mine, small overhead and mainly residentials, off 2 days a week :) i wouldn't go after those big commercial accounts for the fact that, its who does it the cheapest bidding usaully. Stick with what you're doing, adding residential accounts, until you have enough to justify a foreman doing your present job, then you can devote more time to more productive things, like applying sunblock before casting.
     
  10. out4now

    out4now LawnSite Bronze Member
    from AZ
    Posts: 1,796

    If competition is rough then no. Why shell out for equip you'd only use on one property. Speaking business is what the accountant is doing. He wants YOUR business so he is making a sales pitch. Theoretically diverifing makes sense but do this, tell this guy you might consider him if he can do a cost benefit analysis for you after expaling your situation he may back off when he sees you know the business terms he does because for you there will be no benefit really. If he can't show you how it would help then it's just a pitch. That is probably all it is anyway, client building. Got to admit he was smart enough to swoop down at hte right moment.
     

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