Your first year in business

Discussion in 'Business Operations' started by michindi, Jul 29, 2004.

  1. michindi

    michindi LawnSite Member
    Posts: 98

    Did you lose money in your first year in business? If so did you make it back in the following year? I bought my business back in December and I am now just starting to lose money. Should i be worried?
     
  2. NNJLandman

    NNJLandman LawnSite Bronze Member
    Posts: 1,306

    We'll my first year, I probably lost a few dollars here and there, investing in equipment so that I would have it, but not that much money, eventually you should make it all back, if you keep records of your purchases and income you should be abel to figure out where your at, this can help you with pricing jobs, all around you wanna give customers the best possible price, but your also trying to make a living so you don't wanna short yourself. I'm p/t and fortunantely not losing any money....jus makin lots of it.

    Jeff
     
  3. michindi

    michindi LawnSite Member
    Posts: 98

    I have more accounts but less money comming in.
     
  4. BCSteel

    BCSteel LawnSite Senior Member
    Posts: 876

    Then you have a problem.
     
  5. LwnmwrMan22

    LwnmwrMan22 LawnSite Platinum Member
    Posts: 4,372

    I "lost" money my first 10 years in business.
     
  6. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Posts: 4,041

    Hi michindi,

    Do you have any thoughts on why this is happening? Are your accounts spread too far apart? Are you not charging enough?

    Here is something else to consider, taken from here.

    "The Law of diminishing returns


    in economics, law stating that if one factor of production is increased while the others remain constant, the overall returns will relatively decrease after a certain point. Thus, for example, if more and more laborers are added to harvest a wheat field, at some point each additional laborer will add relatively less output than his predecessor did, simply because he has less and less of the fixed amount of land to work with. The principle, first thought to apply only to agriculture, was later accepted as an economic law underlying all productive enterprise. The point at which the law begins to operate is difficult to ascertain, as it varies with improved production technique and other factors. Anticipated by Anne Robert Jacques Turgot and implied by Thomas Malthus in his Essay on the Principle of Population (1798), the law first came under examination during the discussions in England on free trade and the corn laws. It is also called the law of decreasing returns and the law of variable proportions. 1
    See W. J. Spillman and E. Lang, The Law of Diminishing Returns (1924)."
     
  7. jajwrigh

    jajwrigh LawnSite Bronze Member
    Male, from Martinsville, IN
    Posts: 1,405

    This is the reason you guys need to stick with turf applications only! Welcome to the land of "good" ROI!
     
  8. michindi

    michindi LawnSite Member
    Posts: 98

    All my highly priced accounts are leaving and its hard to replace them.
     

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