January will be the start of my fourth year in the business. It is hard to believe I have come this far without giving up. To date, I have made a profit, before depreciation, of about $35K in a THREE YEAR period. Very ugly. Please realize, that is not $35K per year. That is $35K over three years. As some of you know, who have been following my posts over the years, I had just about decided that there simply was no money in residential lawn mowing in mid to late 2004. When my back went out in August of that year, I was sure I was going out of business. I worked very hard but not very smart my first two years in the business. After my back went out in late 2004, I got some sound advice from some others in my area, and after seeing how things worked without me actually doing the labor, I finally started working smart. I also made an additional $60K cash investment in the business, on top of what I had already invested. I started '05 with 55 customers, peaked at 257 customers in September and now I am down to 244. I am FINALLY able to see the light at the end of the tunnel. As CEO and CFO and COB of my own company, I am not sure why I haven't already done this, but last week I decided to plug some numbers into a spreadsheet and see how things looked for 2006. As usual, I made sure I wasn't throwing "rosy" projections in. These are very conservative numbers. The numbers are pleasantly surprising. If I don't add another customer, despite a hefty advertising budget, and if I get zero production out of my newest crew and if I don't get any non-recurring work (bed clean-ups/shrub trimming), I should be able to gross what I did this year. Only next year, I won't have nearly as many start up costs as I did in '05 and we won't be doing any more design/install jobs with larger costs of goods sold. The only real unkown expense I am dealing with is repairs to trucks and equipment. I am budgeting 5% of gross for repairs. If I stay within that number I am forecasting a profit of $50K for myself in '06. The really cool part about all of this is, if I grow my business by another 190 customers in '06, as I did in '05, I should see something a lot closer to $100K hit the bottom line. Then if I add another crew in '07...well, you get the picture. And the best part of all this is, no one can take that source of income away from me. All of my customers are residential. I don't have to worry about losing a large dollar client because I don't have any. No one can lay me off. No one can fire me. It is still a projection at this point, but it looks like I finally have what I wanted...a source of income that no one can take away from me. I realize it is just talk until it actually happens. But this is the first time I've been able to plug pessimistic numbers into a spreadsheet and still come out with something I can live on. Later, DFW Area Landscaper
That seems like a ton of customers for only profiting that much. You did say that the numbers weren't "rosy" at all. Maybe the profit you stated was if everythign goes wrong, almost the minimum you should make this year. Good to hear the success though. Keep on going.
Well congratulations dfw, thats quite a feat in one year. Im looking to do something similar here up north. Hope you do better than planned in the following years as you expect. Cameron
The Landscaper, The projections are not "rosy" at all. They are pretty much worst case numbers. I am planning for the worst and hoping for the best. Later, DFW Area Landscaper
DFW Congrats on the projections for next year. Can I ask how you have survived on less than 12k a year for the last 3 years? Sounds like your bus. is doing great because of your sacrfice just don't see how you could afford it.
No to piss you off, but for the amount of customers you are going broke if you gross only 35 k in 3 years.how do you pay your help,your bills.
Guys, if you read his old posts, that was his old way of doing business when he wasn't making any money hardly...I think. DFW, nice to see your finally getting out of the hole with it all and the new business structure is working well.
If I am understanding correctly you are projecting 90,000 for yourself after all the overhead and everything is said and done? Sounds O.K. but not great for that many customers.....If you are satisfied with that then go for it but I would raise the prices of your customers(2-5 bucks each, minimum) and continue to charge more as you add customers next year. You are already established and have got a handle on things it seems-so charge higher rates and make as much as possible, the sky is the limit on residential....Nice to hear things are looking up for you, I haven't been around long but I remember reading your posts when things were looking ruff. Good Luck.
Do you know the difference between "profit" and "gross" as in gross sales? The bills are paid out of the gross sales and the profit is what is left over after those expenses.
