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You aren't kidding about that. Iv been in the trade 25 years this is my 11th in business and we are coming the the conclusion that we can not make any real money with employees. My data shows I make a small profit sometimes break even most time and loose my shirt some times with employees. The more work the worse it gets.
Your either paying them too much, or again not charging enough resulting in a negative cash flow situation, so it looks like your making money but really your not. Another thing I've found is you really gotta watch your efficiency like someone said above, employees will drain you dry if you don't.
 
Well I'f I understand this right you plan on not having employes. So let me ask you this. What is your retirement plan. What will you be doing when your 50. You can only make so much by yourself. I couldn't see how that would be enough to support you the rest of your life.

That's why I think the comment you made if I understand correctly is the dumbest most incorrect comment I've read on this sight. Yes I made $50000.00 -$60,000.00 when I was solo with part time help. I now have a bunch of trucks and bunch of employees. Yes it's a night mare a lot of the time and it takes a lot of money to operate but I make a Hell of a lot more money. I have to be more careful with my money but I do make more.
If you broke even because you have employes only a few things could be the case. You can't run a business
You don't or didn't need employes.
Everyone business model and needs are different. Some of us Solo fellers have other interests also. Im approaching 50 and this is the perfect business for me.

As far as the OP, I can say I know a lot of lawn fellers that have a employee and don't have the income to move out of their parents house. If I were young Id bust my azz 15 hours per day and get my persona and business finances in real good shape before Id even consider hiring anyone.
 
Everyone business model and needs are different. Some of us Solo fellers have other interests also. Im approaching 50 and this is the perfect business for me.

As far as the OP, I can say I know a lot of lawn fellers that have a employee and don't have the income to move out of their parents house. If I were young Id bust my azz 15 hours per day and get my personal and business finances in real good shape before Id even consider hiring anyone.
bingo! that's why I bought the new mower last year, new landscape trailer this year, new back pack blowers, and a new dump trailer and some other stuff while I'm living at home and my business related stuff is my only expenses! no employees and lovin it. but yes to answer the OP's question I did have cash flow issues last year and I was making a lot more money or it looked like I was anyways. but I was paying my part time employees too much money. So really I wasn't making much more money then I am this year and I'm doing a little less driving. definitely less work, and much easier on me to not have to deal with anyone else except my customers.
 
Well I'f I understand this right you plan on not having employes. So let me ask you this. What is your retirement plan. What will you be doing when your 50. You can only make so much by yourself. I couldn't see how that would be enough to support you the rest of your life.

That's why I think the comment you made if I understand correctly is the dumbest most incorrect comment I've read on this sight. Yes I made $50000.00 -$60,000.00 when I was solo with part time help. I now have a bunch of trucks and bunch of employees. Yes it's a night mare a lot of the time and it takes a lot of money to operate but I make a Hell of a lot more money. I have to be more careful with my money but I do make more.
If you broke even because you have employes only a few things could be the case. You can't run a business
You don't or didn't need employes.
Why I appreciate input you an I are not on the same level and you do not know what its like to have a 26-30 week mowing season. Yet I bring in close to a quarter million every year. But lately I realized I could bring that in each year with just my partner and no employees. By shedding the extra work and cherry picking 160 accounts out of our nearly 200. Up here employees cost significantly more a 3 year vet expects 15 an hour. I have 10 year vets so take an average of 17 an hour then times it by 1.5 for ot then add on 20% for wc unemployment ssi and a few others and you see ot quickly exceeds 30 an hour real cost. The market will bare 60 an hour we charge it and it's not enough. Look I understand the faith in the employees make money model is very strong in some yet we now have 9,000,000 fewer jobs than when Obama was sworn in they just do not exist there gone. I may be late in realizing the futility of my employee pursuit but my eyes are open this year.

As for doing this when I am 50 well I am 43 now and work rings around the 18-30 year olds that make up my employee base. I can and will work another 20 years plus in the field and if you feel you aren't capable of that then thats your limitation but I do not happen to share it.
 
As for doing this when I am 50 well I am 43 now and work rings around the 18-30 year olds that make up my employee base. I can and will work another 20 years plus in the field and if you feel you aren't capable of that then thats your limitation but I do not happen to share it.
I am 59 now. Come next May 60. I remember how my body was when I was 43. It is the rare person that can do what they did at 43and not ache when 59.

If you are not making enough money your employees are not working efficient enough, fast enough, paying them too much, not charging your customers enough, any combination or all of them.

When you get older you will find it hard to keep the same pace. By the time you hit 62 you will need to have your retirement needs met. Whether to cut back hours, have a helper.

Or send out a two man crew and you just handle the management and non field work so they are more productive.

Or make enough money before you hit 62.
 
I am 59 now. Come next May 60. I remember how my body was when I was 43. It is the rare person that can do what they did at 43and not ache when 59.

If you are not making enough money your employees are not working efficient enough, fast enough, paying them too much, not charging your customers enough, any combination or all of them.

When you get older you will find it hard to keep the same pace. By the time you hit 62 you will need to have your retirement needs met. Whether to cut back hours, have a helper.

Or send out a two man crew and you just handle the management and non field work so they are more productive.

Or make enough money before you hit 62.
Everyone is different, one of my competors is 60, he can work circles around anyone that I know. My goal is too slow down a little in a couple of years, the only way Ill hire someone is if Im unable to move around.
 
Payroll issues are serious as that is likely where most of your cash flow is going.

Some of the bigger companies have systems in place where the newest workers get sent home, have to call in to see if needed, etc when you aren't dealing with steady work and have problems like mother nature that no only effect your ability to work, but your sales as well.

Sometimes you have to make the call to scale back on employees while other times you have every hand on deck working overtime.

This is a seriously complicated issue where the number of variables at play is huge.
 
I do full service lawn and landscaping services. I have a crew of Myself and3 fulltimers around $300,000 a year in sales and working with a %17 profit margin, everyone needs to know there margins in order to answer this important question.

Another thing I ask myself is I think my profit margin would be higher if I worked solo honestly. But We do alot of landscaping and I need help for the heavy labor etc. This buisness seems to have little profits on each dollar your guys make you. Just got to operate lein in debt and work efficient. Guys slacking get rid of them. I talk to my wife alot about maybe going back to solo with a part time guy. I could make a decent living on my mowing accounts. I guess I enjoy the rush right now, but the older I get, only 31 right now but still some day might want to slow down with the employees. Good luck everyone!:waving:
 
Payroll issues are serious as that is likely where most of your cash flow is going.

Some of the bigger companies have systems in place where the newest workers get sent home, have to call in to see if needed, etc when you aren't dealing with steady work and have problems like mother nature that no only effect your ability to work, but your sales as well.

Sometimes you have to make the call to scale back on employees while other times you have every hand on deck working overtime.

This is a seriously complicated issue where the number of variables at play is huge.
Another great piece of advice from Will p.c. Everyday in the landscape field is different. You might have 2 guys working a day and hit $700-900 mowing and the next day things don't go right and they make $300 barely covering payroll let alone your truck and expense payments. These factors happen alot and when you have more guys working the more risk for failure. Sad fact I can produce about as much mowing by myself most days as my crew of 2 guys can. But sometimes we just need help to get the work done.
 
Okay...well I think it does sir. It's a leading question...as in leading to what type of the accounts he has/what size?

Thank you though...
How about you give us a good, detailed explanation of why size and what type of accounts has anything to do with cash flow?
 
I said net income with no employee figured in.
Net income has nothing to do with cash flow. A medium or large company can gross a million and net $100K and still have cash flow issues.

TruGreen, back in the day, had cash flow issues every spring. They'd dip into their line of credit for $1 BILLION every year. But they were profitable at the end of the year.

Payroll can be a challenge for me at times. It allways works out though week to week. We are allways busy but we do small jobs and we have to move around alot to be able to meet payroll. Overall you have to know how much you need to make a day with your helper to cover your expense and payroll. Set your daily goal and as long as you cover that goal everyday you should be able to pay him just fine every week. Other thing's can make it a challenge sometimes, slow paying customers and equiptment that breaks etc and mess things up sometimes, but if your going to have a employee it's wise to build up a safty net account to have backup money for slow times or bad weeks.
Just amagine larger crews of 10 or more guys totally different than just 1 or 2 guys think about how much money they need to make daily just to make it.:waving:
You have some valid points about efficiency, but again, how does that relate to cash flow?

The OP needs to answer seabee's questions and determine if he really has enough work for 2 people. Until then, all these other questions, speculations, guesses, etc are confusing the issue.

This is basic business, and if you don't understand cash flow vs net profits vs gross, just subscribe to the thread and don't attempt to give any "advice".
 
The OP said "cash flow issues" , not profitability issues

Granted he might not know the difference between the two.

If he truly has a cash flow issue. He may or may not be profitable. But his current problem is caused by him having to pay out his labor and bills before he is paid. Solutions are

1. Get paid sooner from multiple methods
2. Save money in an account to help with float time
3. Reduce amount you pay out
4. Change the terms of when your payouts are due

If he has a profitability issue and is having cash flow problems because of not being profitable

1. Don't charge enough
2. Charge enough per hour but are in efficient
3. Bid jobs too low
4. Have high direct costs
5. Have too high over head
 
I started this business a year ago as a part time business while attending college. This summer I have gone full time with and now have one employee who has been helping me since mid-June. I am finding that meeting payroll puts a financial strain on the budget. I depend on this income to support my family and I only bill my customers at the end of the month. I pay him $10/hr, which is the standard rate in my area.

My question is how do you guys deal with payroll and cash flow issues? Any advice in these areas would be appreciated. Thanks.
As seabee24 says, are you really having cash flow problems or is it that you just don't generate enough income for two people?

This summer I have gone full time with and now have one employee who has been helping me since mid-June. I am finding that meeting payroll puts a financial strain on the budget.
What I am getting from this is that you hired an employee "to help you" and that's not the way it works. If you hire someone to help you do your work, now you have to split your income with him. You use an employee to generate MORE income by enabling your business to handle more and larger accounts. An employee that simply helps you get things done quicker or easier isn't doing a thing except cost you money.
 
Because what I started with was a leading question...time to provide valuable/helpful information without all the critiques. Don't take it personal bud. Lets help one another out.

Have a great evening Mark.
So was mine, but you didn't follow. Let me help.

Tell me how these scenarios are different and help the OP with cash flow.

The OP has 5 customers, large commercial and it takes 1 day each to service them. He grosses $100,000 per month. Billed at the end of every month.

Or:

The customer has 500 customers, small residential and he services 100 per day and grosses $100,000 per month. Billed at the end of every month.

Now, in detail, please explain why size and type of accounts has anything to do with cash flow.
 
So was mine, but you didn't follow. Let me help.

Tell me how these scenarios are different and help the OP with cash flow.

The OP has 5 customers, large commercial and it takes 1 day each to service them. He grosses $100,000 per month. Billed at the end of every month.

Or:

The customer has 500 customers, small residential and he services 100 per day and grosses $100,000 per month. Billed at the end of every month.

Now, in detail, please explain why size and type of accounts has anything to do with cash flow.
Trying to get 500 customers to pay on time, every time is a lot more difficult than 5 customers; that speaks a lot to cash flow.

I have more answers if you want Mark.
 
Wasting monitor ink.

I'm done until something intelligent comes along.
 
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