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Business Update - Loss Leader

Discussion in 'Lawn Mowing' started by Turfer, Aug 29, 2000.

  1. parkwest

    parkwest LawnSite Senior Member
    Messages: 678

    If you think there is a high profit margin in just running a lawn mowing service you'll be amazed to see your margins in offering a full service landscape business.

    I see guys running all over town going from one job to another just mowing when if they just took the time to look around they would see more opportunities to make money where they were just at. If nothing else it would be easier on your truck.

    Would it not be better to provide your customer with a "1 stop shopping" type of service?
  2. Stinger

    Stinger LawnSite Senior Member
    Messages: 252

    Parkwest: I'm probally going to get slammed for this but I agree with you. We offer a full service landscape business and make twice as much as those that only mow. I can cut all day and make $500. Or do special svcs. & landscape work to the tune of $1,000. Now dont get me wrong, I have many a friend that just only want to cut gr*** and theres nothing wrong with that as long as your happy. That is why I started doing landscape and lawns because it was fun to me, I really enjoy it. Now theres some days that really suck, but I dont get mad and look at someone making more money than me and become aggrevated. I chose what I do and if I don't like it I'll change it! I totally agree with the one stop service where the customer deals with one person and writes only one check. But I'd leave the new home construction to a builder, that's not in the landscape field. As for tslawn, you're awful defensive about the kid down the street. Is he a friend of yours? Did he steal some accounts or what? We all have been the kid down the street at some point in time. I still know a few of them (all grown up now) and they work in all walks of life making different incomes. There is money in cutting gr***, working at a bank, fixing cars etc. It just depends on how much you wish to make.
  3. bondlawn

    bondlawn LawnSite Member
    Messages: 47

    Thanks to both Kent Lawns and Parkwest. When I read your comments it was like someone just turned on the light bulb over my head.

    There is a landscaping contractor in town I've gotten to know who treats maintenance in a very casual way. All of a sudden, now I realize he just uses his maintenance to get the landscaping jobs.

    Thinking back to the two or three small landscaping things that I have done in the past couple of years, I realize that I made a whole lot more money per hour on those jobs than I have on any lawn I've ever cut.

    Thanks to both of you for your insight.
  4. osc

    osc LawnSite Senior Member
    Messages: 502

    I don't personally like the idea of loss anything. My customers pay good money for maintenance and bigger money for landscaping but I don't lose money on any job or I wouldn't do it.
    I understand the foot in the door concept but to me $500 per day profit is good money and it would be if I had millions. I mean 500 a day is 500 a day.
    We do full-service lawn and landscape. Some landscape jobs we do make me wonder after I spend a couple of hours with the customer, take pictures, make a design, take them back to the customer, make changes etc., then after something is installed the customer wants me to change something so I have a call-back for free. And the change they want involves equipment and so on. You know, I've made as much as $1,000 in one day mowing gr*** and that's profit. Then still have a full week left like we didn't even make a dent.
    No changes, call-backs problems etc..

    Bottom line...profit is where you find it.
  5. Chuck Sinclair

    Chuck Sinclair LawnSite Senior Member
    Messages: 336

    Ok this may be a stupid question but i keep reading about striping your lawns. How do you do this?

    Willow Brooke Landscape
  6. Stinger

    Stinger LawnSite Senior Member
    Messages: 252

    Sinclac: Just click on Erics site lots of eye candy there!
  7. Eric ELM

    Eric ELM Husband, Father, Friend, Angel
    Messages: 4,830

    Striping a lawn is when you have the light dark pattern on a lawn when you are cutting the turf. If you aren't sure, click on my signiture below to see stripes.
  8. Chuck Sinclair

    Chuck Sinclair LawnSite Senior Member
    Messages: 336

    Thank You for the info. I learned one thing i'm not going to be doing that with my 21" Honda's all my lawns are small compared to Erics. I think i could put all of my accounts in one of Erics!

    Chuck Sinclair
  9. eslawns

    eslawns LawnSite Senior Member
    Messages: 712

    Why is it that every install outfit is convinced that just because maintenance guys don't want to muscle around trees and boulders every day, that we don't make a profit? What a crock. I'm not getting rich, but I make better money than I would as an engineer for the first ten years, and better than most of my clients. And I don't care what you gross, none of you spends the better part of your day on the business end of a shovel. If you are then YOU don't make any money. Here's something else to factor in: Every time you get a new install job, you spend time before the shovels come off the truck to estimate your costs and sell the job to your client. Mowing is residual. That means you keep doing it, but only sell it once. My brother in law does tree work and makes three times the money I do in a day. When he works. And when he works, he busts his hump. It's hard, hot work moving tree trunks. And, yes, it's hard to find help to do that also. As far as offering services, what does the average installer do? Most work for builders, do lousy work, cut profit to the bone (builders ALWAYS go the cheapest way) and when their plantings die, it's a real landscaper that gets a call. I don't know about the rest of you guys, but I don't do major installs for the same reason I work alone. Because I don't want the hassle. Just because you can't sell a job without buying someone's business, don't assume noone can. And the guy who cut the $30 yard for $22... Why would you do that? do whatever you do and cut the thing for $30 also. No wonder you aren't making money, you can't do arithmetic.
  10. parkwest

    parkwest LawnSite Senior Member
    Messages: 678

    Basically, what you are trying to tell me is if there is $100.00 laying on the ground you would not pick it up because you only do grass.

    What I think a good business man should do is look for all the oppurtunities to increase the bottom line for your business.

    Unless you are a sole operator and wish to remain so, if you are in trenches with your workers you will need to make the transition from technician to management someday to see your business really take off. You need to ask yourself, are you running your business or is the business running you? Can you take off for a few weeks and come back and everything is running just as smoothly as you left it. These are things you can strive for as you grow your business.

    As for "builders ALWAYS go the cheapest way," We build custom homes and the first step is to assemble a team of subs that do what they agreed to do, not the cheapest. Like everything else in life you generally get what you pay for.

    As for our ability to do arithmetic you evidently don't understand what a loss leader is or realize what we charge to do landscape work. $8 x 32 weeks = $256 which is excellent considering we didn't have to spend any time or money to locate this customer for all the extra work.

    For anyone interesting a good book for any business owner to read is "The E-Myth" I'm sorry but I don't recall the authors name.

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