desired %profit on commercial vs residential

grassmasterswilson

LawnSite Fanatic
Location
nc
Anyone care to say what percent they are getting? Most of my residential lawns are getting above 50% the best I can figure. The smaller the lawn the larger the % profit. With commercial I am figureing in 15-20% profit. I would rather lose a job to a low baller than get one and not make anything.
 
Here's what I put together.

I calculated all my numbers per working hour here's what I'm getting:
$25 per hour for the guy running the ZTR mower
here's the breakdown per hour -
$12 salary
$4.5 gas
$1 insurance
$3.5 mower replacement (est. 1,500 hr. life, initial cost $5,000)
Maintenance + miscellaneous expenses (truck gas, trailer wear and tear) - $4

$18 per working hour for the helper/weed eater/push mower guy
$12 salary
$3 gas
$1 insurance
$.50 equipment
maintenance/other expenses - $1.5

Puts us at $43 per working hour
company profits/taxes/rainy day fund (pretty much just equipment reinvestment money.) 16% = $7 (rounded up .12 cents)

= $50 2 man working hour


So I try to make 16% on top after all foreseeable expense are payed. Thou... with a truck the price would go up. Forgot to plug that in.
 

orangemower

LawnSite Silver Member
Location
pa
Here's what I put together.

I calculated all my numbers per working hour here's what I'm getting:
$25 per hour for the guy running the ZTR mower
here's the breakdown per hour -
$12 salary
$4.5 gas
$1 insurance
$3.5 mower replacement (est. 1,500 hr. life, initial cost $5,000)
Maintenance + miscellaneous expenses (truck gas, trailer wear and tear) - $4

$18 per working hour for the helper/weed eater/push mower guy
$12 salary
$3 gas
$1 insurance
$.50 equipment
maintenance/other expenses - $1.5

Puts us at $43 per working hour
company profits/taxes/rainy day fund (pretty much just equipment reinvestment money.) 16% = $7 (rounded up .12 cents)

= $50 2 man working hour


So I try to make 16% on top after all foreseeable expense are payed. Thou... with a truck the price would go up. Forgot to plug that in.
Those are practically lowballer prices. $25 an hour for a ztr mower AND operator? Where's your profit? WOW $43 an hour for two guys and all the expense? Holy cow that's cheap. You're driving the prices down with those numbers.
 
Lol... that's what I look at when I'm giving a bid. This is purely my direct expenses. I have truck/trailer payments to factor in. as well as tools/workshop stuff etc.

I'm still developing my system for expenses so this is a work in progress. Where do you see that I need to charge more?

This is more for small commercial and residential.

When ALL expense are factored in than it equals about a dollar a minute for (less for weed eater guy becasue they generally don't cost to much.) but for the ZTR guys (and to cover business related expense) it equals a bit more than a buck per minute. It's this still low balling?
 

djagusch

LawnSite Platinum Member
Location
MN
Here's what I put together.

I calculated all my numbers per working hour here's what I'm getting:
$25 per hour for the guy running the ZTR mower
here's the breakdown per hour -
$12 salaryDoes this include employer side taxes (tax, unemployment, etc?) It seems really low unless you are paying really low.
$4.5 gas Yep
$1 insurance ok
$3.5 mower replacement (est. 1,500 hr. life, initial cost $5,000) what ztr are you buying for 5k that last 1500 hrs? I put in $5 for that 10K mower 2000hrs
Maintenance + miscellaneous expenses (truck gas, trailer wear and tear) - $4if this includes mower maintenance (oil, grease, belts, blades) you might be close for only those items. To add the truck and trailer $4 is really low.

$18 per working hour for the helper/weed eater/push mower guy
$12 salary
$3 gas
$1 insurance
$.50 equipmentI think this is low, this guy has a couple ground of equipment to use at anytime
maintenance/other expenses - $1.5

Puts us at $43 per working hour
company profits/taxes/rainy day fund (pretty much just equipment reinvestment money.) 16% = $7 (rounded up .12 cents)

= $50 2 man working hour


So I try to make 16% on top after all foreseeable expense are payed. Thou... with a truck the price would go up. Forgot to plug that in.
Just trying to help you out. I don't think I can have a employee on a site for less than $45/hr with a worth while profit using handheld equipment. Key words is worth while profit.
 

unkownfl

LawnSite Platinum Member
I think your cost of doing business is way to high. You need to reduce it to be competitive. You spend $7.5 an hour in fuel? $2 dollars an hour on insurance?
 

fastlane

LawnSite Senior Member
Location
east PA.
I think your cost of doing business is way to high. You need to reduce it to be competitive. You spend $7.5 an hour in fuel? $2 dollars an hour on insurance?
Truck, equipment and liability insurance - about $3000 a year. 40hrs a week x 26 cut season = 1040hrs. Insurance is about $3 an hr. I work less than 40 hr so insurance cost more than $3 an hr.
 

djagusch

LawnSite Platinum Member
Location
MN
Your paying a lot for insurance. I pay just over $2-K/year for truck/trailer,equip and GL. Time to find new insurance.
Posted via Mobile Device
Just remember insurance can vary greatly. How many trucks/trailers do you own compared to him? What value of equipment compare? Do you have 50K in sales and he has 300K in sales? Is he counting work comp? What coverages? To many variables to say insurance is low or high, FYI the wife shops mine yearly and pay $350/month.
 

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