How do you figure the cost of a job?

Discussion in 'Starting a Lawn Care Business' started by Stampede, May 18, 2004.

  1. Stampede

    Stampede LawnSite Member
    from Ohio
    Messages: 19

    Thanks Stampede.
  2. legendrider

    legendrider LawnSite Member
    Messages: 50

    Start by measurint the job with a wheel. you need to decide what you want your labor to cost.

    PMLAWN LawnSite Gold Member
    Messages: 3,534

    If you are new at this it can be a little hard to start.
    Look at your yard and measure it. Cut it - trim it- edge it- blow it. Keep track or how long it takes to do. Look at how other yards compare to yours and that will give you an est. of your time. Plug in your $ per hour that you want to make and that is the cost.
    Get 1 or 2 and keep track of time, always refine you time estimates.
    Now the hard part--$ per hour. 3 parts, Cost of doing busi. / overhead---pay---profit. Always pay yourself. There should be profit after you pay yourself and any help. A lot of people will just keep anything over cost and spend that as pay, but a real business will always pay the help (including you), and still need to make profit.
    Overhead---Dont think that you stuff is payed for. A lot of people will say that they don't need to charge as much because the equipment is payed for. You are always paying for your equipment as you use it. (only gifts or stolen stuff are free). Up front or over time the stuff still costs money against the jobs.
    Do a search to get an idea of the life of a tool. Break it down to cost per hour. (WB $3000 life 1500hr. cost per hr. $2.00 just for example). Add gas, oil, blades, maintenance, come up with a cost total for each item you use, include truck and trailer and you should start to see what it cost per hour to be in business. Add your time for paperwork and sales, maintenance to equipment. Add all the little things like stamps, paper, phone, office stuff. Add all your fees for Insurance-bookeeping-license. Add for any taxes on the profit you make. If you want to make a 5% profit than add this to the top. Figure hours per year worked and divide the total by that , now you know what you need to make per hour. This is how you run a business, any business. If you sell widgets,cars, or service it's all the same. We are in the service busi. therefore we sell time. Your job as a business owner is to produce the most production at the least cost.
    If all you want to do is work outside for a few years and cut grass till you get a real job , jump in and have fun. If you want to create a landscape/maintenance business that will run on auto pilot in 15 years or that can be sold for a sum worth retiring with, spend some time learning business skills. Knowing how to run a business is much more important than knowing about what that business does. That is why big CEO's and other upper mang. can be put into almost any field and work it. The widget is not as important as the method of selling the widget. Hope this long winded answer helps. I probably should have said $35 and went to bed.
  4. BCSteel

    BCSteel LawnSite Senior Member
    Messages: 876

    Well there you go. Not much more I can say after that. Once you figure out your fixed costs then it is much easier to start quoting other wise you may not be making any cash and only breaking even.
  5. sgtyork

    sgtyork LawnSite Member
    Messages: 6

    tx PMLAWN ! I'm another newbee...very sound advice
  6. Green Pastures

    Green Pastures LawnSite Silver Member
    Messages: 2,457

    I started by calling every single lawn care outfit in the yellow pages and having them come and give me an estimate on my own yard.


    Then I measured out my yard and went to town on other peoples yards using similar estimates for similar size yards.

    I don't think there is some formula where we can tell you everything you need to know to make money on every single job. You'll have to learn most of it by trial and error just like we did.

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