How much profit?

Discussion in 'Business Operations' started by FrankenScagMachines, Mar 6, 2001.

  1. Majestic

    Majestic LawnSite Member
    Messages: 42

    Everyones profit or charges will vary depending on overhead and market place.I would think in your situation you will price jobs at a flat rate (not by the hour).Look at the job add 15 min for underestimating then charge no less than 20 hr.As you get more involved you will raise prices and cut out less profitable accounts.I started by myself doing mainly maintenance never knowing what would happen . .Growing is never easy trust me Ive had many growing pains along the way and still do.Working for less than 20 hr just wouldnt be worth your while you wont realize until tax time whats involved.less than 20 hr - you are farther ahead to work for someone else.GOOD lUCK
  2. cclllc

    cclllc LawnSite Senior Member
    Messages: 911

    there are other things to consider-besides gas count insc.on biz,insc in truck,wearntear on truck,fuel to go to and from job,cost of running equip.,equipment itself and what is left is yours.alot of customers don't realize what we spend.
  3. turfman99

    turfman99 LawnSite Member
    Messages: 212

    Open an Excel spreadsheet and build your budget of costs.

    Labor and Materials are direct costs. They should total no more than 50% of your gross income. 45% is more like it.

    By labor, if your a one man operation, thats what you pay yourself. If more than that then all your labor. at some point wiht multiple employees, you become overhead and go belwo the line into general and administrative expense.

    If you make $5,000 a month then you should have to pay your self at least $ 2,250 before taxes. Thats not very much.You then have $ 2,750 to pay for your insurances, gas, equipment payments, truck payments, repairs and all the other items that need to be paid.I would be looking for at least $ 750 or more in net profit or don't bother being in business. Put the money in mutal funds and get a day job. It's a better use of your money.

    I will be publishing a guide to Starting and expanding a one person landscape business in another month or so. It will have budgets and other financial items. If your looking at a full time business you need to be prepared to replace $ 36,000 in salary and benifits. Base your budget off that and build backwards from your avaliable hours to come up with your labor, and diect costs and overhead costs. Get the cost then add at least 15% profit. You can make 20% or better net profit in this business after you pay your self. To make the big bucks, you need to expand and sell more hours, which brings you more profit.

  4. skyphoto

    skyphoto LawnSite Member
    Messages: 221

    I would have to say that you and you only can decide what your time is worth because for us to try and tell you that you must make this amount or it is not worth your time is crazy because I have found that I average about 14.00/hr after all taxes and upkeep which most people would say im crazy for having my own business and only averaging this amount BUT Im free to run an errand for my wife if needed or be at the school for my kids play and be there for my 6yr olds to get off the bus @3:30 everyday which I was not b4 I started this business It all depends on what is important in your life and Im not saying $ is not important but be sure to listen to your heart and not only the bottom line!!!

    Good luck at whatever ya decide to do!!

Share This Page