How profitable are you?

Discussion in 'Business Operations' started by NJlandscaper908, Nov 11, 2010.

  1. NJlandscaper908

    NJlandscaper908 LawnSite Member
    Messages: 37

    If you guys don't mind profitable is your lawn maintenance operation? I always made out quite well for myself but I have been out of the maintenance end of it for 4 yrs. A friend of mine recently said to me "theres no money in lawns", that you are lucky to make 10% profit. Do you guys find this true? Do you count on the lawns just to get you the "extras" or do you make a good living from them?
  2. Greenboy24

    Greenboy24 LawnSite Senior Member
    Messages: 297

    There has never been a huge margin on lawns so right now that is truer than ever. In order to make money on lawns you need to do 1 of 2 things. Work in volume. Event eh guys who sell themselves as an upscale service could never survive if they did not have some level of high voulume. Its always relative too, whats big for one is peanuts for another, you need to find the happy balance thats fits you, your crew and your equipment.

    The second way is just do everything under the table with your neighbors craftsman that you took off his hands because it wouldn't start and it was just taking up space.

    That being said I do believe 10% is on the lower side

    Your call mi amigo
  3. GlennZ

    GlennZ LawnSite Member
    Messages: 56

    I assume that 10% is after paying yourself fair market value? So many people quote profit without their own salary so it makes is sounds more impressive. I doubt many companies make 10% net no matter what service they do. More likely they are struggling to make a decent wage for themselves. I see it all the time.
  4. DA Quality Lawn & YS

    DA Quality Lawn & YS LawnSite Fanatic
    Messages: 9,196

    There is money in mow and blow. Especially if you max yourself out with volume as a solo op. Keep your overhead down and you can net way over 10% easily, even after taxes.

    Once you start to hire on, your volume had better go up substantially to keep pace, due to all the extra overhead you bring on.
  5. GlennZ

    GlennZ LawnSite Member
    Messages: 56

    But are you running your solo op as a real business with all its expenses? Do you have business insurance? Is all your equipment being costed out to the company so you have the funds to replace them? Are you charging yourself fair rent value if you run out of your house?

    My only point is that when people quote their net profit we are not comparing apples to apples.
  6. juststartin

    juststartin LawnSite Senior Member
    Messages: 341

    IMO, the only reason people pay themselves a salary is to minimize ss taxes. 10% profit margin sucks.
  7. snomaha

    snomaha LawnSite Bronze Member
    from midwest
    Messages: 1,147

  8. snomaha

    snomaha LawnSite Bronze Member
    from midwest
    Messages: 1,147


    In any service industry the market has a way of dictating net profit. 10% = good....15% = great...anything over 15% enjoy while you can because the market will figure you out and bring you back down.

    Just my two cents.
  9. Will P.C.

    Will P.C. LawnSite Senior Member
    Messages: 966

    Very good chance that if most guys sat down with an accountant they would not have made a dime in the first 2-5 years
  10. juststartin

    juststartin LawnSite Senior Member
    Messages: 341

    Being as s-corp allows you to avoid paying ss taxes on your entire profit.

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