"Just won a big one" comes to an end...

Discussion in 'General Industry Discussions' started by Herrick, Dec 9, 2012.

  1. Herrick

    Herrick LawnSite Senior Member
    Messages: 506

    In reference to this thread:http://www.lawnsite.com/showthread.php?t=253180 from a few years back, for any of you that remember.

    Summary: won a large contract for a retirement community, 46 acres total, about 1/2 turf. Mow, trim, blow and bush trimming twice a year. Quit a 36k/yr job to do this.

    At first things seemed to go really well. I was having a blast doing what I loved. Funny how over time reality sets in.

    First year (2009) was a one year contract. I recruited my dad to help out and we worked our way through it. I did all the trimming and blowing and dad helped with 1/3 to 1/2 of the mowing. Towards the end of the year I started realizing how things were wearing on me... Wife volunteered to come out and help as she had free time between her part time job and our 4 kids. In September I wound up purchasing a second (new) zero turn so she could quit her job and come help the following spring. Now i had 3 mower payments, plus the typical fuel, ins, etc... Typical growing pains with doing a large complex like this for the first time, few complaints, but you can't please everyone, right? Especially with almost 300 retired folks staring out the window at you. Got a three year contract signed that fall/winter. I was on top of the world....

    Second year (2010) is when things really started to come apart... With the wife now helping full time, I picked up two school districts along with the other 20 or so small stuff we did. With three machines going, we should be able to knock this out in no time.... Wrong! My wife soon realized that this was actually like work, especially trimming around almost 80 duplexes. We start getting behind a day or two because of rain, and the spring growth quickly gets away from us. These 300 retired folks now start calling the executive director because the head of maintenance keeps blowing them off. By August we receive a letter saying that if things don't improve and we don't come up with a better plan to keep up on things, we won't be working there next year. We end up hiring a high school kid to help trim, more money going out instead of in. We end up stepping up and keeping the contract.

    Year three (2011) One school district is only a year contract, so we don't re-bid that one, and cut out a couple other small jobs to try to devote more time to this big one. Head of maintenance is replaced with a great guy and communication of issues resolves them before they can get out of hand. High schooler is still with us, and things actually go pretty well... Except the budget. This is when we start to realize how much this is really costing us to do.... $1200 a month in fuel, $600-800 a month in labor, $750 a month in mower payments... Suddenly it's getting harder and harder to keep up with things. I start to realize that we can't really afford to do this anymore... But by now it's late summer, and we have no money saved up.... We can't rely on snow money to replace what this contract pays over the winter (we had it set up on 12 month billing). We've got to finish this out.
  2. TriCityLawnCareLLC

    TriCityLawnCareLLC LawnSite Bronze Member
    from Ohio
    Messages: 1,025

    So, what's the bottom-line of your post?

    One thing that stands out to me (and i may be wrong) is you saw some pretty big contracts, and estimated them based on you doing all the work- no problem other than what we think we can handle isn't always accurate. So in turn you came in way under what the other guys were doing the work for. I'm no going to throw the term "lowballing" out there because i think it's an ignorant term used to frequently but in essence you are doing the work cheaper. But, it does seem like you focused on the numbers and didn't anticipate for expenses.
  3. Herrick

    Herrick LawnSite Senior Member
    Messages: 506

    Now we're on to this year. Good thing we stuck it out, with the lack of snow we would have been living in a cardboard box. I cut the high school kid to save money. Start figuring out where we can save time... Thank goodness for the drought, saved us thousands in fuel. We were able to get by mowing once a month for almost three months. I also cut some more accounts that were farther away to save windshield time. Loose a few others due to various things, but I know at least a couple are from lack of attention. We spent so much time on this big one that we end up loosing others... Income takes a hit again, plus the drought cuts out the rest of the clients for a few months.

    We told the head of maintenance that we won't be bidding again for next year. He wasn't surprised at all. He saw how I was killing myself trying to keep up. About 50 man hours a week, plus trying to trim almost 2500 bushes twice a year with three people just wasn't working. We made it through, but even facing winter with not near what I should have saved up, I am less stressed than I have been in years. Re-focusing my attentions on quality and being proud of what I am doing. Not just rushing through to get on to the next one. Sorry folks, you can kill yourself trying to do three times more than you should... Me, I'm going to watch my kids grow up. Not leaving the business altogether, but I think I may have to find some part time work to make ends meet until things are built back up to where they should be for a full time solo guy.

    Talk about a learning lesson... At least I am really confident moving forward about what it takes, and what my abilities are.
  4. Herrick

    Herrick LawnSite Senior Member
    Messages: 506

    I actually was $500 more per year than a large firm from out of town, but was given the opportunity to match them since I was local. Not so much of under bidding, as not being set up to do the work in the first place. If I hadn't had to go out and get more equipment, and was just paying $10/hr kids to do all the work, with plenty of labor to call on when things got busy, it would have been much better. Problem was I couldn't keep five guys busy outside of this account. I couldn't afford to get another truck, trailer, etc.... The business outgrew itself basically and I wasn't ready.
  5. chuacro

    chuacro LawnSite Senior Member
    Messages: 601

    I think I will stay solo.
  6. TriCityLawnCareLLC

    TriCityLawnCareLLC LawnSite Bronze Member
    from Ohio
    Messages: 1,025

  7. larryinalabama

    larryinalabama LawnSite Fanatic
    Messages: 19,631

    Another case for being debt free. It happens over and over. Ive been called dumb, white trash and a lot of other unkind things for recomonding people run their business debt free.
  8. jrs.landscaping

    jrs.landscaping LawnSite Silver Member
    from Maine
    Messages: 2,763

    I might be missing something, but four full time employees to make 30k? A 3 man crew should have been able to knock that place out in 1.5 days MAX.
  9. 205mx

    205mx LawnSite Silver Member
    Messages: 2,393

    Well it sounds like some of your lawns were actually costing you money. interested to know how it turns out. good luck to you
  10. Herrick

    Herrick LawnSite Senior Member
    Messages: 506

    Who said anything about 30k? This contract was closer to 40... And it took a three man crew 2.5 days in average growing conditions... Granted my dad and wife aren't all that fast, but 5-6 guys could probably get it in a day. We averaged less than an acre an hour because of how chopped up this place is. There was 10-12 hours a week of just string trimming. Three of us could get it mowed in a good 8-9 hour day.

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