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Discussion in 'Lawn Mowing' started by qualitycut, Jan 24, 2008.
What are your companies goal profit margins for your mowing side of the company?
My goal is 40%
Is that after paying yourself your wage?
What is the best way to calculate your profit margin?
We have full time jobs that provide us with a steady income with full insurances and benefits. The mowing business takes place after work and during weekends. That said all of the funds are paying off the truck mower and capital debts we have. So all of the profits are being turned around and placed back into the business. But this season I'd say or net take home will be something like 60%.
Here's how I do mine
If your expenses and overhead cost cost you $30. per hour and you charge $40./hr. then you profit margins is 33% (30/10= .33).
Another way is to take your expense cost (all the things that you need to do the job) $25 and add your profit margin 50% ($30 + 15 [profit]), then take your overhead out of that[ $45 - $5 = $40. net profit.
Your margin on the 30/40/10 scenario would be figured by taking your profit from the total sale price. In your case $40.00 is what your selling price is. $10.00 profit from $40.00 is a 25% Margin.
25% - 60% ?
And you guys ***** about a dealer making 20% and less!!
You are going to open up a huge can of worms with this thread. I started a thread in which I asked about profit margin. You are going to have a variety of answers based on the size of your business and expenses. And as mentioned in the other thread, just because you have a low profit margin does not always mean it is a bad thing. Read through the thread below. You will see how I got way more than I ever asked for in posing this question.
o.k. l have another question, can someone tell me the difference between "expenses" & "overhead", I thought they were the same???? What do I divide those by (total hours worked????) I don't know?????