Where did you start?

Discussion in 'Lawn Mowing' started by mwalz, Jul 26, 2014.

  1. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,872

    At our company, we categorize irrigation installs in general with "landscape construction" (design/build) work. Because the same teams do that. We do a fair amount of just full irrigation-only installs. But more often, the irrigation system installs we do are part of a full landscape installation where we're doing a patio, seat wall, lighting system, new sod lawn, irrigation system, plants & trees, etc.

    The Landscape Construction Division, which includes the irrigation installs, accounts for about 45% of our revenue. Irrigation Service & Repair division accounts for about 12% and Landscape Maintenance division accounts for the remaining 43%.

    If I were to guess how much of our total sales are just irrigation installation (I could look it up but I don't have that info. handy right no), I'd say it's probably around 10%. New Irrigation installs are down since 2008 and have only just started to recover. But other things like lighting, patios, and outdoor living areas and maintenance have grown a lot since then. Just not as many people putting a priority on irrigation since '08. In Oregon you can almost get by without one. Your landscape will suffer or you gotta drag the hose a lot. But it's not absolutely necessary. So, for some reasons, not as many people are insisting on irrigation systems as before 2008. It is seen as more of a luxury around here, these days. Where before 2008 it was seen as just something everyone was getting.
  2. larryinalabama

    larryinalabama LawnSite Fanatic
    Messages: 19,349

    Jim Lewis, who says hes alaways paid cash for everything from the start.
  3. snomaha

    snomaha LawnSite Bronze Member
    from midwest
    Messages: 1,231

    Interesting that people aren't insisting on sprinklers anymore in your area - guess it makes sense with your climate.

    Our market slowed a bit post 2008, but was not affected the way many were. Installations are strong in our region and not to many houses go in without sprinklers. Between new construction and grass jobs we will get 250-300 in this year with some help with weather. We have developed a full time sales position just up-selling new system owners with landscaping, enhancement services and turf care.

    The sprinkler division has really become the tip of the spear for cross-selling all other services.
    Sprinklers 39%
    Maintenance 29%
    Turf care 18%
    Landscape/hardscape 15%
  4. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,872

    That's true - the part about me always having paid cash for everything. It's been a struggle to do that. But I still maintain it's the best way to do it. When things got really tight in 2008-2009 I watched a lot of my competitors go out of business or go through bankruptcy because they over-leveraged themselves and couldn't keep up the payments when the economy took a dive. I had NO payments to keep up on. So that helped us survive that period of time. Also, our business is still fairly seasonal here. Income in November, December & January can be 1/4 of what it is in the spring/summer months. During those months, it's nice not to have any payments to make.

    We own 21 trucks, something like 14 trailers and a ton of other equipment not to mention a lot of inventory in our shop, vehicle lifts, tools, etc. - all 100% paid for. My personal truck and my wife's SUV are 100% owned. We've just slowly bought stuff over the years as we had some extra money. Reinvest back into the business. It's not necessarily the easiest way to go sometimes. And it means we don't always have brand new stuff. The trailers and equipment is usually purchased brand new. But the trucks, vans, etc. usually are not. But I'd rather have stuff a few years old and 100% paid off than brand new and have to live with lots of payments each month. There are definitely times in our history when - if I had had payments to make on all our vehicles or equipment - we wouldn't have survived those times.
    Grace Irrigation likes this.
  5. larryinalabama

    larryinalabama LawnSite Fanatic
    Messages: 19,349

    Its quite a success story indeed. No telling how many threads Ive been in saying you cant ever grow and become big without debt.

    Since everyone is spilling there guts....

    My first Lawn business was in So. California from 1987 to 1992. I actually bought the business for 8000$ and only thing I provided was the truck. So it was baisically turn key. I made a real good living, but still wanted to get out of California and in 92 I sold the business and moved to Alabama.

    My passion was to get another Lawn Company started, but it took 15 years to do so. In 2006-2007 I Started purchasing real nice used equiptment, and already had a lot of commercial stuff that I use for my own properties. In 2007 I started out part time, and I did that for 18 months, then went full time. My total initial investment including the box truck I bought was 17000$. And my only major purchase since then is a Toro Grandstand at 4500$. All were purchased with Cash.The good part is I think I could still get most or even more than that for the equiptment if I were to sell out today. The last 3 years have been pretty good, but this year is slightly down.

    Im almost 50 and growing into a larger company is not something I desire, and I also have a few other interests.

    I do hope to do this till I expire as I still enjoy it as much ore even more than when I started. The Biggest Downfall is lack of Winter Work, but Ive been able to manage, although year may be a problem.
  6. JimLewis

    JimLewis LawnSite Fanatic
    Messages: 6,872

    Yah, that's our biggest problem too. We actually make MORE profit from the maintenance division during the winter months, because we still charge the same flat fee all year long, even though our labor goes down by 60%, fuel is down by 60% and other costs are down. But that extra profit only goes toward balancing out the less-than-profitable other two divisions or our company during that time of the year. We really have to watch every expense for several months each winter. It's gotten better and better each year. But still hate the winter months, in terms of income and cash flow.

    If we could make the kind of consistent money we do in the spring and summer all year long, this would the best business. It's still a good business. I enjoy it. But I really hate the winter time. I want to be out landing jobs, doing jobs, gaining customers. But the work is just few and far between. It's like if you had a corporate job and your boss came to you every day at 2:00 and said, "I got nothing else for you to do. Why don't you just sit here and wait for the phone to ring and I'll pay you 60% less per hour for the rest of the day." That's what I feel like every winter. Sucks.
    Grace Irrigation likes this.
  7. inzane

    inzane LawnSite Silver Member
    Messages: 2,478

    i give it 3 days until this threads closed.. :laugh:

  8. Bumpmaster

    Bumpmaster LawnSite Fanatic
    Messages: 19,871

  9. JMK26

    JMK26 LawnSite Bronze Member
    Male, from Missouri
    Messages: 1,876

    I love paying cash, it's what makes me get up an 2 hours earlier in the morning.
  10. JMK26

    JMK26 LawnSite Bronze Member
    Male, from Missouri
    Messages: 1,876

    ETS with an honorable discharge from the Army in 2009. Wanted to take a month off from doing anything whatsoever.

    After 2 weeks of sitting on my butt I answered a help wanted ad for a lawn care company wanting a helper.

    Showed up on Monday with the owner introducing me an another guy and saying "One of you will have the job at the end of the week."

    Busted my butt, asked questions...by Wednesday I had the job the other guy was dropped off at the shop with no job.

    Asked about types of grasses, asked about mulch, asked about pruning. Then started asking about overhead, books, and all aspects of paperwork and how to run bid and estimates.....asked asked asked....learned learned learned.

    Winter came, not enough snow removal to support me and the wife......went into HVAC with my GI Bill and got a job where my uncle works. After about a year of that crap, I talked to the lawn care guy that hired me. I used a push mower on my first clients while I worked with my original lawn care guy.

    I then got a walk behind while I still worked with my mentor. As the tables turned and I got more clients, I worked less hours and he scheduled around me....

    I finally was able to go at it on my own....I still call him for advice and stop in to say hey and see how things are going....

    I now have a truck, a 7'X12 trailer with a 52" and a 36" mower. 2 trimmers, a blower and the typical tarps, wheelbarrows, shovels rakes etc and taking classes for horticulture degree, and studying for my pesticide license.

    I'm about to pull the trigger on a new blower, a snow blower for this winter, and a new truck this coming Spring (2015).

    I have 50 accounts, and turning people down because I want a buffer for when I have to actually hire someone. I could hire someone at $12 an hour right now, but the cost for hiring somone at $12 an hour is actually $18 an hour and I would like some kind of buffer for that additional cost and I can work the rest of this summer as solo and bank some money for an employee in the future.

    I pay cash, but I do have a couple things on credit simply because I want to have some kind of credit line for my business.

    I actually started out only wanting 50 or so accounts, and side jobs, but once you taste success you kind of get addicted to doing more. That's why I'm doing the classes and readying to hire someone.

    Now I kind of want to have a couple crews, get a landscape designer and crew for him. I modified my business plan to plan for a landscape crew in another 4 years with 2 mowing crews in another 2 years.

    The way the books look I'm on track, and that makes me happy.

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