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NOTABLE! Starting a lawn care service business

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Johnny boy

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Keep killin' it, dude!

I'm curious (and apologize if you've already answered this) but how do you break down your profit? For instance, how much do you reinvest back into the business vs. how much do you pay yourself with? Are things like advertising and your own salary built into business expenses or how do you structure that?

Just wondering because I'm all about all the math you do so I wonder how you calculate that out.
Employees cost about 10k a month, and other stuff is marginal. Gas, supplies like fertilizer, insurance, etc. it’s a tiny fraction. Labor it the biggest expense. Advertising is small too.

I pay rent, put aside a couple grand for other expenses, and take the rest out and try to save a bit. The savings will be for expansion.

I put as much as I can back into the business. I still pay 3000 a month for rent and have a decent lifestyle, but I’m not out here buying boats and shit. Every vehicle I buy is the next truck for the next crew. I probably spend like 6k a month on personal stuff.
 

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Johnny boy

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Nice thread and great progress over the years.

Are you the guy MJ mentions in his book about having monthly subscriptions for customer to cut their grass?

Also, what do you do in winter?

I have a cleaning biz here in Ireland and winter gets pretty rough and business dips a lot.
I have no idea. Which book?

Customers pay for 12 months at the same price. Profits increase dramatically and I go on vacation. Last year I got a $450 ski pass and went skiing 30 times. The year before I went to Thailand for 2 months and had a hell of an adventure in India. This winter we will hit up Mexico most likely for a couple months
 

mdot

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I think its unscripted .

I also thought of you when it was mentioned.
Nope, it's definitely in TGRRE , I remember listening to it the other day. I can't remember exactly where he mentions it though.

@MJ DeMarco I think that means this thread should get an upgrade to GOLD, no? :)
 

David Fitz

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I have no idea. Which book?

Customers pay for 12 months at the same price. Profits increase dramatically and I go on vacation. Last year I got a $450 ski pass and went skiing 30 times. The year before I went to Thailand for 2 months and had a hell of an adventure in India. This winter we will hit up Mexico most likely for a couple months

His new book, he mentions someone who cuts grass, it could be you.

That's a great plan to get 12 months upfront.
 

Johnny boy

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His new book, he mentions someone who cuts grass, it could be you.

That's a great plan to get 12 months upfront.
It's not upfront we collect card info and put it into our billing system to run automatically each month with no extra input needed from us or the customer. Auto payments. 12 months means that it happens all year so my winter income is great.
 

Johnny boy

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Nope, it's definitely in TGRRE , I remember listening to it the other day. I can't remember exactly where he mentions it though.

@MJ DeMarco I think that means this thread should get an upgrade to GOLD, no? :)
I just got it and looked it up. lol yup. Thanks @MJ DeMarco It's my first time making it into a book. :rofl:

Although, I gotta say...it's getting to become a first order specialized unit. I have worked 0 hours in the past couple weeks and the only thing I did related to my business was make the schedule for my guys. Takes me like 20 minutes in the morning and then I'm off to go do whatever I want.
 

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I just got it and looked it up. lol yup. Thanks @MJ DeMarco It's my first time making it into a book. :rofl:

Although, I gotta say...it's getting to become a first order specialized unit. I have worked 0 hours in the past couple weeks and the only thing I did related to my business was make the schedule for my guys. Takes me like 20 minutes in the morning and then I'm off to go do whatever I want.

You're welcome! Thank you for the insightful post based on mathematics!
 

David Fitz

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It's not upfront we collect card info and put it into our billing system to run automatically each month with no extra input needed from us or the customer. Auto payments. 12 months means that it happens all year so my winter income is great.

Ah ok, that's a pretty smart business model.

Not sure what Winter is like where you are, but here in Ireland you'd do your last cut in October and wouldn't need to cut it again til March or April.

Do you notice a lot of customers complaining about it during winter or do you still keep cutting?
 

Johnny boy

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Ah ok, that's a pretty smart business model.

Not sure what Winter is like where you are, but here in Ireland you'd do your last cut in October and wouldn't need to cut it again til March or April.

Do you notice a lot of customers complaining about it during winter or do you still keep cutting?
regular schedule ends after october, requested visits only until march starts, 1/mo max. most dont want any winter visits. Low priority. Some customers complain. We have contracts and 2-mo cancellation fees. We always lose a couple but out of 160 customers it's not too bad. You will always get bad apples.
 

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We use $400 mowers


Are these push mowers?

Where do you find a riding lawn mower at that price?

I ask because Im replacing my Bronco from Home Depot
 

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Johnny boy

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Are these push mowers?

Where do you find a riding lawn mower at that price?

I ask because Im replacing my Bronco from Home Depot
Walk behind self propelled honda residential mowers. 21 inch. Bought at Home Depot.

Employees will break stuff and misuse stuff. It is tedious to sharpen blades and change oil. We buy a $400 mower, use it until it breaks in a year, and get another one. We don't even change the oil. It's kinda funny but it makes so much more sense.

It's light and maneuverable

It fits through gates so we can do backyards at small residential properties (the most profitable properties with the fewest complaints)

It shuts off when you let go of it. 0 liability in case the mower's blade break isn't working properly on an expensive mower and a guy gets his fingers chopped off and I get sued for a million dollars.

Each crew has two of them. Easy and cheap to have redundancy so if one breaks we aren't screwed.

We only service small residential properties that take 15 minutes or so to do. That's what allows us a 50% profit margin with only about an hour a month dedicated towards handling billing since all 160 customers are on auto-pay with a card on file in our billing system.
 
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We only service small residential properties that take 15 minutes or so to do. That's what allows us a 50% profit margin with only about an hour a month dedicated towards handling billing since all 160 customers are on auto-pay with a card on file in our billing system.

What do you charge?
 

DoingDeals

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Dave Ramsey is always talking about how a man mowing lawns becomes a millionaire, eventually. I haven't read through this thread yet, but I will bookmark it for later.

My neighbor who was young out of high school decided to open a lawncare & landscaping company, he is absolutely making a huge profit bought 2 new vehicles recently & didn't go to college.
 

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A school friend ( that was over 35 years ago) made a landscaping business after studying. He is still working in that. He has some employees. But still in that job at 53.

So all be careful to make a plan eliminating yourself for scaling! @Johnny boy in on a good way regarding that.
 

wanttogofaster

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So they sign a 2 year contract that includes charging them the monthly service fee during the cold months? Surprising more people don't complain about it, but that's great!

How do you keep your employees busy during those months? Hanging Christmas lights and stuff? Or you just keep them in payroll while they take some time off?

Without knowing more details about your business, what I like about the idea is that it is simple.

I know a guy that has a drywall repair business. He only takes small 15~30 minute repair jobs, and according to him, he's making a killing.

I compare the simplicity of your and his business with ours and I have a lot more to take care off. Although the profit per job is a lot higher, if we had 160 customers in a year, that would be a lot of work/personnel to be able to keep up with the demand.
 

Johnny boy

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So they sign a 2 year contract that includes charging them the monthly service fee during the cold months? Surprising more people don't complain about it, but that's great!

How do you keep your employees busy during those months? Hanging Christmas lights and stuff? Or you just keep them in payroll while they take some time off?

Without knowing more details about your business, what I like about the idea is that it is simple.

I know a guy that has a drywall repair business. He only takes small 15~30 minute repair jobs, and according to him, he's making a killing.

I compare the simplicity of your and his business with ours and I have a lot more to take care off. Although the profit per job is a lot higher, if we had 160 customers in a year, that would be a lot of work/personnel to be able to keep up with the demand.

It's a 1 year contract, 12 equal payments for billing simplicity

"I'm paying even in the winter months?"

"we can change your plan to only be charged during the growing season, your monthly price will just go up, it doesn't change the yearly price"

"okay"

works every time.

This winter we will have the same revenue so we would be able to have employees go on a 3 month vacation and be okay. However, I'm not going to do that. I'm paying for the time so I'm going to get my money's worth. We will have them hang christmas lights. In the future I think we will shave off some of our workforce in the winter months when we are at a larger scale. When I hired these men I told them the job is not just seasonal so I have to stand by my word and keep them for the winter.

The goal is to have the christmas lights replace the payroll costs for the winter so that the lawn care money is 100% profit. 24k a month in the winter going straight into my pocket would be very nice. I think we can do it as long as I can be disciplined/effective enough to schedule enough work for them. It's more of a headache to schedule one time jobs like light installations which is why we do the recurring work 95% of the year.

Regardless, the entire focus is always long term. Always thinking about what the company will look like at 1M a year, 10M a year, 100M a year, etc. And then reverse engineering that to happen as quick as possible. I get so much time to think only about this, visualize it, imagine the details and the plan over and over.

You're right, it is very simple. It does have its nuances which other companies overlook and then their lack of success is confusing or seems random.
 

wanttogofaster

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Thank you, the more I think about this, the more I like the idea.

As I said, I compare it to our service business and it's definitely a lot more simple.

Right now, we need to go out and look at the jobs.
Work on designs/estimates.
Make changes to said design/estimate if required by homeowner.
If they decide to move forward with the project, we need to order everything.
Deal with deliveries, delays, etc.
Schedule the work and go do the installations.

I've thought about broadening our offerings, but that would only make it worse. Narrowing them down would not help that much either.

Not sure if you've mentioned it, but do you have a warehouse to park the trucks/trailers? I could start with one truck and one trailer from our house, but would need extra space even if we add an extra crew/truck.

Thanks!
 

Johnny boy

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Thank you, the more I think about this, the more I like the idea.

As I said, I compare it to our service business and it's definitely a lot more simple.

Right now, we need to go out and look at the jobs.
Work on designs/estimates.
Make changes to said design/estimate if required by homeowner.
If they decide to move forward with the project, we need to order everything.
Deal with deliveries, delays, etc.
Schedule the work and go do the installations.

I've thought about broadening our offerings, but that would only make it worse. Narrowing them down would not help that much either.

Not sure if you've mentioned it, but do you have a warehouse to park the trucks/trailers? I could start with one truck and one trailer from our house, but would need extra space even if we add an extra crew/truck.

Thanks!

So you're scrapping the home organization service business?
 

Killin

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we don't mess with sprinklers anymore. Not enough customers care and it's been annoying for the ones that wanted us to turn on/off their sprinklers. We definitely don't install regular sprinklers. The original idea was to just have a timer attached to a hose splitter that has a couple of hoses that run along the side of the lawn and go to a couple of above ground sprinklers since it would be cheap, keep the lawn watered automatically, and would add some value to customers in a way that low-wage employees could do.

Here is our schedule for customers that are on a biweekly schedule (premium plan). These services are not mandatory for each month but on an "as-needed' basis.

View attachment 35998
Good shit.

Some scattered thoughts:

I had just been doing maintenance (HOAs, commercial, high-end residential) for one of the big, long-standing landscaping companies in the area (WA state) -- after burning out at a startup.

That service schedule looks about right. Though we did fertilizing four times a year (for what reason, I don't f*cking know); sprayed as-needed; "blowed" patios, walkways, and driveways "every week;" edged twice a month; and mowed every week.

Maintenance landscapers hate their jobs. The best workers were always the hispanics with families or had something going back on at home (Mexico, e.g. "I need money for bitches"). And there's a ton of hispanics in WA state. On the other hand, the hardest workers were the ex-tweakers (who were usually chugging energy drinks and smoked a pack of ciggies all day).

Construction landscaping is another avenue to look into. You technically need a landscaping engineer (or whatever it's called) to legally call yourself a "landscaping" company though. I've seen some "talent" poached from the neighboring Idaho region, where minimum wage is shit-all.

Oh yeah, and just about everyone I worked with had problems. That's the deal with the trades -- especially unskilled shit -- you're dealing with people who can't get jobs anywhere else. "Good workers are hard to find," because good workers can get better pay and better conditions elsewhere. Expect turnover to be constant if you're really pushing your guys (10 hour days, go go go mentality, etc.). But afaict you're doing residential work. Atleast that's what I'm guessing from what you're paying. Residential has a rep for being laid back, less pay, but better quality of life -- so turnover might be lower.

HOAs are goldmines, if you can get an in with the president (who usually lives there). Ironically, we did work on an HOA where one of the dudes living there ran a lawn-care company, but wasn't allowed to mow his own lawn (anti-competitive practices helping keep the lawn barons rich).

Scrambled thoughts. Been a bit busy, and I only skimmed through this thread.
 

Killin

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Over the last month we have been replacing the least profitable customers and increasing profitability. Staying right around 24-25k a month but all properties are great and customers complain very little. The guys work fast and it's low stress. They get paid well and enjoy their jobs. I think you need to give people a reasonable standard that's 'good enough' and not focus on squeezing every ounce of profitability out of employees. Have good systems and your employees will like working. One thing we do is if they finish all the jobs early, they can head home. They get paid for the full 8 hours though, as long as there isn't a trend of customer complaints. They think I'm the most generous man alive, when in reality they are just becoming more profitable and are attributing it to my kindness. I still spend the same on payroll either way, whether they are hourly and working slowly with no accountability, or they are incentivised and work faster. I could stuff their schedules and leave 0 margin for error and make them hate their jobs, but then the business is at risk of employee turnover, falling behind on the schedule and pissing off many customers.

OldCo did this to us. Everyone did, in-fact, hate their jobs, but the amount of money the Co made was insane.
 

Johnny boy

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Good shit.

Some scattered thoughts:

I had just been doing maintenance (HOAs, commercial, high-end residential) for one of the big, long-standing landscaping companies in the area (WA state) -- after burning out at a startup.

That service schedule looks about right. Though we did fertilizing four times a year (for what reason, I don't f*cking know); sprayed as-needed; "blowed" patios, walkways, and driveways "every week;" edged twice a month; and mowed every week.

Maintenance landscapers hate their jobs. The best workers were always the hispanics with families or had something going back on at home (Mexico, e.g. "I need money for bitches"). And there's a ton of hispanics in WA state. On the other hand, the hardest workers were the ex-tweakers (who were usually chugging energy drinks and smoked a pack of ciggies all day).

Construction landscaping is another avenue to look into. You technically need a landscaping engineer (or whatever it's called) to legally call yourself a "landscaping" company though. I've seen some "talent" poached from the neighboring Idaho region, where minimum wage is shit-all.

Oh yeah, and just about everyone I worked with had problems. That's the deal with the trades -- especially unskilled shit -- you're dealing with people who can't get jobs anywhere else. "Good workers are hard to find," because good workers can get better pay and better conditions elsewhere. Expect turnover to be constant if you're really pushing your guys (10 hour days, go go go mentality, etc.). But afaict you're doing residential work. Atleast that's what I'm guessing from what you're paying. Residential has a rep for being laid back, less pay, but better quality of life -- so turnover might be lower.

HOAs are goldmines, if you can get an in with the president (who usually lives there). Ironically, we did work on an HOA where one of the dudes living there ran a lawn-care company, but wasn't allowed to mow his own lawn (anti-competitive practices helping keep the lawn barons rich).

Scrambled thoughts. Been a bit busy, and I only skimmed through this thread.

The Hispanics and tweakers are the worst employees you could have. I know because I've hired and fired so many of them. 18-25 year old right-wing guys that wear Romeos and are about to go work a construction job in a couple years are the best employees. Fresh out of high school. Good families.

I have had basically ZERO problems with the ones I have now. They are easy to get along with, do good work, appreciate the pay, and more importantly....they aren't pieces of shit.

We have them work like 5 hours a day and pay them nearly 800 a week and we still have a 50% profit margin. They tell me this is the best job they've ever had by a huge margin.

HOA's are garbage. They want you to sign their contracts not the other way around. And f*ck net-30 pay. We get paid with auto-payments each month before we even do the work. We processed about 2000 transactions this year and I spent about 5-10 hours this entire year on anything related to billing/payments.

What you said is the typical stuff echoed by all of the other companies in this industry which is why they all have the same problems and we don't.

"If I'm taking yalls advice I'm probably making yalls mistakes"
 

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This is such a great thread man, congrats on how it's going so far! Going to send it to my friend that just decided to shut down his landscaping and bush regeneration biz as it had broken down his body too much.

He had a car accident when he passed out due to low sodium levels or something after drinking too much water and flushing a lot out of his system (something along those lines). Was in hospital for a few days.

His drug and alcohol came back clean but he could have been smarter with his health (obviously lol). Still, sounds like a tough, hot job doing what he was doing.
 

Johnny boy

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This is such a great thread man, congrats on how it's going so far! Going to send it to my friend that just decided to shut down his landscaping and bush regeneration biz as it had broken down his body too much.

He had a car accident when he passed out due to low sodium levels or something after drinking too much water and flushing a lot out of his system (something along those lines). Was in hospital for a few days.

His drug and alcohol came back clean but he could have been smarter with his health (obviously lol). Still, sounds like a tough, hot job doing what he was doing.

Gotta hire employees and use systems to manage them better in that case. I work about 3-4 hours a week and it’s all admin stuff. Haven’t touched a mower in a long time.
 

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