Starting (and Fastlaning) a lawn care service business

[ZCP]

take your profit .... .set aside for taxes in a separate account. split the rest 50/50. invest half back into this business to make it more efficient. put the other half in your 'invest in other stuff' account.

don't get too far ahead of yourself with a lawn business. it has scale problems that come up. farm this for a while. get through a winter. then see where you are.

 

[minivanman]

They can't be independent contractors. He tells them when and how to do it, then furnishes the equipment for them to work with.

I used to be like that.... until I figured out I could make WAY more money by hiring independent contractors most of the time. If I can't make someone an independent contractor I try every way possible to pay them on commission. I was always a worry-wart but that has changed. I learned.... it is, what it is. That is what allows me to be invested in many small businesses. When I first started my own business I thought I had to micro-manage. Now I see that I can make way more by being a part of 40 businesses and never having a worry than being the life-line of 1 business thinking I need to know exactly when everyone's heart is beating. But, it is HARD to let go at first.

 

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[Johnny boy]

These jobs are more profitable but less scalable. It's a trade-off.

I've been seriously thinking about snapping up some used equipment this winter and putting a crew out there next spring just because the local companies SUCK at marketing. I've been in this house for over a year and have gotten one door hanger, one crappy flier and I think one postcard from lawn mowing companies. I could do the marketing and have a couple of guys execute. I have no desire to take it beyond one truck but it could be a nice side business given the quality of the competition.
Trugreen does market heavily but they are sprayers, not mowers.
The typical mower here looks like a bag of rags. Twice recently I have seen this scenario- a guy with a truck and trailer with no lettering, mowing grass wearing jorts and no shirt with a cig hanging out of his mouth. NOT the same guy. These are very nice neighborhoods too. If you just require that your employees be fully dressed you are way ahead of the competition.

I have the guys wear company polo shirts and they’re both English speaking 100%.

We invoice online and are satisfaction guaranteed. Everything is professional.

I stole some practices and strategies from the car lot.

 

[ZCP]

to continue ........ my kids and i bought several vending routes. we could have started and set them up ourselves over the course of a year or so. our spreadsheet said that for a little more than it would cost us to do ourselves, we could buy instant profits and still have a sellable asset. we pulled the trigger and bought existing routes to save TIME

also .... negotiate with the seller. lower number, rolling buyout, systems, other items they can throw in, any spare parts, other lists, other products, the knowledge of what they would do next to grow the business, etc. .... all worth something

and @Johnny boy Great F*cking job, dude!! Keep slaying it!

 

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[Johnny boy]

Would a lawn service be considered a fast lane business. If not, I feel like it could be a good vehicle to get you closer to a fast lane business. I feel like this would be much better than regular job trading time for money.

If you're looking for cash to use for a business idea, I would get into sales. Unless you have some other special skill or unique situation like owning some income-producing asset, sales will be very useful. I did well. My best friend just made 10k a month ago and it's his first year selling cars. He is using sales to get money to get into real estate and that's his goal. He said he could be happy shooting for 50 million. That works for him. I just feel like I'm choking if I'm not doing something that really pushes me. It just depends on what you really want.

 

[Johnny boy]

Any tips on what you use to make websites so fast and professional looking? Your mouse trap one was really nice! Do you us a page builder or hand code all of it? @Johnny boy

-Wordpress
-Divi theme builder
-Revolution slider (insert the shortcode into a “code” section in divi)
-Connect useful software such as active campaign and calend.ly

The lawn care website is much more impressive than the media mousetrap website but it took a few different versions and a lot of creativity and time to get it the way it is.

 

[Johnny boy]

Awesome! What is your hiring process and your process for training the new hires to make sure they do quality work?

1. Hire based on gut feeling and specific needs of that moment in time. Sometimes a guy who’s experienced is needed more than a guy who is reliable. Sometimes the other way around. You just interview people and try them out and replace when it doesn’t work. No science to it. My biggest tip is to create a job for them that doesn’t rely on them being great. Have great systems that can allow for employees to be retards and still have things work out.
2. I work alongside the least competent people and the best guy runs the other crew. I show everyone how we do things and I give the other crew the easiest work (for now). Slowly we raise everyone’s level of competency, then give them autonomy while stressing quality over speed, then as I add more customers to the schedule I impose time goals based on how much customers are paying. 8k a month per crew is the goal capacity. If we are working full time and can’t get there I say “stay under 60 minutes at Bobs house” in our notes and it goes like that. Quality control is done by occasional drive by’s and customer complaints. No complaints = no problems 99% of the time. This is not a game of perfection. It’s a game of “good enough”.

 

[Johnny boy]

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

 

[Johnny boy]

ok, thanks. I started putting the TOS in bottom of the invoice, but pdf contracts & signatures might hold up better.

Do you still find (square footage)^.3 (x20) valid as a rule of thumb? I am bidding my first properties, & have no historical cost or time data.

with that formula a 2000 square foot yard would cost like 200 a month for weekly service (I made the formula to determine a weekly price). For a weekly customer I'd probably charge right around there, since weekly shouldn't be exactly twice as much. A lawn that you service every other week and do things like trim hedges and fertilize doesn't take twice as much time if you visit twice as much. More like 80% more since you aren't doing the extra services like triming hedges each visit. So it should only be 80% more or so than the biweekly service. Plus you're adding more revenue, less traffic to your customer service, lowering ad spend per new customer by having a higher monthly payment from a single customer so we don't mind giving them a small discount for weekly services.

I could use that formula but I don't. I think about time spent at the job, how close they are to other properties (increases the time per job since we factor in driving time as well, give steep discounts when neighbors sign up), and other factors go into pricing the jobs.

If it's a quick yard (like 10 minutes ish), it should be anywhere from 80-130 a month plus tax for 12 months for biweekly services. If its a 15-25 minute yard it should be 150-200. If it's 35 minutes or so it should be like 220-275 a month.

so a 10 minute yard +small backyard looks like these.





Nice development house tiny yard, charge them 115 a month or something and include services like mowing, edging, blowing, weed control, hedge trimming, fertilizing, raking leaves. Comes out to about 20 visits a year (biweekly service march through october, 1/mo visits in winter months if requested) $115x12=$1380/20=$69(nice) dollars per visit.

Can you mow 10 of these lawns in a day? abso-F*cking-lutely. Before noon even. Maybe when the leaves fall in october you'll have to work a bit longer, oh well.

This is for biweekly work (every other week not twice a week), so you can fit 100 customers on a 2-week period doing 10 a day during the weekday.

That's $11,500 a month. We do slightly larger places on average since half are like this and half are a little bit bigger, so the average customer pays a little more, so each crew brings in $12,000 a month. So yes, the math checks out in the real world.

If you have 100 customers, you can section off your service area into 5 different sections. For example: northern properties on monday. Northeastern/eastern properties on tuesday, southwestern/southern properties wednesday, etc. Then, all your properties are close together. You put the names on a calendar like this. Note: this is before we had a full schedule for the second crew back when we were signing up people in the spring time.



As for planning routes, its up to the crew. They just get a list on their dispatching software and they choose the route. It takes only a minute to click and see where all the properties are. Since the properties are usually all close to each other the drive time between them is like 5-10 minutes on average. Makes for a quick day. We have a couple streets where there are 4-5 houses that are all our customers. They'll knock out 4-5 in a single hour.

So $12000 a crew minimum, paying them $20 an hour ($6400 a month). After other expenses (not much, just gas, fertilizer and fixing your cheap equipment) you should be taking home at least $5000 a month per crew.

And my guys work like 5 hours a day and I pay them for 8. So that's insane and everyone loves their jobs here. But if you actually worked them 8 hours I'm sure you could have 13 customers a day and $15000 a month in revenue. I think when we get a little bigger and start to spend some energy on optimization we could squeeze out a lot more from our employees and get to 7-8k in profit per crew at scale.

I don't know if this works anywhere else in the country, all I know is that it works extremely well here and we're going to keep adding employees and crews for the next couple years until we are at 10 crews or 1.8m in revenue or so. Then we are going to open up another location north of us along the puget sound I5 corridor.

 

[Johnny boy]

No one knows how to drive a trailer. I might be going back to a truck or a van. No much space in the prius.

I have multiple guys out working right now that are backing up and maneuvering full sized trucks with 14ft trailers around all day with 0 incidents *knock on wood* and it’s been that way for years.

 

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[Johnny boy]

Any business under $5M in annual revenues that's profitable should focus solely on increasing revenue, not increasing margins. The math is simple. The story left off with $300K in sales and 50% net operating profits. Doubling sales to $600K means $300K in net profits. $1M means $500K in net profits. It doesn't matter whether those numbers are 10-15% lower due to crappy workflows since you're still *WAY* ahead of implementing tweaks on the $300K business.

100%. Thank you.

And people ask "can you sustain that margin as you scale?"

yes...I just don't give a shit about squeezing the juice out of a tiny lemon yet, we can worry about that when we are doing 20 mil or something. That's when we can worry about getting employees to do a couple extra jobs, and negotiating the price of our dry erase pens. I have a strict policy of not tripping over dollars to pickup pennies. We have limited mental bandwidth, so our focus needs to be on important things.

I'd say we are operating with only mediocre to moderate efficiency. We could raise prices, our guys could do probably 20% more jobs, etc. But right now all we are doing is taking something that works and running more customers through it, and fixing what breaks.

Last time I checked our revenue this month, I was bummed out because I didn't see a ton of money coming in, I checked our software and we still have 25 people to put into the billing system! "Oh, that extra 4k/mo really helps". We are slightly outpacing our goal. If things keep going that way we will be forced to buy a 5th truck this year. Keep in mind we started this year with only 2. Very exciting. Should put us in a great spot to take the next step for next year.

 

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[ZCP]

4 people on here want franchises. let's go @Johnny boy
and yes, write the book and setup the course as a lead in to buy the franchise.

value for you and what you have created
value for them in they buy a money printing machine

 

[Johnny boy]

A truer statement has never been uttered.

Sometimes I just want to put both of them in a room and say "Susan here said you didn't trim her hedges", and then turn to Susan and say "Jacob says you're a liar". and just watch the show with some popcorn.

 

[Johnny boy]

Couldn't sleep last night so finally read the entire thread, very impressive work, you definitely hustle. I have a few questions if you don't mind...

How are you handling truck maintenance? (Send them to a shop, maintain/fix them yourself, etc) If you're looking for deals on used trucks do you have issues with them? I know how rough guys can be on equipment.

Also, when you got your SBA loan what did you use the money for? Did it help you scale how you thought and did you use the money the right way or would you have done something different looking back?

Once again, very happy for you and great job. It's a motivating story to read and cool to see people on the forum getting it done out there.

Trucks are as follows

2019 Silverado
2018 f150
2017 Tacoma
2020 ranger

Maintenance is just oil changes on the weekends. I’m taking the f150 in for one today actually. All part of a managers job. Each location will have a manager and they will be busy for 120 days with signups and hiring but the rest of the year they can easily find time for maintenance.

Finance every car. Why would I park 30k into something that sits and does nothing? I can spend $1000 on ads and get 55 leads, schedule appointments with 25 of them, signup 15 of them and add 28,800 in revenue for that year and take home 14,000 of that as profit. I don’t have savings, if it’s leftover it’s just more growth money.

I spent the money on ads and having extra employees to make sure we had no problem ramping up quickly.

 

[Johnny boy]

the way you describe it is really hilarious!

On the other hand, you hit a clear point, this really makes me wonder, how these uber-style companies (uber or other delivery type business empire) got the job done without hurting the brand. What did they execute on, that we can't figure out. Did they really hide the shit-show enough to exit? I really wonder, if it is the case for all these companies. If that's the case how did these investors not learn the lesson, I keep seeing these uber-style companies show up from nowhere from time to time. Maybe I am overthinking.

Because tech focused Silicon Valley is completely disconnected from reality and they live in a different world

Solipsism

After seeing it enough I’ve realized they all hang out with the same circle, they all go to the same DMT retreats, they all use the same buzzwords. They all live in the same bubble. The world is just like 50 different types of people copied and pasted again and again like the crowd of a 2000’s PlayStation game.

 

[Johnny boy]

I am building an app. Myself. One that will be for mobile and be on the app store and google play, and another on our website for desktop users. Same back end database so it's basically the same app just usable in different places.

It's already cool as F*ck.

All customers will be setup with it during their signup process as part of their onboarding. All current customers will login with their email address and phone number as password, and will get an email code for verification.

On the app there will be the ability to submit visit requests but in a controlled way with checkboxes and submitting optional photos, without any text boxes to harass our customer service with. They'll be able to see their upcoming visit dates for each property. They'll be able to get answers to all of our 50 most commonly asked questions or concerns. They can also cancel their contract by paying their 2-month early termination fee.

There will be no number to call or text, no email to contact, no person to chat with.

Vast majority of our customers don't take up much of our time and some people would prefer the 24/7 automatic ability to submit requests and review their agreements without calling or messaging us.

Some small minority of people are insanely annoying, which this will solve.

We will have one phone line for sales. It gets received by our answering service, and all current customers will be forwarded to a voicemail telling them "use the app or go to our website to manage your account or submit visit requests".

Only calls that will be taken by our employed office gal will be legit, new sales leads.

Will cut down on hassle by 50%. All requests will be created as tickets, tickets will pop up on her end in her version of the app. It will just be a list of them and it will have options for her to select from a list of responses and to mark them as done. The customer will see it on their app without any calls or texts, and it will go into our dispatching system for the employees.

Spent all night working on it. I'll probably spend a week on it to get it ready, maybe more.

 

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[Johnny boy]

We are just a short bit away from the following experience

1. You can get an instant quote and signup for it immediately. Automated bot with square footage calculations and everything.

2. You can call us and schedule an in person quote for free if you like talking to a person and meeting someone in a company polo and you can shake their hand

3. When you call for a quote, you get someone 24/7/365

4. Handle requests and manage your plan on an app.

The real value is that on top of all of this, you’ll have a consistent company show up on the regularly scheduled date, trained W2 employees with professional company equipment will show up, and it won’t be some subcontracted bums.

I’m doing all this myself and it’s how I spend a good chunk of my mid mornings or late nights on most days.

The thing is we are not offering services to millennials or college students only where they just want an app. We offer services to people who’ve never used a cell phone and it still works. The app is also sharing the database with our web app so you’ll be able to use our website to manage your account too. Or if you want to use the phone to call us it works just as smoothly. There’ll be a 20 something soft spoken polite female answering the phone and taking care of your requests.

All of this with as much automation as possible. The experience is smooth, leads are consolidated, the system doesn’t have gaping holes in it when we try to scale, it allows for flexibility for our business model to work the way we really need it to. And it’s easy to work with us, whether you’re a 73 year old grandma who hates cell phones, or you’re a developer at Facebook.

 

[Johnny boy]

Hey Johnny,

I am about to start flipping cars for another stream of income. How many cars per year do you sell?
Do you have a dealership license? Any tips and tricks for someone looking to do the same?

bro I worked as a car salesman at a dealership when I was like 21 this was 5 years ago.

 

[Johnny boy]

We also do it this way, the hardest thing is getting the colleagues aligned in this.

Some want to earn more others want to be able to quit on time.

A bit of puzzling to get the right crews together.
But this is indeed going to make you create more margin.

We’re moving to having them work alone.

They get a ton done.

Should push margins up to 53%

 

[Johnny boy]

I came to the same conclusion when I did the math, 1 crew trucks bring more profit per truck, but I decided against the 1 crew model because if one guy is out, who is going to take on his workload for the day. BUT It's actually the same issue on a 2 man crew, when one of the guys is out due to "illness" the other crew member can't always finish their full days route anyways.

Here’s what you do.

Every person you hire, you only hire people who are enthusiastic about taking any available overtime.

Now you have multiple people who are all happy to work the weekends.

Then, you can pack the schedule, if anyone’s gone, just send a late visit alert, move the jobs to tomorrow, have the guys catch up on the weekends.

Do not hire people with kids if you can avoid it.

Excuses non stop. Constant drama. “Hey my kid is sick”. Blah blah blah. Never can work on weekends.

It’s not just some of the time, it’s all the time.

If I’m in a lawsuit from some shitty employee in 5 years and they read this out to the courtroom…

We do not make hiring decisions based on age, race, sex, ethnicity, orientation, family status, etc. This supersedes any and all previous statements regarding our hiring policies and shall remain the primary statement of our company regarding our hiring practices from now thenceforth until a new official statement is made and labeled as such.

Guys working together always seem to ask for the jobs to be skipped. It’s like they get some confidence when working together. They look at each other and say “you think we should ask for the jobs to be pushed to tomorrow?” “Yeah bro F*ck it” “okay”

When they’re alone they just bust their a$$ and say nothing.

You want to compartmentalize people at least a bit.

 

[BlueMonday]

Man. I've read through this thread a few times now. What kind of props can I give that haven't already been said?

One thing that really stood out to me, among all the other diamonds in this thread, is that your ability to cut through the bullshit and solve problems is unmatched. You started this thing at a time when everyone (not on this forum, just the world at large) was convinced that the sky was falling. I don't recall you doing any macroeconomic navel gazing during what was one of the most demoralizing periods of our time. You stayed focused on your lane and killed it despite all of the noise out there. Much respect dude.

 

[Johnny boy]

Got it! Thanks for your input. I look at business as a game. I must know how it's played, the rules, the politics, and the competition. From there, I choose to play or not to play.

Ooohhh you sound like a mob boss. Badass. lol

Still following and lovin' this thread @Johnny boy !

I'm starting a new business and the goal is to franchise. This will involve doing business in states other than where I live. You do the same in your business. If you can say, did you register an LLC, then when you branched into other states, apply as a "foreign entity" in the states you expanded into? Or did you incorporate it? Or something else?

To answer your question specifically,

We have a corporation in Delaware as the franchise corporate entity.

It owns each location. Each location is its own LLC and is registered where it does business.

That way each company is “manager managed” by a private company in Delaware with no public info.

This is for privacy, compartmentalization, control, etc.

This is not necessary.

I just have a thing about doing things my way, which is probably unproductive.

You can just have a single entity, apply as a foreign entity in whichever state you want to operate in.

And then when you want to franchise you discuss the details with a franchise law firm and pay them $30k to help.

 

[El Príncipe]

@Johnny boy

It seems like you've really worked out the math and thought of everything. Thanks for giving me a good model to follow in that regard. Good luck on the business, keep us posted!

 

[momomaurice]

Look up a guy called Joshua Latimer and his automate grow sell website. On that website is a course on how to hire rockstar employees. It has certain ways of weeding out bad employees just by the ads you put up. Also read the E Myth.

 

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[Veloman]

I just posted a Craigslist ad and threw up a number of two months revenue. Assets were equipment, brand, customer accounts which were not under contract, web domain name. I had a lot of responses. Even with no employees. About 120 accounts, basic lawn mowing. Mow edge blow.
I met with the buyer a few times and worked a few hrs with me then decided to purchase. We filled in a generic purchase agreement which had payments in installments over 3 weeks that he and his helper worked with me.
We weren't too formal with it all. I had been doing it for 2 years.

 

[Johnny boy]

Also, I do my bids in person so if there’s any negotiation, it’s in person, not them shopping around for the best deal (just like car sales)

 

[Johnny boy]

Yes, I like doing all my bids in person too. Hopefully the lawns are no bigger than ours here in Texas for $30.

I never quote a lawn for $30 unless it’s the size of a closet and is less than a mile from my house. Neverevereverever.

 

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[ZCP]

systems, procedures, follow through ........ the key to your next stage of business..... keep chopping wood ....

 

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[Niptuck MD]

also since you are knowlegable in selling cars, i hope you research and find out the intricate details of lawn equipment (commercial equipment) whole different ballgame in terms of the second hand market. You will find some steals, i recommend government auctions or construction auctioneers they often have top of hte line equipment that need some mechanical work that you can grab at a steal

for example

Construction & Heavy Equipment Auctions, Truck Auctions | Used Construction & Heavy Equipment, Trucks for Sale | Martin & Martin

| Ritchie Bros. Auctioneers

Search Results | Ritchie Bros. Auctioneers

 

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[Johnny boy]

Update: Got a new lead man. Sent the guys out for their first job alone. Worked out great. They did a good job and finished on time.

Legal zoom is still keeping me from getting my documents back from the state. They gave me a $500 refund for the hassle. Total bullshit but I spoke with my insurance company and they said I’m still covered. Who knows...Likely a huge liability problem but it’s temporary.

I’m scheduling jobs for Thursday (one of my days “off”). That way they can work and I can go bid jobs and check in on them.

Now that I get a little bit of time to breathe I’ll use it to tie up the details and make the process more efficient.

I’m taking tomorrow off. Heading with a girl out to do some cliff jumping and light off some fireworks.

It’s funny that people say working as a car salesman is tough. No it isn’t. It’s about 40% as hard as what I’m doing in total.

So far, what would I have done differently?

I would’ve started in March/April so that loose ends are tied up by May/June.

I would’ve done the filing with the state myself.

That’s about all I would’ve changed.

I bid jobs at $60 an hour minimum and higher if I can get away with it. It’s working out well.

As we get rolling I’ll have to focus on redundancy so that we always can get the work done without hiccups.

My goal is to fill up my employees’ schedules ASAP.

Currently reading up on taxes. Looks like my business will be taxed as a pass through and I’ll pay taxes like it’s personal income.

Do I write off all expenses (labor/gas/etc..) and only pay taxes on profits? I must have dropped out of commmnity college before I took the business tax avoidance class.

Going to speak with an accountant this Thursday evening.

 

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