Choose A Suitable Location For Your Business
When it comes to choosing a location for a lawn care and landscaping business, it is important to first and foremost look for a location where the average houses in the community has a garden or lawn. It will be out of place to locate your lawn care and landscape business in an area where you can hardly find houses with lawn or a location where there are no sport fields or golf course et al.
Another key factor that you should look for before choosing a location for your lawn care and landscaping business is the financial status of the residence in the location you want to start your lawn care and landscape business.
The truth is that, you will struggle to grow your landscape and lawn care business if you locate the business in an area filled with low income earners or in a ghetto or a place where people take it upon themselves to handle their lawn care services themselves.
If you localize your landscape and lawn care business close to a highbrow area or an area with loads of retirees, baby boomers and sporting facilities, you are likely going to make good returns from the business. When it comes to the facility to use for this type of business, you dont need to break the bank to source for money to rent or lease an office facility. As a matter of fact, you can start your lawn care and landscape business from your home.
Get The Required Business Insurance Licenses And Ein
There are a few necessary forms of business insurance you need to obtain to conduct business at all. The most important is general liability insurance, which covers everything from the cost of repairs to legal fees to damages that need to be paid out if you or an employee accidentally causes damage. Accidents like running over a sprinkler head with the mower, for example happen, and you want to be covered when they do.
You might also need workers’ compensation insurance, depending on what state youre operating in, though as Clayton puts it, Many states require both insurances to operate a legitimate business regardless of whether you have employees or not. Workers’ comp covers you in the event an employee is injured on the job, from medical expenses to court costs.
Other forms of insurance that arent required, but may come in handy, include inland marine insurance , commercial auto insurance and commercial umbrella insurance .
Additionally, if youre looking to apply pesticides as part of your services, most states have a pesticide charter that needs to be acquired. Clayton calls this a very involved process and doesnt recommend it until youre well-established in your field.
Before you start operating your business, make sure you also have any business licenses you need for the state you’re operating in and that you’ve registered to pay taxes and received your employer identification number, also called a business tax ID number.
Advertising Marketing & Public Relations
Technically, marketing should start right from the beginning. What you need to learn is how to market your lawn service business. Informing the public about your business services can help you in building a solid customer base. Also, flyers and posters can help in grabbing the attention of pedestrians. You can paint the trailer with the logo and contact number of your business.
***BONUS TIP***After a few months of establishing your business, you can run digital paid ads in your nearby locality.
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Obtain Required Licenses And Permits
Many businesses will need a business license to operate. Licensing informationâas well as any zoning requirements or other permitsâcan usually be found on the city or county website.
Lawn care businesses sometimes need to obtain specific licenses landscaping businesses often do. The specifics vary by state and municipality, but in most cases, if you are strictly offering lawn care services , you wonât need a license. However, if you will be altering the terrain chances go up that youâll need a license. Sometimes, you must take an exam ahead of licensure, too. Make sure to check at both the state and local level, as some states might not have licensing requirements, but municipalities within that state may.
Most states, even if they donât require lawn care or landscaping licensing, do require a license before you can offer chemical or pesticide application. In many cases, you must pass an exam prior to receiving this license, so make sure you study up and plan ahead.
How Much Can You Earn From A Lawn Care Business
Lawn care business owners earn anywhere from $10,000 to $50,000 in their first couple of years and up to $150,000 or more after a few years in operation. Profit margins are usually around 50-60%, as ongoing costs tend to be low. However, as a lawn care business expands, adding new machinery, workers, and vehicles, margins can fall below 20%.
Service pricing varies, mainly depending on lawn size. Per-session lawn care services often cost between $30 and $100. If your business charges an average of $65 per session and mows 30 lawns each week, youd see $97,500 in annual revenue and nearly $49,000 in profit, assuming a 50% margin.
Ultimately, your earnings depend on the number of homes you can service, which will in turn depend on whether you operate on your own or with a team. Of course, the more people you hire and more equipment you purchase, the higher your revenues, but the lower your profit margin.
If each lawn takes about 2 hours on average to complete, then a two-person team could complete about 3-5 lawns per day, 18 to 30 lawns per week, and 72 to 120 per month. At an average price of $65 per mow, this would amount to $56,000 to $94,000 in annual revenues.
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How To Hire Employees How Many Do You Need How Do You Make Them Reliable
Hiring employees is the biggest obstacle to growing a landscaping business. The work is hard and grueling. Finding reliable labor is challenging and costly. When you do get helpers, treat them with respect, pay them well, and have their best interests at heart. This is best way to get and keep good help. If you really care about them, they will care about your business and your customers.
To monitor your employees, check on their work routinely. However, mainly try to hire people that just love making a lawn look beautiful. Get the right people on board. If they are the wrong people cut them, its not fair to the right people.
Here Are A Few Pieces Of Equipment You Should Definitely Have:
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Catcher mower 21 inch
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Mulcher mower 21 inch or Side delivery
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Line Trimmer Straight arm loop handle 25 cc + plug in tools are handy like hedge trimmer Stihl
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Petrol Blower vac
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Collection rate
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Internet banking
This is something I could go into great deal about, but for the sake of this article I’ll keep it short. Set out how you do payments within the first or second meeting with the client – that sends a message to them that you’re organised, and they will need to fall in line. If you can’t communicate this from the start, your clients will likely be lazy too. It’s far easier to set a standard then try to recoup the costs from customers who don’t pay routinely.
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Financing A Lawn Care Business
Getting the necessary tools and training to start a lawn care business can be an investment. Since the majority of individuals dont have such large sums of money readily available, many choose to apply for small business financing. Good funding options for lawn care or landscaping companies include:
- Equipment leasing. With so much high-value equipment needed to start a lawn care business, equipment leasing can be a great solution. Rather than buying equipment outright and paying a large sum upfront, this option gives you access to the equipment you need by paying a monthly fee thats a fraction of the cost.
- Small business loans. The most common type of business loans is offered by the Small Business Administration. These loans boast low interest rates and long repayment terms, making them ideal for business owners, and theyre also guaranteed by the federal government, meaning banks will be repaid up to 85 percent of the loan even if it defaults.
- 401 business financing. Once a little-known method of business financing, this method is becoming more popular. It allows business owners to use funds from their 401, IRA, or other pre-tax retirement plan to start or buy a business without incurring tax penalties.
- Unsecured loans. Similar to a credit card, this option allows business owners to borrow money and repay at will, without needing to put up any personal property as collateral.
How Much Do Lawn Care Businesses Make
How much you make depends on how much work youre willing to do.
Some lawn care business owners make $10,000 a year while others make $100,000. It all depends on your team size, efficiency, the services you offer, and your profit margins.
Phil Sarros, Director of Education at Steel Toe University
40% is the ideal profit margin, says Phil Sarros.
Im not saying every job you do is going to have a 40% profit margin. But, once you understand bidding and estimating, targeting specific clientele, and putting out proposals at 40% margins, youre going to have the flexibility to negotiate with new clients.
Start small and grow strategically
Having a 40% profit margin and earning 100k a year may sound nice right now, but its a tough journey to get there.
Starting off by pricing low is usually the only way to get your foot in the door.
But after a few months of hustling and saving your money, you could invest, say, $60 in a herbicide sprayer. In a year, you might decide to spend $200 on a commercial-grade trimmer.
At this point, you can offer weeding and trimming as services. Little by little, investing in better equipment will help you expand your services to things like pest control, tree care, and even landscaping.
That gives you the leeway to charge moreand profit moreon every job.
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Whats It Really Like To Work In A Lawn Care Business
Working in a lawn care business means spending the bulk of your time outside doing manual labor. But, as the business owner, a lot of your time will be spent networking and marketing, too. As your business grows roots, more and more of your clients will become repeat customers, and youâll be able to spend less time searching for work and more time doing the outside work you love.
Find A Business Mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
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Cons For A Lawn Business
There are a few issues that you’ll need to consider while planning your business.
- Seasonal: Unless you live in an area where winters arent bad, your customer accounts go into hibernation by mid-October. If you are looking for a year-round business, you will need to find something to diversify your product offering to keep business up and running through the winter.
- Start-Up Expenses: Depending on the type of lawn care business you decide to build out, you will need equipment and something to transport this equipment with. This may require upfront cash and in some cases, a sizable amount.
- Competitive: Open your phone book and you will find a number of lawn care businesses in your area. If the market is too oversaturated, you will find the need to compete on price and this will cut into your gross margins. Research your area and if possible speak to existing lawn care companies about what they are experiencing in your area.
- Some Economic Risk: When economic times get tough, existing residential customers may find the need to cut non-essential expenses, and for many, outsourced lawn care is one of those.
How Money Can Kill Your Lawn Care Business
You shouldnt buy a 16-year-old kid an expensive car because theyre an inexperienced driver. Likewise, you shouldnt blindly pour loads of cash into your new lawn care business without some experience.
Think of a brand new business owner like an acne-faced teenager, angling for his dads keys. That new influx of cash into your business is a big responsibility.
Youre a new lawn care business owner with a lot to learn, and thats fine. Thats where everybody starts.
Dont give yourself too much to handle at once. Start out small and gradual, so you can take baby steps as you grow into a more experienced lawn care business owner.
Set aside a little money from your paycheck, buy an affordable lawn mower, and get started. You dont need big money and fancy lawn care equipment to get started. Start out solo with a few 2-3 lawn care services you can get really great at, and then work from there.
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The Economic Conditions Make Lawns A Low Priority
When hard times hit, both residential and business customers are likely to review all costs. In these times, it is inevitable that some customers will prune what they consider to be non-essential expenses.
For some, lawn maintenance will be one such cost. Owners of successful lawn, landscaping, and garden care businesses experience the freedom and joy of working outdoors while having the opportunity to leverage their business into significant income streams.
Schedule Some Office Time
Your first few months will involve a lot of administrative work. Its an important step in starting your own business and if you spend a little more time on these tasks in the beginning, it can mean a lot less stress later on.
Your first step is to register as a lawn care business. Visit the Small Business Administration website for information about how to do this, or check the online resources for your town office or city hall.
Make time to sort out taxes, invoicing, and a few other items. To be a first-rate lawn care professional, youll need to do most of the following:
- Register as a business
- Set up a bookkeeping system
- Organize and file receipts for business purchases
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Get The Right Tools And Equipment
We just talked about how important it is to protect your tools and equipment with the right business insurance coverage.
Now lets chat about what tools and equipment youll actually need to start your lawn care business. Keep in mind that this isnt a definitive list rather, its meant to help give you an idea of what you absolutely need right out the gate as a landscape contractor:
A mower and edger
Youll use your mower every day so do yourself a favor and start with a self-propelled one instead of a basic push mower. You can get a well-made entry-level model for around $400.
If you want to get a little fancier, look into a zero-turn deck mower, starting at around $3,000. Thats a major purchase, so unless youre doing big lawns right off the bat, you might want to hold off.
And dont forget an edger to make your lawns look really sharp. Expect to spend around $160 for a high-quality model.
String trimmer
With string trimmers, you tend to get what you pay for. So, while you could spend as little as $40 for a new trimmer, it probably wont stand up to commercial use and youll just end up buying another one later. Top models cost around $400, but you can get a very good gas trimmer for around $175-$200.
Leaf blower
As with string trimmers, leaf blowers can be bought very cheaply but those wont stand up to commercial use. A gas-powered backpack leaf blower from a reputable company will cost around $190 or so.
Truck and trailer
Safety gear and other equipment
Step : Plan Your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
Luckily we have done a lot of this research for you.
What are the costs involved in opening a lawn care business?
The costs include obtaining a simple business license, equipment, supplies, promotional signage, flyers, business cards, a website, Internet connection, and having a pickup truck .You can have very modest liability insurance for this business however, you will need to pay for workers compensation insurance if you hire employees.A typical start-up budget for an owner/operator business with no assistants is under $3,000 and consists of:
- Mower – $500
- Oil and Gasoline – $20 per tank needed.
- Promotional Signage – $100 for magnetic signs
- Flyers – $50
- Website Creation Free to $500
- Internet Services – $50 to $75 per month
- Insurance $50 to $200 per month
- Pickup Truck Lease – Nothing down with good credit, $299 per month plus $100 per month for insurance
Read our lawn care business purchasing guide to learn about the materials and equipment you’ll need to start a lawn care business, how much to budget, and where to make purchases.
What are the ongoing expenses for a lawn care business?
The ongoing expenses include labor cost, truck and equipment maintenance, and operating expenses. A typical monthly expense budget for a small operation with a home-based office would be:
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