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Intro: How to Start a Lawncare Business a Whole New Way

Starting a landscaping business
I had 8 subcontractors who handle a variety of lawn & landscape tasks such as mulching, hedge trimming, loaming and seeding, hydro seeding, walkways, tree installation, chipping, lawn treatments and hopefully more and more as I become more comfortable and find more competent, reasonably priced contractors. My goal at the end of 3 years is that I personally help out in the spring and fall for a few hours doing the spring and fall cleanups, then do estimates and manage the rest of the year.

I made an average of $60 PER MAN PER HOUR which is nearly DOUBLE what most other contractors make in this area. In fact, I make an average of $70 per man hour on spring and fall cleanups and basic maintenance, AND my overall prices are either the same or only slightly higher than my competition. I increased my hourly rate from $25 to $60 in ONE WEEK, and it was the most life changing, liberating experience of my career!

Update: Retired now (2019), and using real estate investments to fund our lifestyle. I embarked on real estate investing in 2009 and ended up writing a book about rental real estate investing which you can read about, if you're interested, here. Real estate investing is a wonderful transition career, especially as you age, or want to start traveling. We ran our lawn care business, living off the wages it generated, while we put all the real estate profits back into those buildings. Once the rental properties were fully renovated and earning the same income as our lawn care business, we closed the lawn business and concentrated solely on our real estate holdings. The real estate business has it's own pros and cons, but it's very "absentee owner friendly". We have a team of maintenance people, plumbers, painters, a part-time on-call manager. A lawn care business on the other hand has clients ... hopefully very discerning, well-paying ones, and they like to see the owner's face once in a while. This makes a lawn care business, or ANY personal service business, a little more difficult to run "from the road."
Before you "Hang your Shingle" A man's got to know his limitations
Before beginning any business endeavor, it's a good idea to ask ourselves if we're "cut out" for it; can we survive-even thrive-under the pressure of self employment. And with the lawn care business comes a few unique pressures due to the seasonal nature of the work. We go from having little to do in February to having the phone ring off the hook in April, and people asking, "Where the hell are you?!" Shiny new equipment breaks down, just when you're getting caught up, and the day you've promised Mrs. Jones you'd get her lawn mowed for her big party on Saturday, it starts to rain for three days straight.

Maybe you should find one of those checklists that are designed to help you decide whether or not you're "cut out" for the rigors of self employment? I don't think those checklists are necessarily a good idea. I'm talking about the ones with questions that attempt to determine your temperament, or comfort level with risk, stress, etc. I would've answered "no" to nearly every question before I started my business and would've limited myself to working for someone else the rest of my life. They tend to paint a "worst case scenario" and can be very discouraging. Also, I think we tend to answer questions like those based on how we feel, or how we want to view ourselves. So look at them if you want, but take them with a grain of salt. Use them more to familiarize yourself with some of the unknowns of self-employment rather than letting them scare you from moving outside your comfort zone. Of course, if the question, "Do you like the outdoors," presents itself and you answer "no", you might just want to rethink your intention of getting into the lawn care business!

This section was absent in the first version of this book, because at the time I felt that people reading it would have already decided that they wanted to be in business. However, I changed my mind; I think it is my responsibility to point out that some of us are wired for self employment, while some are better suited as soldiers in someone else's army. What I'd like to point out is that one is not better than the other. Book after book will tell you how awesome it is to be self-employed-like it's a holy grail-while the rest of the world toils as sheep, living lives of quiet desperation. There is some truth to this statement. Many good people are in dead end jobs for reasons of security alone, indeed living lives of quiet desperation, waiting to have enough money, so they can do what they want and be happy. Many others, however, have great jobs, full of purpose, and perhaps value steadiness and security over the ups and downs of self-employment. There is no shame here. It does take a unique personality to thrive under self employment, but it does not take a better, stronger human being. Anyone can do it. It's all about discovering what's important to you and deciding whether you're going to have it or not.

That being said, here's a quick rundown on the pros and cons of being self-employed, some of the skills, traits and habits you'll need to have-or acquire-and some of my other observations on the matter. For the sake of usefulness, when I refer to being "self-employed," I am referring to owning and operating a lawn care business either solo or with one or two employees. There are thousands of other books that explore the advantages and disadvantages of "general" self-employment but there are as many differences between different types of self-employment as there are between being self-employed and having a job, so we'll limit our discussion to the green industry.
Time and schedule: When you're self employed, you will often times have to work more hours than someone who has a regular job-at least in the beginning. Of course, I am a testament to the fact that this state of affairs doesn't have to last forever! I used to work until 4-5 o'clock then do my paperwork until 6 or 7. Now I don't, but you'll hear more of my story later. An advantage to being self-employed, however, is that even with the added work load, you can dictate when you take time off. For some, this quality alone might be enough to persuade you to hang your own shingle, especially if you have children. There are soccer games, dance recitals, school picnics, parties and more. We bought a camper last year and go on 3-5 trips a year, sometimes up to a week long. We couldn't do this if I had a typical job.

Tax Breaks: With your own business, there are dozens of expenses that become tax deductions, reducing your taxable income dollar-for-dollar. Fuel, repairs, equipment depreciation, health insurance, labor-just about everything you spend money on in your business reduces the taxable income of the business. This is a huge money saver, and a huge help on your path to wealth. In my full program, I include an actual QuickBooks company file, all setup with typical deductions. You'll need to purchase the QuickBooks program for around $180 to make it work, but I strongly urge you to consider this program if you're at all computer savvy. I've found it very easy to learn and intuitive over the years. An alternative is the "Dome ledger." This is available in most office supply stores. It's basically a book keeping system in one "notebook" type setup, complete with pre-printed expenses to help you remember what's deductible and what's not.

Of course, with this advantage comes a disadvantage: You have to remember to pay your own taxes because there is no employer to withhold them from your paycheck. This is vital: Many small business owners have gone "belly up," fined thousands of dollars-and even faced jail time-simply because they got behind in their payroll tax withholding, either deliberately or accidentally. So with self-employment comes a ruthless need for financial discipline, which leads me to another disadvantage of being your own boss: Paperwork!
The paper monster: You'll need to either have a personality for paperwork, discipline yourself to acquire said personality-or rent someone else's! You'll need to keep an accurate time sheet for yourself as well as any crews you have. You'll need to enter this work, preferably each night, into your bookkeeping and billing system. Expenses will have to be recorded in a similar fashion. You'll need to be organized: the last thing you want to do is to start forgetting to record-and bill for-$40 and $50 mowings; this can add up to thousands of dollars over a few years. You'll need to create a budget each year, and check that budget against actual numbers each month to make sure you're on track. And if you're not on track, you'll need to be able to discern why-and then have the discipline to take action. Then there's paychecks, 941 payroll tax reports, withholding, estimated taxes, estimates, letters, and the list goes on. The paperwork can add up to a part time job if you're not working efficiently. This is why I dedicate an entire section of this book to streamlining the office. Keeping track is vitally important, and if you can do it in, say, an hour a day, then you'll be much more likely to stay on top of it than if you struggle until 9 pm every night.

The end of the rainbow: Let's face it: A very large reason we migrate to self-employment is the freedom that comes from becoming financially wealthy. Self-employment is one of the most common ways the average millionaire is created in this country and you can become one, too. It takes time, discipline and an unwavering desire, but it's attainable and you don't have to sell your soul to get there. I'm not going to devote an entire chapter to this, but let's take a look at a quick example of how much money can be made: Let's say you've been working now for 3 years. You mow 50 lawns and do a few installs, etc. You gross $120,000 and you have one part time helper. You pay yourself $17,000 and your profit is $5,000. Now as your business matures, you can go two ways: You can grow bigger, endure the growing pains, expand and take on a bigger salary and enjoy more profit. For instance, if you gross $500,000, there's no reason why you shouldn't be able to pay yourself $75,000 per year, and your profit might be another $25,000-$50,000. Gross a million bucks and you can double or even triple these numbers-at least the salary portion. The percentage of profit will jump up and down as you endure "growing pains" past each income level due to changes in efficiencies, overhead labor needs, etc. But if you're careful and conservative, you could be a millionaire in less than 15 years. This road will take work, but it's a road well suited for many.

Another way to become wealthy in this business is the slow, steady approach. I also pay myself approximately $50,000 per year, but our company only grosses around $150,000. How have I done this? In a nutshell, I expanded, hired a few people, lost a lot of work, then had to layoff all those people and just keep the most efficient ones: Myself and my one long-term employee. Because he and I were so much more efficient than the employees I'd laid off, our hourly rate doubled over night-without increasing prices! From there, our strategy has been to grow slowly, not by taking on debt or buying unnecessary equipment, and to use subcontractors-intelligently and strategically-and look for ways to save money on an ongoing basis. The unintended advantage here is that we get really, really good at being at a certain level before we move to the next level. We have 2 crews, two part time subs and a smattering of occasional subs. It's been this way for 3 years now. Next year, I'll bring on another sub and most likely I won't pick up a tool myself from June through November. Eventually I'll either sell the business to Troy, my long term trusted employee, or give him more money to manage it 100%. The point is, we get pretty comfortable with the current terrain before we explore new terrain. This gives us "firmer footing" going forward. I don't think either method-becoming huge or staying small and streamlined-is better than the other, but for myself, the latter approach is the only approach I could survive under. It fits my personality and I've worked hard to get there. You'll need to make a similar decision about who you are. My suggestion is to work very hard to identify your ego and its need for approval and grandeur, and make sure you don't allow that ego to make your decision for you.

Risk: Some will tell you that being self-employed is risky. You've probably heard that more than ninety percent of businesses fail within the first five years. While there's some truth here, keep in mind that with a regular job, one person-your boss, decides whether you stay or go. How's that for risk? With self-employment, you'll have perhaps 100 or more who make that decision. Sure, if you load up on debt and become sloppy with your work or record keeping, you'll be out of business and perhaps facing personal bankruptcy. But this "risk" is really mitigated and controlled by you. Risk is a tricky word and it's relative: don't ever believe generalities like "opening a business is risky." Most people will say that, and have an uncle or cousin they can tell you all about who quit a six figure job as an executive to open their own restaurant or other high risk endeavor only to lose everything they have. That was risky because they did risky things with a high probability of failure. It doesn't have to be this way if you get the help you need, move forward conservatively and take care of the paperwork. In the end, it's important that you "keep your own counsel." People who say limiting things like "opening a business is risky" are often just parroting things they've heard all their lives. It's in the same category as "I don't want to get into rental real estate because I don't want to get calls at three in the morning." Just a semi-believable phrase that most people will "buy" designed to keep them in their comfort zone and chained to mediocrity. This book will give you much of what you need to succeed. It's up to you to supply the drive and the dream.

So that's about all I have to say about being self-employed as it compares to having a "boss." Remember that a wise man keeps his own counsel. You and only you really know whether or not you're suited for it or not.

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