[agla]

I thought I'd throw this tought ought, since we have been picking up some more people new to having their own business.

Maybe we could take a poll as to how many employees people have and how much equipment they have.

I have observed a tendency that many newer landscape startups have in my area. I was guilty of this when I did it years ago. That is the belief that they feel like they are not legitimate unless they do everything and have the equipment to do everything. Or, that if they offered (fill in the blank) as a service it would bring in more money.

The only problem is they only have two or three employees that work a limited number of hours a week. How is it that so many landscapers keep buying more equipment, offer more services, and yet remain billing out only 200-300 hours a week or maybe less?

I think that in many cases the problem is that the desire to grow out weighs the ability to manage. It is not about having the skills to do the work, or training the crew, but the ability to manage people that many can not confront as their limiting factor.

Many do not max out, or even attempt to max out any segment of their business. How many mow two days a week, so they can do construction on the other three? Why do you not build up a full time mowing route to divide the overhead over more production hours? Why does all the hardscape equipment sit around on mowing days? Why do you have a hydroseeder that does less than 100 hours of work a year?

The reason is that you want to grow into doing all of these full time, but can't "right now". You hope to hire more people to fill these positions when you can. If you can get the work and have the equipment, why are you not filling in the weeks with work?

Everyone has a limiting factor. No one likes to view their weaknesses, but you have to deal with reality. More often than not that limitation is the ability to manage help. When you hit the point where you will not hire someone when there is no shortage of work, it is because you can not manage more people. Stop buying equipment. Stop looking for what else you can offer. Start streamlining your business into getting the most profit out of the amount of people you can manage.

Look at the smaller companies around you that have been successful for a long time. Do more of them limit their services or keep offering more and more? There is nothing wrong with being lean and mean. In fact it is the smartest thing you can do if you can't grow.

If you can manage a lot of people keep going, but take the time to see if you are capable of that.

If you are just starting out, consider maxing out your lawn crew as your #1 priority. Once you do that its overhead is cut way down and you have cash flow. Then start a second crew for other services. If you try to do it at the same time you are tying an anchor around your neck.

By the way, I know this only applies to others because it will be different for you.

[PSUscaper]

I think one of the problems I have buying equipment is that I don't necessarily buy for the reason of 'having it' or trying to 'expand' things.

The main reason I buy equipment is so I can improve the overall quaility of my work.

In order to do high quality work, I believe you need high quality tools, and also, need all right tools.

I hate to be on a job and not do something right for the sole reason I don't have the proper tool.

Sure, I could compact that driveway base with a regular old plate compactor........or, I could use a vibratory roller and really, really make it solid.

Also, I find that if you are trying to perform a task with the improper tool, it leads to a improper installation.

Maybe I don't have to have a laser........I could use string lines, line levels, etc.......but the laser gives you the accuracy and the security of knowing that the job is done 'exact'........I like that feeling.

I'm definitely guilgy of being 'tool lusty'. I think its a result of working for guys where half the shovels are broken, your cutting bricks with circular saw instead of a wet saw, your fixing a machine with duck tape instead of tools,,,,,,,etc. etc.

With all the other headaches going on in this business, I would rather not deal with the fact I only have a metric tool set and not a standard.........I just have them both. I just can't deal with that anymore.

steve

[Nebraska]

About a three weeks ago I ran into the operations manager of what I consider one of the most repected lawn and landscape co's in our town...
The operations manager is also the father of the owner. A number of years older than I and of course that many years exponentially wiser than I.

One thing that stuck out in my mind after our conversation is that he said that his son fails to understand is that with every new service that they offer while still not to full capability on all the previous services as the years go on, puts them a few years back because of the drain that occurs on the bottom line with that new venture.

I agree with what your saying Alga..

It's a common theme everywhere and in every business. I am looking at some land and was told about by another landscape co owner. He said that he would buy it but is frustrated that the bank would not lend him anymore money...all this while I'm sitting in a 98 Chevy with 140,000 miles loaded down with 2 tons of river rock and he's in his 2004 Duramax crew cab dually by himself.

With that said though how many of us learned the hard way that the right tools make life so much easier? I know I have. As we scrambled on Thursday to replace a waterpump in that truck due to the impending blizzard that as we find out today ended up being only a light dusting.

[site]

Good post AGLA... I wish I read it 8 years ago.

[jwholden]

When I started my business I wrote a business plan that I thought was logical. I look back now and laugh!

I thought I would find a foreman to use my excess capacity and run a mowing/maintenance crew (there's a shot of three of my trucks somewhere on the site, one of them was supposed to be a mowing truck and the other a landscaping truck).

I never found this guy and it is my fault - I'm very hands on and see jobs as being done my way or wrong. Every time I hired someone I thought would be around they gave 10 minutes notice and quit. I worked some very long days trying to make up for these people.

I have always 'feared' expansion because I don't want to make promises I can't keep. If your crew does not show up to work and you have to move a $4000 maple tree or finish fall cleanups for 30 people before thanksgiving day you are screwed. However, the right equipment can get me, to some extent, out of that bind.

I prefer to do tasks the easiest way possible if I know I will be doing them often. I have a 5 year old bobcat with under 1000 hours on it. That machine has saved my back and allowed me to pursue jobs that I wouldn't consider without it. I know I could always rent a machine, and often do, but a bobcat seems to me to be as necessary as a shovel for design install work.

I gave up the concept of a mowing crew and install crew this year and am sticking to design/install work. I figure that by getting out of the weekly service of mowing I can keep going on the installs every day. It has worked well for me so far.

I have a zero turn rider with less than 500 hours that I will keep to mow my 3/4 acre lawn. I love that machine and the fact I don't have to walk behind a mower for one hour every week.

I listen to my gut about whether I should get a tool or not, along with a detailed analysis of where the money is coming from and how I'm going to pay for it.

I often wrestle with myself if the goal of my business is to make as much money as humanly possible or to create a job I, and hopefully my employees, love and want to work at every day. The tools make it more enjoyable to me and I do not treat people like slaves or schleppers, we are in this together. I have a dream of employees that want to continue working with me for years, not getting burned out because I overworked them.

I have some lofty ideals.

[Stonehenge]

It is a really good post, as expected from Agla.

I had a big repsonse typed up, but it strayed a bit from the topic. Kinda.

As I read it, it looks like three-pronged advice for those shorter in the tooth. For the tool part of things, sure, I like to accumulate tools more than I should.

And I probably don't specialize as much as I oughta, but I have a couple reasons for that, and that may change for us in 3-5 years.

For the management part, I'm probably better than average, but the challenge that managing people presents is a large part of the fun for me. Sure, I want to make money like all the rest. But having an always-challenging job is equally important to me, and I get a lot of pleasure from testing myself, and trying to get the most out of people. I'm finally reaching a point where I have the luxury of doing more people development, and I love that propsect. I might totally bomb, but if I didn't take the risk, I'd be denying myself the chance to conquer myself, and my own shortcomings.

So I think the one thing his thoughtful post doesn't address, at least as it pertains to me, is how 'climbing the mountain because it's there' can also be a very valid part of building the business, in the face of poor odds and personal shortcomings. The journey to personal realization, I guess.

That's better. This version is much shorter.

[Paul]

I am probably the one Agla is talking about, I have more tools and equipment than most and he's right probably half sit in the shop some time during the week. Do I need two excavators? No not now, but I bought the last one for less than 1/3 the cost of a new one and paid for it's self on the first job it was on. We could have rented one for the same price that we bought that one for but I felt that having two made our company money. And again not many here have a 9 ton roller, but we need one for one job and have used it on many jobs but he's right it sits about 8 months a year. Our hydroseeder is used in the spring and fall very heavily but sits most of the summer, we see about 8 weeks of use out of it every year, so we get about 300 hours out of it a year, is that enough hours to justify the purchase? In my mind I think it is, we don't depend on others to schedule our jobs, and have less problems than if we subbed it out, this I know because we did that for 3 years before buying this unit.

One has to look more at saving labor $$ vs equipment costs. Labor cost are used one time and equipment lasts as long as it's maintained. If my men are faster with their tools than the next company who doesn't have them I know I'll make money!

One thing most don't know here is I have never gone in debit for equipment, the longest loan we have ever taken out on any equipment is 18 months, most is a direct purchase or in other words we paid cash for the equipment. I don't like my company to carry a heavy debt load. We never have and never will.

[Bill Schwab]

I think many newbies into our profession are like
I was..More equipment is better. I am the type who could have one of everything that was ever made weather I ever started it or not...

Now, we fit the tool for the job before we get the tool if you will, and any machine we need to buy that we cannot recover the cost for in 12 months, we simply rent and build that cost into each job we do. Space is very expensive here, a 1/2 acre yard with a building in a prime spot will run $13-15K a month. A one acre piece we are looking at to relocate our shop goes for over a 1 million...So, keeping the equipment down to what we use is crucial for our bottom line.

If I can talk my wife into going east to Valey Center, we can get property for much less, however, we then need to factor the hidden clause...Labor to get the equipment to and from our work would offset the cost of a higher piece of property in a New York minute....For this reason, I really miss the midwest... I miss southern Wisconsin, and Green Bay kicking butt at Packers stadium....But, i don't miss the freeze, and we will be working through and continually past the New Year..We run 12 months here....

Anyhow, I think what need be weighed is A) space vs rental and usage, B) how busy will you keep it, and C) how much can you write off? If yuo could deduct 100K for some peice opf equipment that the govt was going to take anyway, would it jot be well worth buying?

[agla]

The responses are interesting. The common link from all who responded is their ability to self analyze and self critique without being defensive to us, let alone themselves. That is why they are successful.

The bigger point that I am trying to make is that you can't operate simply on ego, imitation, and I belief that you can do it all without sound analysis of your needs and abilities.

I don't think it is wrong to have specialty tools like the vibratory roller. Where I think the mistake can be made is when someone is starting out with a couple of days worth of mowing, a planting job here, a paver job there, a seeding job here, and then starts buying specialty tools.

I guess that what I it comes down to is "form follows function". And in fairness, a lot of guys starting out have the primary function of getting enough work to fill in those days of the week. Two hundred mowing accounts don't just show up when you letter your truck. You really have to scramble to find ways to keep busy and survive. The danger is that it can become a habit.

If you get into the habit of doing a little of everything while trying to keep a mowing schedule, you start to scramble to get things done. The management of time takes over the management of money. Then you quickly buy this or that to get jobs done believing that you can do more paver jobs, or whatever. In the mean time you have become manager by reaction instead of being in control. That is the rut you get stuck in.

The main point is to make sure that you are managing the business and stearing it in the direction it needs to go. Buying tools to get you out of binds is a bad decision. The more you can fill your weeks in doing the same general thing, the more steady you go both in terms of cash flow and management. That is the slow and steady that wins the race. As things smooth out and the machine is well oiled, the sky is the limit.

[scl]

Paul Posted:

O!

One has to look more at saving labor $$ vs equipment costs. Labor cost are used one time and equipment lasts as long as it's maintained. If my men are faster with their tools than the next company who doesn't have them I know I'll make money!

One thing most don't know here is I have never gone in debit for equipment, the longest loan we have ever taken out on any equipment is 18 months, most is a direct purchase or in other words we paid cash for the equipment. I don't like my company to carry a heavy debt load. We never have and never will

I think this is right on the button! I would jave liked to have started right out with a new skid, new compactor, new tractor new truck....., but I bought what I could pay for and still do! Am I the perfect model, hell no! I sit on the fence way too much when it comes to the expansion thing and if I don't I have a biz partner (wife) who'll keep me in check.

I have bought a hydroseeder (used) and paid for it and it has paid for itself. If I could hydro full time I would but that market is not here. If I could lay pavers full time I would but that market is not here. Yes I like to buy equipment, but I don't like debt either.

The premise of this is great, the reality is its tailored to what makes sense due to your style, equip availability, labor availability etc... That said rental in my area is a joke. And I hate renting things like compactors, saws etc... cause they're never there when you want them.

As far as employees I don't like the idea of having people rely on me for their livlihood, but I've got to get over that. IThe work load is getting overwhelming and I ain't getting any younger! Good thought provoking post, all the responses have been good, and introspective

[jwholden]

Agla,

I knew there was a reason I liked you. You just hit two of my favorite sayings!!!

form follows function

slow and steady ... wins the race

I read Jeff say that he likes to have variety and a challenge in his work. I have this addiction as well. I love the challenge of new projects and solving problems, no matter how much it hurts my head and bottom line (to a degree).

One of the reasons I got out of lawn mowing was the tedium. There is something about taking a bad situation and making it great. I'm sure it's the same thrill you get at work.

Here's another qoute that I use almost daily at work,

"Tranquilo, eh!"