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How to Start a Lawn Care or Landscaping Business

February 1, 2008
URL: http://www.entrepreneur.com/article/190462

Editor's note: This article was excerpted from our Lawn Care/Landscaping start-up guide, available from the Entrepreneur Bookstore.

When you think back to the long, lazy summers of your youth, chances are some time was spent trudging along behind a lawn mower, pushing with all your might and sweating profusely, just so you could make a few bucks to buy some baseball cards or a really cool bike. You may have occasionally mowed down a few pansies or zebra-striped a lawn, but you sure were proud when the homeowner came to the door, surveyed your handiwork, and forked over the agreed-upon fee.

Mowing lawns or landscaping residential or commercial properties for a living will give you that same sense of pride-while earning you some pretty serious cash.

The Pros
There are many advantages to running a homebased lawn care or landscaping service. You're master of your own destiny, and you can devote as much or as little time to the business as you want. You have a short commute to work if you're based in your own community. You can work at your own pace and at virtually any time during regular daylight hours. You also can enjoy the fresh air, get a good cardiovascular workout, and bulk up your muscles.

The price of all this freedom and body contouring is relatively low-so low, in fact, that many new lawn service owners and landscapers use their personal credit cards or small personal loans to fund their new businesses. Once you invest in the tools and toys you need to manicure lawns or install landscaping professionally, you're generally set for years. You don't need much in the way of office equipment, either, and you can set your office up in a corner of the den or a spare bedroom rather than laying out extra cash for a commercial space.

Reality Check
This all sounds pretty appealing, doesn't it? But of course, every Garden of Eden has a serpent, and lawn care and landscaping businesses have quite a few of their own coiled up and waiting to strike. To begin, you have to be a lot more adept at mowing, trimming and pruning than the average person. That means you'll have to invest some time in learning gardening basics and techniques. You'll have to be a disciplined self-starter who can ignore the call of a glorious spring day and diligently service your clients rather than heading for the lake or golf course. You have to be physically fit and able to handle the rigors of the job, which can include lifting heavy equipment off and onto trailers, and wielding bulky handheld implements for hours at a time. You'll be handling potentially dangerous machinery and hazardous chemicals. And you'll have to be a very savvy business manager who can administer cash flow, invent advertising and marketing campaigns, and implement a survival plan that will take you through the lean winter months.

Industry Snapshot
According to the Professional Landcare Network (PLANET), an international association serving lawn care professionals, exterior maintenance contractors, installation/design/building professionals, and interiorscapers, there are an estimated 10,000 individual lawn care service providers and approximately 12,000 landscapers in the United States. These run the gamut from independent operations to franchises and divisions of large corporate chains. It's believed that the number of businesses could actually be significantly higher because there are so many people doing lawn and landscape maintenance informally and on a cash basis. What is known for sure, according to the Occupational Outlook Handbook, 2006-2007 (U.S. Department of Labor), is that almost 1 out of every 4 landscaping, groundskeeping, nursery, greenhouse and lawn service workers is self-employed and provides maintenance services directly to customers on a contract basis. Of these, about 1 out of every 6 works part time.

The market they serve is huge. A 2005 survey by Irrigation and Green Industry magazine concluded that the U.S. green industry, which includes lawn and landscape maintenance, landscape contractors, landscape architects, irrigation contractors, and lawn and landscape product suppliers, generates $67 billion to $69 billion annually. Additionally, PLANET estimates that the landscaping services sector alone generates 704,000 jobs and $35.6 million in value-added services annually.

Who Are the Customers?
Who's driving this industry? The 77 million aging baby boomers, many of whom are affluent homeowners. They recognize the value of a well-kept lawn and beautifully designed and landscaped yard, but they often don't have the time or the inclination to do the maintenance themselves.

Of course, baby boomers aren't the only ones whose fingers do the walking online or through the phone book to find a reputable lawn or landscape professional. Other potential customers include:

Landscaping:


Lawn maintenance:


Types of Green Industry Service Businesses
There are numerous ways to get into the lawn and landscaping industry. The basic types of lawn and landscaping businesses include:


Earnings
Exactly how much can you earn? The sky's truly the limit. The lawn care and landscaping business owners we interviewed for this book earned anywhere from $5,000 to $50,000 in their first year, and as much as $160,000 to $250,000 once they were in business a few years. They offer services ranging from basic mowing and trimming to landscape design, installation and maintenance, and chemical application
Lawn & Landscape magazine's 2005 State of the Industry Report offers additional insight into how much a lawn and landscaping company owner can earn. In a survey of Lawn & Landscape readers who own companies of all sizes, the average salary of the owner/president whose company revenues were less than $200,000 during 2005 was $31,273. Owners/presidents in companies with revenues above $200,000 earned $68,859 on average.

How to Start a Lawn Care or Landscaping Business

The Basics of the Lawn-Care Biz

As you know, lawn maintenance is a seasonal business, with downtime during the winter in about two-thirds of the country. Depending on your area and climate, the prime growing months run from about April to early October. You'll need to market your services aggressively in the spring so you'll have enough clients to carry you through the summer. Then, in the fall, you should be winterizing lawns, raking leaves and collecting past-due accounts. Still have energy left to spare? Then during the winter, you can offer services like snow plowing. If you decide to take a well-deserved break instead, you'll have to make sure in advance that you've budgeted wisely throughout the year and have sufficient funds to carry you through those income-free months.

The typical startup lawn care business services 20 to 30 residential clients a week and offers up to three types of services: mowing, fertilizing and chemical application. For the purpose of the lawn care part of this book, we'll focus on mowing and fertilizing, since chemical applications (herbicides, pesticides and fungicides) are a whole industry unto themselves. It's also a closely regulated industry that requires practitioners to earn certifications that permit them to handle these hazardous compounds.

Most lawn care service owners prefer to start out with basic mowing and add other services as they become more experienced and acquire more equipment.

Grass Attack
Basic lawn maintenance consists of mowing, edging and trimming. Often, bush and hedge trimming is offered as an extra service, but it's more time-consuming and requires more manual dexterity than mowing. Lawn businesses sometimes send out two people to a job site so one person can do the mowing while the other edges and trims the areas the mower can't reach. But if you're a one-man (or one-woman) band, you'll just have to allot extra time on each site to complete both jobs. Fortunately, not all lawns have to be edged every time you mow. Sometimes only minor touch-ups are necessary, which you can do using a hand edger.

It's crucial to the survival of your business to keep all your equipment in peak working condition. That means cleaning the mower blades at the end of each day and using a grinding wheel regularly to keep them sharp. You should also use a balancing weight to prolong engine life and to help prevent white finger, a form of Raynaud's disease caused by exposure to constant vibration from equipment like lawn mowers. Clean oil and air filters regularly to keep engine wear to a minimum and improve performance. The oil should also be changed often-as often as once a week, since the high heat of the mower causes lubricants to break down fast.

It goes without saying that you should take every precaution possible to protect yourself while working. Always wear safety goggles and ear protection, and always remember to let your mower cool down completely before you gas it up. Because the cutting blade can rotate at up to 200 miles per hour, never put your hand into the discharge chute or turn the mower over while the blade is spinning. In addition to the obvious injuries it can inflict, that razor-sharp blade can catapult projectiles like rocks, metal or even compacted grass that can do a body some serious damage.

Guesstimating Your Worth
Another important part of the job is providing estimates to prospective clients. Unfortunately, this is an inexact science, at best. Most of the owners we spoke with "guesstimate" how much time it will take them to mow a homeowner's property, then multiply that by a price per hour. The problem with this method is that land features like slopes and ornamental landscaping can affect the time. For example, let's say it will take you 70 minutes to mow a 10,000-square-foot property using a 22-inch mower. But toss in a backyard that's landscaped with driftwood and rocks and has a raised vegetable garden, and your estimate is no longer quite as accurate.

Experts recommend pricing based on lawn size. It's less arbitrary to set up a pricing structure this way, plus you'll seem more professional to your prospects if you have an established, formal price structure. You can compensate for unusual land features by building an extra amount-say, 10 percent-into your price.

Establishing Prices
Before you can make an estimate, you have to know how much to charge per square foot. Since the lawn care industry is so competitive, it's important not to overprice your services. The professional organizations and publications that serve the lawn care industry may be able to help, because many of them conduct annual member studies. In particular, you may find Lawn & Landscape magazine's State of the Industry Report, which appears in its October issue, to be particularly enlightening.

But you can also figure out how much the market will bear by calculating the size of your own lot and calling a few of the lawn care companies in the Yellow Pages for an estimate. (Typically, owners of lawn care services calculate their prices based on the total square footage of the lot. They can usually estimate roughly how much of a lot is landscaping.) Then recruit a few family members and friends to call for quotes on their lawns, too, so you can get a feel for prices on lots of different sizes. This will help you determine the acceptable price range in your community, and then it's easy to figure out where to price your services. This method works especially well if you're doing business in a community with uniformly platted subdivisions or other similarly sized lots.

Incidentally, while you don't want to be the most expensive service in town, you don't have to undercut the competition to get jobs, either. Pricing your services somewhere in the middle or toward the top of the range is a good rule of thumb. Then it's up to you to demonstrate that your professionalism, quality service and reliability set you apart from the competition and justify a higher price than the cheapest kid on the block.

The owners interviewed for this book charge anywhere from $20 to $85 per cut. Others charge a flat rate like $100 per month or $40 per hour. All of them base their estimates on a visual inspection of the property, and some measured the mowing area as described above.

Weathering the Storm(s)
Then there are weather issues to contend with. Even in the sunniest of climes, you are likely to have days when you can't mow or plant or prune-like when the winds reach hurricane speed or you notice your neighbor is building an ark. There's not much you can do when grass and landscaping are wet-except maybe catch up on paperwork, lust over equipment catalogs and read e-mail. That's why many green industry service providers choose to work a five-day workweek, leaving Saturdays (and Sundays, if necessary) unscheduled just in case the weather wreaks havoc with their work plans. Alternatively, you can work longer hours on a regular maintenance day to catch up-chances are people won't even blink if you're out merrily mowing or trimming as the sun is setting because it means they don't have to.

There's one more weather phenomenon you may actually welcome, at least in the northern tier of the country. Snow plowing can be a very lucrative mainstay for or sideline to add to your lawn or landscaping business. It doesn't cost much to launch a snow removal service-basically you need only a snow blade for your mower or truck and some extra advertising efforts. (Food for thought: Michigan landscaper Michael Collins, who runs Celtic Lawn & Landscape with Karen Deighton, reports that he gets 70 percent of his snow plowing business through his website.) Best of all, offering such a service means you'll have a regular income stream even during the slowest part of the year.

You also could get creative like Albert Towns Jr., a Detroit lawn care service provider who supplements his wintertime income both by putting up Christmas lights and by shoveling sidewalks for a number of elderly people. Then, in the spring, he does in-ground sprinkler system work to get his revenue stream off to a good start.

How to Start a Lawn Care or Landscaping Business

The Basics of Landscaping

Landscapers come in all shapes, sizes and backgrounds, but they all share one thing in common: a genuine love of the outdoors and growing things. It's what drives them to spend most of every day on the job covered in dirt. It induces them to learn the Latin names of plants, shrubs and trees-on purpose. And it makes them gleefully haul around 45-gallon containers (and the redwoods sprouting from them) like it's child's play rather than actual work. Sound like fun? Then you've come to the right place.

There are numerous ways you can forge a business in either residential or commercial landscaping-or both. Some of the fields require more than just a love of gardening to succeed-they also require experience and formal education. The major career paths for landscapers include:

Gardener/groundskeeper: This type of green industry professional is usually in charge of keeping up appearances-he or she may care for plants and other greenery, and may perform that work in a garden, greenhouse or work shed. What sets gardeners and groundskeepers apart from other landscape professionals is that they normally don't do any design work; rather, they tend existing landscapes, although they may render other services like applying pesticides and herbicides, mowing lawns, doing spring and fall cleanups, composting, etc. They need a good working knowledge of horticulture and plant varieties.

Interiorscaper (aka interior landscaper): You can build an entire business caring for plants in office buildings, shopping malls and other public places. Interior landscapers are usually contractors who provide general maintenance and care, as well as give advice about the types of plants and planters that will complement a building's interior design the best. Interiorscapers often give advice about plant selection, supervise and/or set up or tear down holiday decorations, and offer other services that are loosely related to interior design. While you don't need a design background to be successful, it helps if you have an eye for color, shape, texture and form and can translate that into green focal points that will complement beautifully arranged interiors.

Landscaper: In the most general sense, this is the type of person who installs and maintains plants, flowers, trees, sod, and other natural materials like rocks and mulch. Lawn care often is part of the landscape maintenance professional's menu of services, plus he or she may also offer basic design services (a good eye and an equally good design software package make it possible). Finally, landscapers may offer add-on services, such as sprinkler installation or hardscape construction, to stay busy. We'll discuss the numerous ways you can pump up your business a little later. Most states require landscapers to be licensed. Check with your state's department of licensing, labor or contracting board to find out the requirements.

Landscape architect/designer: Planning verdant spaces is the job of the landscape architect (aka landscape designer). Landscape architects often work side by side with building architects, surveyors and engineers to design and plan projects like new subdivisions, public parks, college campuses, shopping centers, golf courses and industrial parks, and then produce detailed drawings to pull the projects together. They may specialize in a certain type of project, such as waterfront development, site construction, or environmental remediation (e.g., preserving wetlands). Landscape architects also play an important role in historic landscape preservation and restoration.

Obviously, this is the most technically oriented of the landscape businesses mentioned here, and a bachelor's or master's degree in landscape architecture is usually required to enter the field. And as you may expect, licensed landscape architects charge the highest fees, which is why in May 2004 the middle 50 percent of landscape architects earned between $40,930 and $70,400, according to the Occupational Outlook Handbook, 2006-2007 edition. The highest 10 percent earned more than $90,850.

Of course, there are many other plant-related businesses that might be of interest to landscapers, including silviculturist (someone who specializes in the care of trees, especially relating to forests), horticulturist (a person who investigates better ways to grow, harvest and store fruits, vegetables and ornamental plants), and turf specialist (someone who cares for turf and sod). You can find an extensive list of horticulture and landscape design-related businesses on the Vocational Information Guide website at www.khake.com/page21.html.

General Business Operations
While you have many choices when customizing your new landscaping business, there are certain tasks that you'll need to do no matter which services you choose to offer. They include the following.

Estimating Jobs
Whether you're providing a simple service like pruning bushes or you're installing an elaborate three-level deck, people will want to know upfront how much a job will cost. As a result, it's imperative to develop good estimating skills right from the start. The trouble is, estimating is a science, and it's easy to make a misstep that could cost you plenty in terms of time and resources.

There are a number of software packages (like CLIP and LandPro) developed specifically for landscapers that you can use to help you make good estimates. We've also listed the names of a few books in the Appendix that you might find helpful. In the meantime, here is a general overview of how to go about making an educated guess.

Your mission here is to determine what your costs will be and then add in a profit. Your costs will include everything from materials (plants, mulch, topsoil, etc., which you have marked up from your wholesale or retail price) to labor (both your own employees and subcontractors), equipment (yours and any you rent), and your general business overhead (anything you plan to claim as the cost of doing business, such as home office expenses, gasoline, etc.).

Your estimate should outline the exact services you're offering, the materials you'll provide and anything else pertinent to the job. And by the way, your estimate should be provided free of charge, as that's the standard in the landscaping industry.

Setting Prices
Of course, before you can give an estimate, you have to come up with a price you can use as a baseline. Landscaping professionals recommend coming up with an hourly rate, both for yourself and your employees. But you won't be sharing that rate with your customers-it's for your eyes only, so you can figure out how much to charge for a job.

There are many ways to determine your rate. First, you can compare your prices to those of your competition. Enlist the help of friends and family to help you contact companies in your target market area that offer services similar to what you plan to offer. If you're doing business in an area that has a lot of subdivisions with similar-size homes and lots, the process will be relatively easy.

Another good way to determine your rate is to figure out how much it would cost you to, say, install sod (materials plus labor), and then divide that amount by the number of hours it would take you to complete the job. Add a profit margin, and you'll have a number you can use.

Finally, you can figure your rate based on how much money you'd like to make in a given year. For example, if your goal is to make $40,000 during your first year in business, you need to earn approximately $3,334 per month ($40,000 divided by 12). If you want to work 35 hours a week, a four-week month would be 140 hours a month. Divide $3,334 by 140 to arrive at a rate of $23.81 per hour. You can mark that cost up (or at least round it up), then add in your profit margin. Naturally, your cost of doing business, which includes materials, tool costs and office administration costs, would be billed to customers in addition to this hourly rate.

Of course, in the end it doesn't matter how you arrive at your rate as long as you make enough money to meet your monthly obligations. So when you figure out your rate, think about how much you need to pay the business bills and cover your personal expenses (including the mortgage, health insurance and other household bills). When you can pay all the bills and still have some cash left over to funnel back into the business or salt away in a business account, then you've priced your services appropriately.

A Day in the Life
While your reason for entering the landscaping field may be to get your hands dirty as you beautify America one home at a time, you'll have a lot of other duties you also must attend to as the owner of a newly minted small business. Some of the office tasks you'll handle during a typical workday include:

Office administration: Besides answering the phone and e-mail, you'll have mail to open and bills to send out and pay. If you decide to accept credit cards, you'll also have to process those credit cards through your merchant account. (You'll find information about merchant accounts in a later chapter.) It can take a substantial amount of time to do the books, says Livonia, Michigan, landscape business co-owner Karen Deighton. She spends about three hours a week keeping up with the financial side of the business-and she holds a degree in mathematics. If you're numerically challenged, you might want to hire an accountant.

Customer service: Tasks include fielding requests for estimates and scheduling appointments, both for estimates and actual jobs.

Purchasing: You'll need to buy supplies for the business, including office supplies, tools needed for the job, and chemicals like fertilizer.

Personnel management: Once you find you need employees, you'll have to spend time interviewing candidates, overseeing employees' work, making up work schedules, and refereeing when conflict arises.

Weather Woes
You know the old expression, "Into every life a little rain must fall." But when it comes to running a landscaping business, a little rain, a blizzard in April or an El Nino that stirs up a freak tornado can seriously hamper your business operations and put you behind schedule. Naturally, all you can do is wait out inclement weather and catch up on office administration tasks like billing and cold calling. On days when you find yourself gazing out a rain- or snow-spattered window instead of wielding a spade, devise a new schedule so you can catch up on the missed work as soon as possible. Never disappoint a customer-put in longer hours (as long as the light holds out) or work on weekends so you meet the demands of every job and the expectations of every customer in a timely manner. You could also make it a habit to overestimate the amount of time your jobs may take so you always have a little breathing room.

Incidentally, weather can impact your business in one more way. "Sometimes I have to tell customers when it's time to do certain jobs," says Collins of Celtic Lawn & Landscape. "For example, last fall I had a lot of customers who wanted their leaves raked. One kept putting off the job, so I encouraged him to do it sooner rather than later, because if I had waited until he wanted me to come out, there would have been 3 inches of snow on the ground."

Although many landscapers in northern climes choose to confine their business activities to the annual growing season and take a winter break, it is possible to run the business year-round by offering snow removal services. All it takes is a snow blade for your riding mower or truck and you'll be in business. Be sure to mention your snow removal services in all your promotional materials and on your website. It's also a good idea to do an extra mailing to your existing customers or to print fliers to remind people that you're just a phone call away.

How to Start a Lawn Care or Landscaping Business

Finding qualified help can be a real challenge. While mowing or planting doesn't necessarily take a great deal of technical skill, it is hard work, and it's work that's often done under uncomfortably warm conditions. It also takes a fair amount of physical stamina and the ability to handle power tools deftly without amputating useful body parts. So what on earth would make someone take on such a demanding job when he or she could sell designer shoes at the mall or call out mystery game numbers at the bowling alley?

M-O-N-E-Y, that's what. Which is why you'll have to do better than minimum wage if you want to attract qualified workers.

"Don't fall off your chair, but part of my success in hiring employees has come from paying way past the industry standard," says Nathan Bowers, owner of Premier Lawn Services in Sykesville, Maryland. "I pay laborers $11 to $14 an hour and my foreman $17 an hour. That may seem like a lot, but I've kept my employees [a long time]. That's pretty much unheard of in this business."

In case you did fall off your chair, remember that the trade-off for shelling out the big bucks is that, like Bowers, you won't have to spend a lot of time advertising, interviewing and hiring. But you don't necessarily have to pay that much to get the same excellent results. The Occupational Outlook Handbook 2006-07 (U.S. Department of Labor) reports that the median hourly wage for landscaping and groundskeeping laborers was $9.82, which you could round up to $10 or down to $9.50. If that's a little too high for your startup budget, you could instead offer at least $2 above minimum wage since it's hard to find unskilled jobs that pay that well.

However, according to industry experts and other business owners we spoke to, $10 an hour is about the going hourly rate for employees, which, compared to the current minimum wage, looks pretty darned good. Some owners, like Steve Mager, a lawn care business owner in Minnesota who also does chemical applications, have a sliding wage scale. Steve's base wage is $10, but he pays more-around $15 an hour-to workers with certain qualifications, such as those with a spotless driving record or a pesticide certification.

When you establish your base wage, keep in mind that in service industries like lawn care, it's not unusual for workers to change jobs to nab as little as a 25-cent-per-hour pay increase. So it's a good idea to ask around to see what other service providers are paying in your area and set your base pay rate accordingly.

"The truth is, both the lawn and landscape industries are starved for employees," says Tom Delaney, director of government affairs with PLANET, a Herndon, Virginia, association serving lawn care professionals, exterior maintenance contractors, installation/design/build professionals, and interiorscapers. "But the good news is, a mowing business needs fewer employees than other green businesses like landscaping. So your chances of finding enough people are not that bad."

How to Start a Lawn Care or Landscaping Business

Franchise Opportunities


Green Industry Websites

 

Lawn and Landscape Industry Trade Publications


Professional Lawn and Landscape Associations

How to Start a Lawn Care or Landscaping Business