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Lawn care is a service that requires extensive knowledge and skill. It’s not easy to start your own lawn care business, but it can be profitable if you know what you’re doing. This guide will give some tips for those looking to get into the industry as well as share how to find work in this field
Starting a lawn care business is not easy. There are many things to consider before jumping into the industry.
Mowing, edging, weed eating, and blowing are all services provided by a lawn care company. Understanding the expenses of starting a lawn care company includes equipment, business permits, insurance, and, depending on your state, a mowing license. With a successful lawn care company, you may earn approximately $60,000 per year.
Every lawn care business must register as a legal entity. This safeguards the owner’s personal assets in the event that the company is sued.
In five easy steps, learn how to establish a lawn care company.
1. Create a business plan
A lawn care business plan may help you figure out who your target market is, how much equipment costs, and how much money you intend to make and spend in your first three years of operation. There is no lack of consumers for a lawn care service, but you must know how to approach them and separate yourself from your rivals. After you add in equipment beginning costs, your financial predictions indicate how long it will take for your firm to become profitable.
Business Plans: Traditional vs. Modern
Before you start writing your lawn care business plan, you must decide whether you want to write a classic or contemporary strategy. A conventional business plan is comparable to a financial report and is required when applying for a bank loan. Many company owners who aren’t receiving a bank loan and want to construct a more streamlined, visual business plan choose a contemporary plan, such as a business model canvas (BMC).
In less than 30 minutes, you may complete the main elements of a BMC business plan.
Conduct Market Research
In the market research portion of your business plan, you’ll describe who your ideal consumer is and how many you’ll need to stay in business. You have a lot of prospective clients as the owner of a lawn care company. “What communities are underserved?” is the key question your market research should address.
Personal research is the greatest approach to answer this issue. Take a drive around the neighborhood to identify which areas have neglected grass. You may also look into which lawn service firms cover certain areas. Then, using Google reviews, determine which firms have the lowest average rating. Because some clients are sure to be unsatisfied with their service, marketing your lawn business in the communities where your lowest-rated competition services is a smart idea.
Find out costs
Even if you’ll be buying lawn care equipment once you’ve saved up enough money, it’s still a good idea to do some research on prices. You’ll include the price of lawn care equipment in the financial forecasts we’ll go through later. You’ll also factor in the expenses when calculating the amount of money you’ll need to start your firm.
The most important issue to answer concerning equipment is whether to buy it new or secondhand. If this is your first company, you should keep your initial expenses low by buying secondhand equipment from local retailers or on Craigslist or Equipment Trader. You may improve your mowing equipment if your firm is profitable.
Conduct a Competitive Analysis
The competitive analysis area of your business plan is where you record the strengths and weaknesses of your competition. Because you may concentrate on delivering a service or feature that a rival does not, this knowledge can assist you to come up with marketing concepts. It might be a service such as sod installation or a company feature such as a money-back guarantee, for example.
Investigate your top five lawn care rivals to do a competitive analysis. Make a list of each company’s advantages and disadvantages. What do those companies excel at, and where might they improve? For competition research, the marketing department of a firm is your best source of information. Examine their print and internet marketing by visiting their website and checking out their Google My Business page.
“When starting a business, it’s critical to plan ahead and understand the actions you’ll need to follow to make it a success. Because a healthy bottom line is crucial, become an expert at comprehending your profit and loss accounts so you can optimize your profits.”
Founder of Conserva, Russ Jundt
Financial Forecasts
The financial forecast element of a business plan is the most complex. It’s where you keep track of your starting expenditures and how much money you’ll need to get your company off the ground. When estimating how much money you’ll make each month for the first two years of your firm, keep these expenditures in mind. You’ll also need to include a paragraph that displays a high-level picture of revenue and spending for the first three years in a year-by-year style.
It’s a beginning expense, for example, if you take out a loan to buy lawn equipment. You must account for the loan repayment as a monthly financial expenditure until it is paid off. It might take months or years to recoup your beginning expenditures. Additionally, by deducting the cost of equipment from your company tax returns, you may save money on taxes.
If you’re looking for money from a bank or an investor, you’ll need to complete your financial estimates. They usually look at the first portion of a business plan because they want to know how and when they will recoup their investment. Additionally, after the firm is up and running, you’ll utilize your estimates to see whether you’re on track to accomplish your financial objectives.
Software to Create a Business Plan
You may realize that creating a business strategy from the beginning is a daunting task. There is software that will guide you through the procedure step by step. Live Plan is a business plan program that displays each area you need to complete as well as other information to help you understand how to do so. Live Plan also makes aesthetically attractive charts using the financial forecasts information you input. Use these graphs to better assess your lawn care company’s future development.
You may learn from a lawn care business plan sample on Live Plan. A typical business plan, for example, might be used to get capital from a bank or an investor. Its hypothetical lawn-care business takes $16,000 in initial fees and doesn’t break even until the ninth month.
In year three of LivePlan’s lawn care business plan example, the company makes a profit of $16,000.
2. Raise Money for Your Lawn Care Company
You’ll be ready to seek finance after you’ve completed your lawn care business plan. If you need a large loan, such as $75,000 or more, you will most likely begin your quest for finance with a bank. You may also seek an investor or launch a crowdfunding campaign if you have a strong network in your neighborhood. You may take out a smaller loan, such as a personal loan for less than $50,000, or you can use credit cards to fund items like lawn care equipment.
Obtain a Bank Loan
A bank will usually lend at least $75,000 to a small firm. If you’re buying higher-end equipment like trucks, trailers, or commercial mowers, you could require a loan of this magnitude. Additionally, if you’re recruiting numerous people, you’ll need enough money to pay their first month’s wages.
If your business is new, the bank will need you to keep the cash in a separate account, such as a certificate of deposit (CD). This is due to the bank’s desire to recoup its loan if your company fails.
Personal loan
If you need less than $75,000 in cash or don’t have enough money to put up as collateral for a company loan, you can consider a personal loan. Personal loans are usually dependent on your credit score, but they may also be used for business. A credit card may also be used to get a personal loan. For purchases under $10,000, most business owners utilize credit cards. A loan secured by an asset, such as a CD account, has a higher interest rate than a personal loan or credit card.
Locate an Investor
An investor is a person or a group of individuals who gives you money in exchange for a portion of your lawn care company’s equity (ownership stake). People seek investors in order to avoid taking on debt. Furthermore, unlike a bank loan, you would not owe an investor any money if the firm failed.
Finding an investor in your town might be difficult. Creating a business plan with precise financial predictions and networking within the business community, such as joining your local chamber of commerce, are the best ways to find an investor.
Using Crowdfunding
Crowdfunding is a method of raising funds for your lawn care business by giving prizes in exchange for services that are paid in advance. If you have a network of prospective clients who are prepared to pay for your services in advance, a crowdfunding campaign for a local company may be effective. As an incentive, you may give homeowners a discount if they pay for many months or a year’s worth of lawn care in advance. The funds generated might then be used to purchase lawn equipment.
For utilizing their platform, a crowdfunding campaign would typically charge a 5% fee on all earnings. The platform will give a website landing page, a messaging system for campaign updates, and platform advertising in return for a charge.
3. Prepare Legal Documents for Your Lawn Service
You’ve utilized your business plan to collect the required funds to start your lawn care firm by the time you’re ready to submit legal paperwork. To prevent legal issues and tax ramifications, you must provide documents before taking on any new clients. If your company is sued, filing as a legal entity safeguards your personal assets. If an employee is harmed on the job or a customer’s property is damaged, liability insurance covers the company.
Create a legal entity
Filing as a legal corporation creates a distinct business entity that protects and separates your personal assets. If your company is sued, having it set up as a distinct legal entity protects your personal assets. Aside from litigation, when you register as a legal company organization, your personal assets are safeguarded from any business obligations.
Approximately 80% of small companies form a limited liability company (LLC), which is a legal structure that shields its members from the debts and litigation of the firm. You may wish to register as a company, such as an S Corporation, depending on your business and tax structure requirements. Incfile is an online legal tool that may help you establish the legal entity for your lawn care company. For just $49 plus your state charge, you can register your company with Incfile today.
Get your EIN (Employee Identification Number)
Your EIN is a number issued by the Internal Revenue Service (IRS) to companies for the purpose of monitoring federal income taxes and employee payroll taxes. Applying for an EIN with the IRS is completely free. To create a company checking account, the EIN is usually necessary.
Obtain a Business License
To run a lawn care business that includes mowing and basic lawn upkeep, you usually don’t require a license. Several jurisdictions, like California and Alabama, do, however, need a lawn maintenance license. If you’re applying chemicals to your lawn, such as insecticides, your state will almost certainly need a license. It’s a good idea to check your state’s and county’s official websites for lawn maintenance business licensing requirements, regardless of the services your lawn care firm offers.
Obtain Liability Insurance
To protect yourself in the event of an employee accident or property damage, get liability insurance for your lawn care service. For example, if your mower causes significant damage to a commercial property’s irrigation system, your company might be held accountable. Liability insurance is required in some places, including Louisiana and California, to run a landscaping firm. Liability insurance for a lawn care business typically costs approximately $400 per year.
Open a checking account
Before your lawn company incurs expenditures, you should create a business checking account. In the case of a tax audit, it’s best to keep your company and personal money separate. With a minimum balance of $1,500, Chase Company Checking delivers secure and trustworthy checking for small business owners.
4. Establish lawn-care-related business systems
You may set up company procedures, such as recruiting processes, and acquire suitable software after you’ve finalized your legal paperwork and created a business checking account. Payroll software is required if you have workers. Accounting software is required by all firms. It aids in the tracking of income and spending. Customer relationship management (CRM) software helps you to keep track of your sales prospects and communicate with your clients.
“How will you manage your everyday schedule?” Do you do your accounting on a daily basis? How will you keep track of the equipment’s upkeep? These are just a few of the dozens of different small systems you’ll need to include in your everyday life in order to manage and develop your lawn care company. The good news is that each of them has amazing internet solutions.”
Zach Hendrix, GreenPal Co-Founder
Recruit Employees
Many lawn care firms start off with only the owner as an employee. Other lawn care organizations begin with a few staff who conduct various grass upkeep jobs. You may advertise available jobs on job posting services like Craigslist or Indeed if you’re looking for new hires. Before employing someone, you should do a background check.
Using your website and social media to recruit staff is one of the most effective methods. Add your lawn care job description to a “Jobs” page on your website. Take that page and share it with your followers on social media. Sharing a job opportunity on Facebook is also a terrific method to promote your company without having to actively advertise to your personal connections.
Employees
You must pay your staff after they begin working for your lawn care company. In the event of a tax audit, it’s critical to keep track of your company’s payroll records.
Accounting and Billing Software
Tracking revenue and spending is an important part of running a company. QuickBooks is an online accounting program that aids in the management of your company’s finances. You may also send invoices to your customers using QuickBooks software. You may offer your clients the option of signing up for recurring monthly payments when you send invoices online. This cuts down on the amount of time you have to spend collecting on bills issued to clients each month.
CRM for Lawn Care
CRM software aids in the management of leads and customers for your lawn care firm. It’s critical to maintain track of the consumers with whom you engage with your lawn care services. To attract consumers to sign up for extra lawn care, you could want to arrange follow-ups with them or send them coupons. Maintaining communication with your consumers is also necessary to guarantee that they are getting acceptable service.
With greater customer communication, use a CRM to set yourself apart from other lawn care competition. Send a card to your consumers wishing them a happy birthday, along with a discount. Using a CRM to automate this procedure will save you time. Without a CRM, it’s tough to set up birthday reminders and send out cards to dozens or hundreds of consumers.
HubSpot CRM is a simple and free CRM software. HubSpot offers free CRM software in the hopes that you would subscribe to its additional commercial services, such as marketing tools.
“Take time away from working ‘in’ the company to work ‘on’ the business,” says one entrepreneur (commit X hours per week). Identify the obstacles that are holding you back and attempt to remove them. It’s easy to create excuses to return to the field, but as a business owner, you should realize that your time is better spent operating your company.”
Butch Dellis, Nutri-Green Professional Lawn Services Co-Founder
5. Promote Your Lawn Care Company
Face-to-face contact is the most effective technique to sell your lawn care service. Customers want to meet the person who looks after their lawn. Referrals are also a wonderful way to promote your lawn care business. Traditional marketing materials such as business cards, pamphlets, and thank you letters help present and future consumers remember your company. In addition, prospective clients seek for your company on the internet. Before committing, they want to examine the quality of your work and check internet reviews.
Traditional Marketing
The tangible resources you’ll need to advertise your lawn care firm are included in traditional marketing. Print business cards, flyers, posters, and small signs using a provider like Vistaprint.
Writing handwritten thank you letters to all first-time customers is a tactic you may use to acquire long-term clients. This is a kind touch that your client will appreciate. The thank you card is also a terrific marketing item that your consumer may pass on to their neighbor.
Lush, a lawn care firm, employs a one-of-a-kind business card to stand out to prospective clients.
Customer Networking
If you want to attract commercial landscaping customers, you’ll need to network. Joining your local Chamber of Commerce or Business Networking International (BNI) club and attending meetings helps prospective clients put a face to a company. To obtain recommendations, you may also wish to network with other residential-based service firms, such as pressure washers and pesticide providers. Property managers are also a good group to network with since they could refer your company to their tenants.
“Within a few weeks of establishing a lawn mowing business, I was completely booked.” It was all down to one networking strategy that my father used to assist me in getting started. He dialed the number of the real estate agent who had assisted my parents in finding their home. My father informed the agent that I had started mowing lawns in the area. Because she was aware of so many new homes in the neighborhood, she gave me a flood of work very immediately. Consider attending local real estate networking events if you’re just starting started in lawn care. Attempt to establish yourself as the go-to lawn care specialist for a number of real estate brokers. There’ll never be a time when you don’t have leads.”
Owner of Lewis Commercial Writing, Alexander Lewis
Obtain Government Contracts
Through government procurement contracts, government-owned buildings such as schools and military posts engage lawn care businesses. You must register with the appropriate federal, state, or local agency in order to apply for these contracts. If you’re interested in government contracting, go to your local Procurement Technical Assistance Center (PTAC), which is a taxpayer-funded federal initiative that offers no-cost government contracting counseling to small businesses.
Online Marketing
When prospective consumers search for your lawn care firm online, having a good web presence can help you get in front of them and offer you credibility. When someone searches for your company name on Google, for example, your Google My Business (GMB) page will appear, complete with customer reviews, business photographs, and contact information.
Here are some internet marketing ideas for your lawn care business:
- Website: Your lawn care service’s website serves as a digital billboard for your company. If you’re building your own website, save time by utilizing an existing lawn care website template and filling in the blanks with your company’s information.
- Email marketing: The greatest free or low-cost strategy to get your company in front of existing consumers is via email marketing. For example, you might send an email to your current client base informing them that you would be offering a referral fee to anybody who refers a new lawn care customer. For the first 2,000 email subscribers, MailChimp is free.
- Social media marketing: At the very least, you should build a Facebook page for your company and produce a dozen high-quality posts about it. When someone searches for your lawn care company’s name on Google, your Facebook page will up. Having your Facebook page appear in Google helps boost your company’s trustworthiness.
- GMB: Every company with local clients receives a free listing on GMB. Fill up your business’s essential information, such as phone number, hours of operation, and address, at the very least on your listing. You don’t have to provide your home address if you run your lawn care business from home. You may conceal your address and define a radius around which you mow the grass.
Customers may immediately contact you with inquiries about your company using GMB.
You may focus on your web marketing techniques every week, month, or quarter, depending on how much time you have. Your website should, at the very least, be kept up to date with correct information. Every month, evaluate your GMB listing to keep an eye on bad reviews and report any improper or misleading photographs that people may have posted.
Frequently Asked Questions (FAQs)
What does it cost to establish a lawn-care company?
A lawn care business may be started with as little as $2,000 and as much as $100,000. The amount you pay is determined by your equipment requirements. With old equipment kept on a vehicle you already own, a $150 company registration, and liability insurance that costs roughly $400 per month, you can start a low-budget mowing business. When you add industrial lawn equipment, vehicles, trailers, personnel, and an office to your lawn care firm, your expenditures rise.
Is a license required to establish a lawn care business?
Yes, you could require a permit. Lawn maintenance in certain areas, such as Alabama and California, requires a license. A license is not required to run a lawn care business in several jurisdictions, such as Georgia and Illinois. Before starting a lawn company, verify your state’s (or city’s) licensing requirements, which may be found on your state’s (or city’s) official website.
What do you charge for mowing a lawn?
The cost of lawn maintenance varies from $30 to over $200 every visit. The amount you charge per lawn is determined by the size of the lawn and the sort of lawn services you perform. As a general guideline, charge $60 per worker every hour of labor. You should also include travel time when estimating lawn mowing costs. Because of the short trip time, you may be able to offer a reduced price if you are currently mowing a lawn in the area.
Is lawn mowing a profitable venture?
Yes, mowing lawns may be a lucrative company if you’re well-organized and provide high-quality service. If you give excellent service, word of mouth may swiftly expand your company. That is a distinguishing aspect of a lawn mowing service. The length of travel time between jobs is a problem for many lawn service firms. It’s preferable to concentrate on one neighborhood or region and develop a customer there. Concentrate your marketing materials and networking efforts on a single target audience, such as homeowners’ association (HOA) meetings.
How much does it cost to get a lawn care company license?
A lawn care license, if required by your state or municipal, usually costs less than $100. Remember that, in addition to obtaining a business license, your lawn service will need to register as a business entity in your state, which will cost you roughly $150.
How much does lawn care business insurance cost?
If a lawn care business has employees, it must have liability insurance, commercial vehicle insurance, and workers’ compensation insurance. Liability insurance for a lawn service costs about $400 per year and protects you from property damage. For modest coverage, commercial vehicle insurance costs about $750 per year. Workers’ compensation insurance costs around $450 per employee each year.
Conclusion
A lawn care company might be a little side hustle on the weekends or a multimillion-dollar enterprise with hundreds of workers. You’ll need a business plan with financial estimates to get started in any case. To monitor and attract new consumers, use services such as a CRM system and a GMB listing. Your lawn care firm may be a very lucrative and successful business after you’ve paid for your equipment and built a strong customer base.
