How to Start a Landscaping Business
If the thought of greenery and working outdoors seems like heaven to you, you’ve may have considered starting a landscaping business. Lawns don’t seem to be any less common, and there will always be people who want you to care for theirs. According to the National Association of Landscape Professionals (NALP) 2018 numbers, the landscape industry employs over 1 million people, representing 513,305 businesses, and has annual revenues of approximately $93 billion. Those are not small potatoes for a sector that is expected to continue to grow.
How to Start a Landscaping Business
At the most basic level, it doesn’t take much money to start a lawn-care business. All you need is a power mower, a pick-up truck, and experience. However, the work isn’t necessarily that simplistic. It can range from basic lawn maintenance to tree maintenance to complex design projects.
Before jumping right in, many aspiring landscapers may first work for another landscape company or choose to start their business as a side job. While its a good starting point, eventually you may want to have more control over your schedule and your work.
You may prefer to work for yourself rather than a bigger company so you can nurture relationships with your customers. But you may not want to stay small. Most landscapers end up offering several services, such as landscape design, groundskeeper at commercial properties, or may own a fleet of landscaping trucks.
Pros and Cons of Starting a Landscape Business
There is plenty of opportunity in this growing service sector. You can offer a range of services and craft the type of business you want. But as with every business, there are pros and cons. Going into it with your eyes wide open is the best way to leverage the pros and overcome the cons.
Pros of Starting a Landscaping Business
Many people decide to start their own business because they want the flexibility of setting their schedule and/or they want to be their own boss. A landscaping business has a lot to offer and can evolve into something bigger if you choose to grow it.
- Stable, Repeat Business—lawn maintenance is ongoing and consistent. Your customers will need their lawns mowed weekly .
- Revenue Generating Add-Ons—not only do your customer need their lawns mowed, but they may also need special treatment for weeds, fertilizers to help the lawn grow, and insecticides to get rid of bugs. These recurring services may be required every 4-6 weeks, so they can become a steady stream of income for your business.
- Easily Scalable—although you may plan to offer more than one service, you can start with the basics—mowing lawns. From there, as you build your customer base, you can branch out into other services such as landscaping, laying new sod, tree trimming, gardening, and weeding. There are many ways you can scale up as customer needs and demands evolve.
- Easily Customizable—once you’ve established your business, there are a variety of ways you can customize it to fit your expertise or needs. You can be a one-person show, doing it all on your own. Or you can manage several teams of landscapers. You can choose to focus on residential landscaping, commercial landscaping, or both.
- Entry-Level Workforce—landscaping is generally learned on-the-job. This means you don’t have to look for highly skilled workers to hire, which reduces training and recruiting costs. However, there is often a high turnover rate with this workforce.
- Franchises—if you don’t want to start from scratch, there are many reputable and proven landscaping franchises available. Or you could choose to buy an existing business, which would give you a ready-made customer base and equipment.
- Seasonal Business—if you live in an area with cold winters and you have summers off (teachers and full-time students, for example), you can earn extra income with a landscaping business in the summer.
Cons for a Lawn Business
Of course, there are some issues to take into consideration as you plan your landscaping business.
- Seasonal Business—unless you live in an area with a mild or tropical climate, your customers may not require your services in the winter. If you want a year-round landscaping business, you’ll need to diversify your services by offering things like gutter cleaning, snow removal, pressure washing, winter lawn prep, leaf removal, and holiday light installation and removal.
- Start-Up Costs—although the start-up costs can be lower than starting other types of business, there are certainly costs to consider. Depending on the type of landscaping services you choose to offer, you will need equipment as well as a truck and possibly a trailer to transport your equipment.
- Competitive—although healthy and growing, the competition in the landscaping industry is notable. You can find out how competitive it is in your area through online research, seeing how many landscaping companies there are locally. If the market is saturated, you'll need to figure out how to best compete, such as on pricing. Before you jump in, do your research to help validate that a landscaping need exists.
- Economic Risk—no business is immune to fluctuation and economic risk. When economic times get tough, residential costumers often decide to get rid of non-essential expenses, one of which might be their landscaping service.
Keep in mind that no matter what business you want to start, there will be risks. Knowing about them ahead of time can help you prepare for whatever might happen.
Landscaping Industry Snapshot Going Forward
The landscaping industry in the US is expected to grow at compound annual growth rate (CAGR) of 4.5% in 2020-2025. This growth is fuel by increased spending on home improvements, neighborhoods in the south getting larger, and aging Americans who no longer want to care for lawns themselves. While demand for residential landscape maintenance is growing, there is a shortage of labor in the market.
Choose a Name for Your Landscaping Business
If you’ve decided to go ahead and take the plunge into starting a landscaping business, you’ll need a name for it. Your business name is the first thing your prospective customers will hear or see when they first use your business. And, your business represents you. For these reasons, it’s important to think about your business name. Changing the name of your business once it is established can cause confusion with your customers, so it’s important to take the time to get it right.
Use these tips to help you decide on a name for your business:
- These days, you need to think about your business presence online. It’s crucial to choose a name that lets you get a relevant domain name.
- Think of name that is unique enough to stand out from the crowd but not too hard to remember. A generic one makes it easy for people to overlook your business, and if people cannot remember your name, they won’t be able to find you.
- Mention what your business is in the name so that people won’t be confused. Include the word landscaping so your future customers won’t have to guess what you do.
- Don’t limit your business. Maybe you start with sprinkler repairs or lawn service. If you plan on expanding your business offerings, make sure to name your business accordingly.
Defining Your Goals
Identify your business goals, so you know where you want your business to go. Why have you chosen to start a landscaping business? How hard do you want to work? Who will be your first customer? Where will you look for your first customer? These are all questions to ask yourself when you are defining your goals.
Write a Landscaping Business Plan
A goal without a plan is just a wish. Self-motivation and passion will only take you so far. So, your first order of business will be to write a landscaping business plan. Once you’ve decided on the name for your landscaping business, make a list of starting expenses. Then set short- and long-term goals. This will be the foundation you use to set up the steps to help you reach your goal.
Calculate Your Startup Expenses
Starting a business always requires some capital, so having some money set aside before you get started will keep you from starting in the negative. You are bound to have startup expenses such as:
- A tablet or smartphone to access the Internet
- Licensing according to local regulations, generally for chemical pesticide application
- Occupational Accidental and General Liability insurance
- Business and vehicle insurance—often a requirement for licensure in most states
- Truck with a flatbed trailer or powerful pickup truck
- Two commercial mowers—even if you are working on your own at first, you don’t want to risk having only one mower, in case something happens to it
- 1 Gas can for regular fuel for your mower and 1 for mixed-fuel for your edger, blower, and other equipment. Always follow the instructions in the user manual when putting fuel in your equipment.
- Edger for cutting borders around sidewalks and driveways
- Trimmer for cutting grass around trees and other hard-to-reach areas
- Blower for cleaning up stray clippings off driveways and sidewalks
- Smaller tools such as rakes, shears, and shovels
- Toolbox for simple repairs
- Pesticides and fertilizers
- Safety equipment, including safety goggles, noise-canceling headphones, sturdy gloves, and steel-toed boots
If you are starting from scratch, the total cost for your equipment will vary, but typically ranges from $15,000 to $20,000 to start a landscaping business.
Determining Your Rates
How to determine your rates is always tricky. What makes this so difficult is that what you charge has less to do with what you want to earn and more to do with the costs of running your landscaping business. This means you must figure out your overhead and add that number to your rates.
List out your costs: insurance, truck payments, and any other costs. Jot down your estimated taxes, even if it is a guess. Figure out these costs for a year, and divide by the number of months you will be working, depending on the seasonality of your area. Then divide that by the number of weeks you will be working. That is your overhead burden. You add this number to how much you want to earn for your time.
Challenges Faced in the Landscaping Industry
When working on your own, it’s fairly easy to track jobs and bids, expenses and paychecks with a pen and paper. But as your business grows, these methods don’t work as well. Now you need to know how to manage a landscaping business.
As you start to grow your business, you will encounter different challenges. Here’s a breakdown of the three biggest industry challenges you will have to overcome.
As your business grows and you hire more employees, you’ll be sending trucks out all over your area. You’ll quickly realize that fuel costs are a huge part of your operating costs, sometimes as much as 60%. While you don’t have much control over fuel prices, you can track, monitor, and reduce the fuel usage of your fleet.
Asset Management and Utilization
The more employees and assets you have, the more important it is to ensure they are secured at all times. Aside from the money it takes to replace lost or stolen assets, it also results in downtime that you can’t afford. Your employees won’t be able to get to their jobs on time, which can potentially result in lowered customer satisfaction.
Keeping your labor costs down is key to keeping your business’ profitability. Excess overtime and timesheet fraud can cost you money. Timesheet fraud takes place when a driver gets paid for work they didn’t do, or for time spent on non-work activities. This can happen when a driver records more hours than they worked. Timesheet fraud costs you money, and can also cause your customers to be billed incorrectly.
Competition and Customer Service
Landscaping is a competitive business. Top-notch customer service is one way to ensure you beat your competition. Making sure your team arrives on time, can respond quickly in an emergency, returning phone calls promptly, and communicating clearly. A happy customer will accept an occasional problem, but a dissatisfied customer will harp on every flaw.
Benefits of Fleet Management and Tracking Solutions
Landscaping fleet management and GPS tracking can help improve these key challenges for landscaping fleets. These efficiency-boosting systems can help you with things such as invoicing, dispatching, fuel costs, and more. The sooner you use one for your landscaping fleet operations, the better.
Here are some of the ways fleet management software can help you overcome industry challenges.
Reduce Fuel Costs
Before you can save on your fuel costs, you have to know how much your fleet uses. Telematics can measure your fleet’s fuel usage and put the results into reports that you can use to get the big picture and drill down into the details. You can track driver behavior to increase your fuel consumption, such as rapid acceleration, excessive idling, speeding, and harsh braking.
When one of your landscaping trucks is driven for personal use, your company’s fuel is wasted. These trucks are entrusted to your employees for completing jobs, and they should be used mainly for that purpose.
You can reduce or even eliminate unauthorized or personal usage by taking advantage of driver identification and geo-fencing. With driver identification, you’ll know when your landscapers have arrived at a job’s location, how long they spent there, and when they left. And combined with GPS tracking, you can see where they stopped and if they took an unauthorized trip or ran personal errands on your dime. Geo-fencing lets you set boundaries for your vehicles so that if they travel outside that boundary, you are alerted and can find out why.
Optimize Fleet Utilization
Optimizing your fleet utilization has two benefits. With GPS monitoring, you can ensure that your trucks are sent to jobs that are nearest to their location, saving fuel by not driving as far. You can also make sure they take the best routes, avoiding traffic or other unexpected delays, so they arrive at their location on time. This way, drivers will have plenty of time to get their destination, so they won’t be tempted to speed.
You can also schedule jobs that are close together to a specific driver, so they stay within a certain area and don’t have to drive too far to get to their jobs. By monitoring these things, you can lower fuel usage, reduce wear-and-tear on vehicles, and make sure they are utilized as much as possible.
Reduces Overtime and Timesheet Fraud
By monitoring automated time logs and allocating resources based on real-time insights, you can reduce overtime for your business. For instance, if a customer needs last-minute service, you or your fleet manager can send the nearest team, based on their location and how many hours they’ve worked. Using this information, you can keep your teams from going over their allotted hours.
No one likes to think about it, but timesheet fraud is a reality. Not only does this result in employees getting paid more hours than they worked, and costing you money, but your customers are being billed incorrectly. It can even affect employee discipline and morale.
Timesheet fraud generally happens more often in landscaping companies that use manual processes because employees input their information without checking accuracy. This issue can be solved when driving hours are tracked automatically.
Improved Customer Service
When you bill customers hourly, making sure you bill them accurately is essential. Billing your customers fairly, based on accurate information, helps keep them satisfied and builds the type of trust required for a long-term relationship. Having a telematics solution that keeps track of driving hours automatically helps you easily figure out how long a driver was with a customer and bill them accordingly.
When your billing is accurate, your landscapers are on time, and you communicate honestly with your customers, you're well on your way to beating your competition.
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