Mowing isn’t rocket science—you fire up a mower and go. But making money at mowing might qualify. Why? Because you can’t just eyeball a job site, quote a price and send your guys out scrambling every which direction to fulfill the contract. You have to have systems in place to make sure equipment is properly maintained, routes are in order and everyone is on the same page. And like it or not, you have to get friendly with numbers—you can charge $30 per hour, but will that sufficiently cover your cost per man-hour? If you don’t know the answer to that question, you probably won’t be in business for long.
The following 10 contractors are doing well in their businesses, and that’s because they’ve taken their lumps and know how to run a profitable and efficient mowing operation. This might be the only good time to stop mowing and listen to what they have to say:
Tip 1: Hire in-house mechanics
Utz Environmental Services
Location: Austin, Texas
President: Chris Utz
2003 gross revenue: $9.2 million
Services: Full-service
Customer mix: 85% commercial, 15% residential
Employees: 200 (peak-season)
Avg. mowing rate: $28.50 per man-hour
Primarily a design/ build firm, mowing and other maintenance was only something Utz Environmental Services offered to keep their projects looking good. Only recently did President Chris Utz realize they also had to make mowing profitable, and the number one thing that helped make that possible was hiring in-house mechanics. Utz estimates that they’ve easily saved over $100,000 a year by doing this.
“What we’ve seen is that our overhead has gone down because we need less backup equipment—broken down equipment doesn’t sit around for days,” Utz says. “And we’re not paying the high prices service facilities charge to fix the equipment.”
An example: You send out a broken mower to a repair shop, and the charge will be $45 for an hour—even if it doesn’t take an hour to fix. So by having your own mechanics, you don’t have to pay set wage rates. Plus, you don’t have to transport the equipment to and from the shop, and you don’t have to pay marked up prices for parts because you’re getting them from the same place as your local repair shop. As Utz says, “Never watch the top line; always watch the bottom line.”
Tip 2: Use the biggest mower possible for the job
Wilson-Oyler Group
Location: Thousand Oaks, Calif.
Co-owner: Bruce Wilson
2003 gross revenue: N/A
Services: Consulting
Customer mix: N/A
Employees: N/A
Avg. mowing rate: N/A
Bruce Wilson knows a thing or two about mowing. He spent 30 years as head of the maintenance division of Environmental Care, Inc., (now ValleyCrest Landscape Cos.), the largest privately held landscape company in the country.
His advice for more profitable and efficient mowing? Use the largest possible mower for the job. Well, duh, right? Not really.
“What happens is that most companies go out to a job site with two or three different size mowers on the truck, and everybody starts mowing with the three types of mowers at the same time,” Wilson says. “Everything they mow with the smaller mowers that could be mowed with the bigger one is slowing down their production rate. They’d be better off if one guy mowed with the big mower and the other two guys trimmed or did something else. That’s a more productive use of their time.”
Tip 3: Know what you have to do before you do it
Southwest Landscape Management
Location: Columbia Station, Ohio
Vice president: Steve Rak
2003 gross revenue: $500,000
Services: Commercial maintenance, snow plowing
Customer mix: 90% commercial, 10% residential
Employees: 10 (peak-season)
Avg. mowing rate: $35-$40 per man-hour
Steve Rak’s message to those who want a more profitable mowing operation: Get organized.
“You need a good foreman who can manage the job,” Rak says. “You can have good equipment and good trucks, but if you don’t have organization in the field, you don’t have anything. Because that’s what we sell: efficiency.”
Southwest Landscape Management’s “organization” is comprised of three things: 1.) A foreman’s bible, 2.) Charting hours, and 3.) Keeping same crews on same accounts week-in, week-out.
The crews know what they need to do at each account, so there’s not a lot of talking. Someone does the “rider” work with a riding mower, someone does the “52” work with a walk-behind, and someone does the “Walker” work with a Walker rider – usually a high-visibility area in front where grass clippings need to be collected, etc.
Tip 4: Know the time it takes to mow a property
BLT Landscape Services
Location: Dallas
President: Larry Brinkley
2003 gross revenue: $1.4 million
Services: Full-service
Customer mix: 60% commercial, 40% residential
Employees: 25 (peak-season)
Avg. mowing rate: $30-$32 per man-hour
Don’t make mowing a guessing game, says Larry Brinkley. Know the time it takes to mow each property you have.
“We actually measure each of our sites and periodically check our guys to see how long it takes them to mow 1,000 square feet of turf,” Brinkley says. The company uses a measuring wheel for the sizing, and will have two different employees mow the same property to get an average time.
“That’s part of the problem (with pricing),” Brinkley says. “If you took national averages, your guys might be a little faster or slower than the rest.” Different mowers are timed on each property as well – walk-behinds and riders. BLT then takes their information and inputs it via computer to maintain as much accuracy as possible.
Tip 5: Route efficiently
Pratt’s Lawn & Landscape
Location: Georgetown, Ky.
Assistant manager of lawn care: Robert Halasek
2003 gross revenue: $1 million
Services: Full-service
Customer mix: 100% commercial
Employees: 25 (peak-season)
Avg. mowing rate: $45 per man-hour
Bob Halasek’s tip seems so logical and makes a lot of sense: Have your routes set so that there’s not a lot of travel time. In other words, service sites that are all within close proximity of each other.
“If it means taking an account that’s cheaper than what you normally do just to get a full day in town, then so be it,” Halasek says.
On the flip side, the company will turn away accounts or simply not bid on them at all if they’re not feasible. Pratt’s is located on the north side of Lexington. Halasek says they would only consider going to, say, the southeast corner 35 minutes away if it was an eight-hour job.
“If you’re going to travel 35 minutes somewhere, you better make sure everything gets done down there so you don’t have to make a return trip,” Halasek says. The company aims for four 10-hour days of work during the week, leaving Friday open in case of inclement weather.
Tip 6: Don’t offer any ‘reverse incentives’
World of Green
Location: Lincoln, Neb.
General manager: Larry Burklund
2003 gross revenue:
Over $1 million
Services: Full-service
Customer mix: 100% commercial
Employees: 45 (peak-season)
Avg. mowing rate: N/A
It pays to understand human nature, according to World of Green’s Larry Burklund. It’s good to get a job done early—but not if it means you’ll be asked to help out someone else who isn’t done with their job yet.
“If you have a crew that busts their butt all day and gets done at 3:30 p.m., it makes no sense to send them off to help somebody else,” Burklund says. “What will happen is that they’ll drag their butt until 5 p.m. in order to get out of helping the other crew.”
So Burklund says the best thing to do is have them come back to the shop and get ready for the next day by servicing the equipment and gassing everything up.
Tip 7: Know your overhead
ND Landscape
Location: Topsfield, Mass.
Co-owner: Manny DeSouza
2003 gross revenue: $4.1 million
Services: Full-service
Customer mix: 90% residential, 10% commercial
Employees: 50-55 (peak-season)
Avg. mowing rate: $42 per man-hour
It’s fairly obvious that Manny DeSouza is obsessed with the “numbers.” In fact, he revels in talking about them.
His tip for more profitable and efficient mowing: Know your overhead. That is, the cost of materials, subcontracting, small tools, equipment rental, dump and disposal, etc. Knowing that allows him to know his gross profit weekly, which he analyzes every Wednesday. And he knows he can take 19 percent of that off the top as his “labor burden.”
Knowing all of that data, he knows his company can charge $38 per man-hour for mowing 215 homes that are each 30 feet apart. Otherwise, it’s $42 per man-hour.
“In the end, we want 10 percent to 12 percent net-net,” DeSouza says. Tracking these numbers “drives efficiency of systems,” says DeSouza. “We pay bonuses quarterly if target numbers are hit, and people start paying attention to that.”
Tip 8: Consider having a “flex” crew
Weidner Lawn & Landscape
Location: North Ridgeville, Ohio
Owner: Jim Weidner
2003 gross revenue: $1.2 million
Services: Full-service
Customer mix: 60% residential, 40% commercial
Employees: 22
Avg. mowing rate: $30-$40 per man-hour
It sounds crazy, but Jim Weidner makes his guys work on Saturdays. Well, he doesn’t make them, it just works out that way.
See, in addition to working “four 10s,” or Monday through Thursday 10 hours a day, he has a “flex” crew that has different days of the week off. They still work four 10-hour days, but two of those days are Friday and Saturday. By doing this, he doesn’t have to pay overtime and get sick watching his equipment and trucks sit around for two days.
“If you’re not working Fridays and Saturdays, you’re missing 70 days, and that’s a lot in a short season,” Weidner says. “Plus, it dilutes our overhead by keeping our equipment and trucks running on a beautiful day.”
Tip 9: If you’re going to subcontract mowing, mark up appropriately
Tomlinson Bomberger Lawn Care & Landscape
Location: Lancaster, Pa.
General manager: Tom Shotzbarger
2003 gross revenue: $6.1 million
Services: Full-service
Customer mix: 70% residential, 30% commercial
Employees: 65
Avg. mowing rate: N/A
Tomlinson Bomberger subcontracts all their mowing. But that doesn’t mean they’re not wise to a few helpful hints.
If you ever do subcontract some mowing, record an appropriate markup, says general manager Tom Shotzbarger.
“Make sure your account managers know how to recover indirect expenses,” he says. “If a landscaper charges you $1,000 for a mowing, and you mark it up 10 percent to 15 percent, you’re losing money on that effort.”
Why? Because at Tomlinson Bomberger, their indirect expenses usually amount to 25 percent to 40 percent. These indirect expenses are mostly administrative, Shotzbarger says, such as sales commission.
“If you pay 5 percent commission, and you only marked up 15 percent, then you’ve only got 10 percent to cover your other indirect expenses.” Not good.
Tip 10: Manage the work to the estimate that was produced
Groundmasters
Location: Cincinnati
General manager: Mike Rorie
2003 gross revenue: $16.7 million
Services: Commercial landscape management and installation
Customer mix: 100% commercial
Employees: 240 (peak season)
Avg. mowing rate: $35 per man-hour
“Most contractors make a deal and estimate it, price it and sell it, but they never measure the performance of that job against that estimate again,” says Rorie.
So if your guys are consistently taking two and half hours to complete a job that was estimated at two hours, Rorie says it’s your responsibility to “engineer that job to the estimate.”
And if you’ve “engineered” the job as low as you can get it and still aren’t hitting the estimated time, the sales person needs to be held accountable for the original estimate and needs to adjust the negotiated price. Why? “Because the original estimate should have been based on what you’ve proven you could do in a given time frame,” Rorie says.
