$28K to $1.6 MILLION!! HOW I GREW MY LAWN CARE BUSINESS! - Could I Have Done Better?

This is the part of the business that most people, part of the evolution of growing company that a lot of people do not take. And that is taking a year where it's like, look, we're not going to grow, we're not going to try to keep growing, expanding at this rapid rate, hiring more people, getting more trucks. We're going to focus on profitability, creating systems and really creating a place that runs without the owner. A lot of work that goes into that, creating those systems. But I really feel like I could have got to year seven in year three if I would have just had those systems in place prior to.

Hey everyone, it's Mike Andes, Landscape Business course. And today we're at the Augusta of Whatcom county location and we're doing a little bit something special for you. I want to go through each year as we grew Augusta Lawn Care from nothing and go through each year in terms of what our revenues were and how we changed the business as we begin to grow, make it more systems oriented, more profitable and get it to where it is today. We have about 30 locations around the United States and Canada as franchisees. But I want to go back all the way to nothing where we started and the journey that got us to where we are now. So when I started Augusta Lawn care I was 18 years old and at night I was doing my MBA masters in business Administration at Western Washington University. But I started Augusta Lawn Care while starting that program in the evening. So I was basically working part time by myself out in the field doing all the work myself and started with P1, which we can't show you because all the crews are currently gone, but just a small Dodge 1500 Ram 2010 I believe. Truck got it for $7000, got an enclosed trailer 6 by 12 and spent a couple thousand dollars on equipment and got rolling. And that first year I was part time, I was working part time as a personal trainer at an anytime fitness gym and then part time in the field working every single day and made about $28,000 in revenue that first year when I was 18 years old and basically just doing mowing. I think if I remember correct, I had 28 to 29 mowing customers weekly and bi weekly services. Really just focusing on those simple services. Did not get into landscaping whatsoever and it was just me working by myself all the time, part time. All right, so that takes us to year number two when I was now full time doing lawn care, Augusta Lawn Care and really took it to the next level at this stage I had to change the logo because Originally we had a very much of a golf theme and we actually got a sea sort assist from Augusta national and said, hey, you gotta change that. So that's when we changed the logo away from golf more and began to really focus on growing the business. That was my first year full time, so I stopped being a personal trainer, did it full time, and did just under 200,000 for annual revenue in that second year. Midway through the years when I hired my first person, at first they started part time, just helping me a couple days a week outside their other job. And then he became full time later on in the fall of that second year. So really begin to grow towards the second half of the second year. At that point we had about 60, 70 mowing customers. We didn't really do a whole lot of landscaping at this point. Really still focusing on mowing, weeding, bush trimming, property cleanups, and really basic services. Inside that second year we got a second truck, a second trailer, and got my first employee. So that was kind of exciting. We moved from a storage facility where I was literally just parking the enclosed trailer and then I would come and pick it up every day. We moved to an actual facility that was a 15 by 40ft long shed, basically where we could store the trailer, store the two trucks. And I think we paid about $250 a month at the time for that. It was out in kind of a rural area, so it wasn't like great location. But at this time we were just focused on Blaine. And for the next first few years of my business, just focused on Blaine, which only has like 6 or 7,000 people living there, and really focused on route density and not focused on the larger part of the county, which is Bellingham, where we're currently at now. But those first couple years, really just focusing on Blaine, getting that first employee, learning how to, you know, hire someone, do payroll, all of that sort of thing, but still focusing on the simple services. In year number two, we did just under 200,000 in annual revenue. Alright, so that brings us to year number three. The big thing that happened in year number three is we ended up getting a retail location over in Blaine. What happened is there was a trucking company whose owner passed away. It was a really small operation. Him and his wife, he passed away of a heart attack. And we were able to get their land, which is about an acre and a half, maybe two acres of land, basically started to rent there. And at the time, again, we only had two trailers, two trucks, and one employee. Starting off in that third year, that year Though we grew a lot, we grew about 480,000 revenue that third year. And in that year is when I got my first office manager, which was Liz. And I got her about five months of the year, like in May, early, early in the spring, because I just got crazy. We had the materials yard where I was trying to load material for people that would come into the shop and load up their truck with mulch or gravel or soil. And, you know, at the time was really good because having the retail yard allowed me to have a full time office person and afford them because they would be there all day long. Maybe not necessarily needed full time for the services side of the business, but they would load up. This was Liz at the time, loading up material for customers. And we made some sort of, you know, extra revenue from that ancillary service later on as we'll get into. Like, I had to eventually cut out those retail services and in terms of loading material, delivery with a dump truck, all of that. But at the time it was great because the land that we were renting already was set up with bins. The big concrete bins is already set up for that. Had an office already. So I think we spent about 10 to $15,000 to kind of get situated in there, reorganize the shop. But just a great piece of land where we ended up growing for the next few years. And we signed a three year lease there. And we spent all three years at that location. And in that third year is when I hired the second and third employee in addition to Liz. So we had about three people out in the field. Later in the year, both two of them would leave and we'd be back down to Josh, Liz and myself. So at the end of year three was kind of a reset in the winter, obviously not knowing how to do winter services, not knowing how to stay busy during the winter, not knowing how to, you know, really do any sort of things outside of basic maintenance and mowing. We didn't have services to keep us busy throughout the winter. And so what we tried doing the third year that was interesting was we started getting the landscaping and bigger jobs. I remember taking on our first landscaping job that was over $10,000. We rented a skid steer. We had like 120 yards of fill dirt and we built up a big, like, not a cliffside, but we just built up this massive grade and then put a lawn on top. And we were way out of our league. We tried to do it to keep our crew busy going into that third winter, trying to keep the Crew busy and wanting to challenge them. The ones that had been there for a while already. And it ended up just being a miserable job. We ended up giving like I think 50% of it back for free to the customer. And that was really our foray into landscaping. And at the time I kind of chalked it up to a learning experience and figured, hey, like we, we're just gonna have to do this to stay busy throughout the winter, figure out landscaping. And we kept going forward with more hardscaping and landscaping and bigger projects, whether it be grading, sod installation, block and paver, patios and walls. Started getting more involved in year four. But at the end of year three is our first foray into larger jobs. You know, we had our first job over 10,000. Our second job over like 5,000 before that was all simple services. All property cleanups, mulch installations. That was like the extent of landscaping that we did. But that end of that third year, we started getting more and more into hardscaping and landscaping. Finished off the year a little under half a million in revenue. And by the end of the year, throughout the winter, just Josh, Liz and myself. Alright, so year number four, we did about 8 to 900,000 in annual revenue. Really grew quite a bit. We're still at that retail spot there in Blaine, couple acres now. At this point we had like four or five trucks. We started to hire more people as we got into year number four. And this is where really the mistake that most landscapers make and that is diversification of services, adding more and more services. And what a lot of people do is as they get more experienced employees, they will match someone's level of professionalism or match their skill set to now adding more services. So that's what we did. We started hiring people that had some skill to do a little bit of construction jobs. And we started building patios and walls and boulder walls. And it's getting involved quite a bit. That's what led to the growth in revenue, even though we didn't hire a ton of people, is because we started doing bigger projects. And we had to get a couple skid steers and a tractor and we started getting more dump trailers. We got big dump truck, big dump truck, F700. And really started getting involved in doing bigger projects. Obviously the retail yard was now up and running. It only did about 120,000 in annual revenue in terms of the retail side. But it definitely added complexity because if you have deliveries, you. You gotta fit those in around all your other jobs. Cause you're using the truck for landscape jobs. Otherwise it's sitting there all day and a waste of money. And then there's days where you have three days where there'd be no deliveries from material and then you'd have 15 in one day. So it was very much up and down. Wasn't as consistent as we liked. Same thing with big projects. You get one massive project, make $40,000. Seems really good in terms of revenue numbers. But I guess at that point we were really caught up in growth. We were getting lots of new trucks, Hiring more people throughout that fourth year, and really beginning to grow, which was great. But it wasn't like we were super duper profitable. We were just growing a lot. And with growth comes waste. And we were still in blaine, still hadn't moved there. Really starting to feel like we were kind of outgrowing that shop in year number four. But the big thing is we started hiring a lot of people. We started burning through people having to let people go. As we started hiring more, Just realizing we didn't have systems in place for culture in terms of P4P, things like that was just very difficult. And we were growing fast though. And with growth and a lot of success, you can kind of glaze over the fact that you're not as profitable as you should be. You're not retaining the employees the way you should be, and the employees are not getting the benefit that they should be in terms of compensation and just a culture that they can come to work for every single day. Alright, so that brings us to year number five. Year number five is when we added artificial turf. And that's why we're here on the putting green out front of the shop right now. We no longer do artificial turf, but in year five is when we started doing it. And again, we were doing it because we were trying to match what services we were offering to the type of people we had. We wanted to retain them, wanted to challenge them, and so we kept adding services. We had a tree chipper at this point. We were building boulder walls and paver patios and designs like this with putting greens. Very, very complicated stuff. And at the time, though, it led to more growth. We did about $1.1 million in year number five. And it was at this point that I started realizing towards the end of the year, we had to have systems. We had to make sure things were in place. Even things that I had kind of half baked in the business need to be perfected. At this point, I really wanted to create something based around performance for the pay structure of the Employees, but didn't know how to do that without spending a whole bunch of time calculating every day. So this is really the pain part of the business. 1.1 million in revenue, but lost employees. Tried to add more and more services to continue growing. And we probably at this point we're about eight, nine employees with about six trucks and really had grown a lot. Again.

$300,000 from the year prior went to 1.1 million. But at this point it was just not profitable as it should be. I knew it needed systems. We started doing some cultural things like off site meetings, a little bit of open book management. But I did not feel like this was where the business needed to be at because I had to be there every day. I was the estimator, I was selling. That was really my only role. I had a great office manager, great people still working the field, but I was still selling. Doing the selling part of the business. Selling all the jobs, doing all the estimates, really working every single day at the shop and having no ability to just leave for a week. That was not in the books. In year number five. Went through a lot of people trying to find the right fit for the company. Lost some experienced people because we started towards the end of the year cutting services out. But artificial turf was the year of. Year 5 was the year of artificial turf. Lots of revenue. You get lots of money on $30,000 projects. But it was just not something that we were really, really good at. And it was hard to train people. They'd take them six months to get really good at it and then they'd be moving on to someplace else. Or you do a project and there's an issue with it. And now you have massive amounts of labor going back and fixing the problems. Because we weren't as trained as we should have been and we didn't know what we were doing exactly. Really back to the idea of focusing on those simple services. Focusing on the services that you can predictably have a consistent profit margin on Artificial turf. Great for revenue, horrible for profitability, horrible for being able to hire someone that doesn't know what they're doing and quickly train them up to be really proficient. And we were leaning really on just a couple people to know how to do artificial turf. Well, when they left, that was the writing on the wall. I needed to really restructure the business, simplify services, get the systems I knew needed to be implemented and take the business to the next level. Alright, so year number six, yeah, we took the business to the next level, but not necessarily in revenue. It was about changing the culture, changing the systems of the business, and making sure the business could run without me. And so this is the part of the business that most people. Part of the evolution of growing a company that a lot of people do not take. And that is taking a year where it's like, look, we're not going to grow. We're not going to try to keep growing, expanding at this rapid rate, hiring more people, getting more trucks. We're going to focus on profitability, creating systems, and really creating a place that runs without the owner. And so that's what we focused on in year number six. During year number six is when we implemented pay for performance. And that's where you'd pay your employees based upon their production instead of their hourly how many hours they worked. And that was a big change for the business. We ended up going through quite a few employees, having to fire people that had been with the company. Great employees, great workers, great team members, but they just were not going to work with the new culture that we were trying to build of openness, transparency, and being able to be autonomous from me as the owner, being there every single day to manage everything. So, you know, last year, year number five. So last year, year number five, we did about 1.1 million. We only went to 1.2 million in year number six. This is when we moved to the Bellingham shop, which was a big move for us because our three year lease had ended at our previous location and we had grown a lot. It kind of outgrown that location. And so we didn't get a lease renewal from our landlord. So we decided to move to Bellingham and at this current location and really begin to grow here. And so year number six was a big transition year for us. In that year, we implemented the systems, had to get rid of a lot of people, change the culture, change the dynamic of what we were trying to do at the local shop here in terms of focusing on just the core competencies of mowing, lawn care, property cleanups, and really basic landscaping jobs. None of this like 20, 30, $40,000 jobs. We were just not going to touch those anymore. We screwed, scrapped artificial turf. We sold a tree chipper. We got rid of all material delivery like the retail yard, got rid of that for the public. The bins were only for us and our services. And we got rid of the dump trucks. We sold the dump trucks off. We sold off all the scrap artificial turf. We got rid of bigger pieces of equipment that we didn't need anymore, like the tree chipper. And so year six was a big change for us and we had to do that in order to. At that time, I knew that the next level for us as a team was not necessarily adding more services or creating services that our employees could grow and learn. It was going to be building the franchise using the same systems that we used in our business to change it. P4P, open book management, the system that we created around estimating and sales. All of those processes I knew would change other people's businesses the same way it changed ours. And so I started developing the systems, actually putting them in paper. Really start talking about landscape business course on the podcast and sharing those with other landscapers on how they can make their business more profitable and run without them running on systems instead of their strong personality and letting go of the sales by year number six, I let go of now the sales role, giving that off to Lee and now Marcus has taken that position over. In terms of making estimates, super simple. Making the process of getting prices super simple. Making the process of getting an estimate sent out to customers super simple. That was the goal in year number six. Massive amounts of simplification didn't grow the revenues a lot, but I promise you, that's when the profitability began to really jump. That's when our growth was now sustainable. We didn't have to hire a bunch more people, didn't have to go get more equipment. We literally just made ourselves much more profitable and focused on those simple services where I did not have to show up to work every day, I didn't have to come into the office all the time. Liz, the office manager was managing everything. We had office assistants, we had the estimators, they could run everything and I didn't have to be there every day. Started documenting those things and those documentation of those systems is what later on became Augusta franchise. I realized that growing the business was not necessarily the end all be all getting a larger numbers, more employees, more trucks. I wanted a business that I did not have to show up to every day. A place where the employees felt like they could grow, they could learn, they could make more money using P4P. And then really that led into year number seven when I literally am not at the shop more than an hour or an hour and a half every week. But year number six was the turning point really creating the systems, documenting those systems for other landscapers. And that led us on to really be able to scale up in year number seven. So in year number seven we were able to continue growing locally at this shop. We also started a Second quarter owned store down in Mount Vernon. But year seven was really all about the franchisees. And we've grown up to almost 30 locations around North America using the systems that we really had learned in previous years and what not to do and what to do. So in year seven, having command center where we have office folks that are answering the phone, sending out emails, sending out estimates, really handling a lot of the office work, and then being able to really, again as an owner myself, stepping 100% away from the operations of the business, not knowing, having any idea of sales that are coming in, any idea of jobs that are being done, it's all being run by the systems, by the people that have been put in place on the team. In year number seven, we started profit sharing and really began to focus on the team, the culture, having meetings that had nothing to do with our business, but just trying to educate the team on their own careers, their future, and teaching them about business, teaching them about marketing so that they can set themselves up down the road, whether it be at Augusta and owning their own business as a franchisee or if they go on to do something else, something in a world that they're really passionate about, just giving them the skills that are really. I really feel like being unselfish with your time as the owner at this point in the business is very important, not only for culture, but also because if you set them up for success and they feel like they are being invested into, they're gonna invest back into the business as well. And that's what we've seen even this year where we have not had the massive exodus like we had in year number five and six. And we didn't have that massive turnover with P4P, with profit sharing, with open book management, where we share the profit and loss statements, where we go over those numbers and educate, not just showing them the numbers, but showing them why, how what happened, like what were the decisions we made from a business standpoint that led to that profit and loss statement and really trying to educate them in business professionalism and the things that are going to really be tangible assets for them in their career as they move forward. So year number seven, we'll do a little bit over 1.6 million in revenue. Still being able to grow this year without having to invest a huge amount in massive amounts more of equipment or trucks or people. And we continue to continue to grow at a very good pace. That's more sustainable, 10 to 15, 20% a year without having to have massive changes in the business because the systems are in place, they can scale up with Command Center. The amount of calls and leads that are coming in, that can scale very easily. And that's really the model we want for the franchisees everywhere. From Mount Vernon, which is a smaller location that we started in the seventh year, or if it's a larger location like this, it can scale all the systems scale, whether it be P4P, whether it be the Command center. Those are the things that you really want to focus on. And now me personally, I mean here maybe I come here for Monday, Wednesday and Thursday morning meetings for about 30 to 40 minutes max. Other than that, I really have no connection or time restraints on this location. A lot of work that goes into that, creating those systems, but I really feel like I could have got to year seven in year three if I would have just had those systems in place prior. And that's really what we emphasize and try to give to the franchisees. Year 12 is always going to be difficult. You're growing really fast. But being able to figure out things like paid for performance and open book management, and having the software and the systems in place for automations for your sales process, and having Command center that can scale up with you, those are the things that would have allowed me to get to year seven in three years instead. But at the end of the day now we focus really on simple services. We've gone back to the basics of mowing and basic trimming of bushes and basic maintenance and recurring services, trying to stay busy throughout the winter. We with recurring services that's not plowing and not requiring us to do big projects. And we're actually right now selling even more larger equipment and trailers and going to trailerless setups. In the past couple years, really trying to focus on simplification, getting a new hire that's able to get up and running and efficient and profitable within a matter of days instead of a matter of months. And the more complexities, more services you offer, more equipment you require them to know about you, just make it harder and harder to train and get employees to become profitable. And so by simplifying the systems, simplifying the processes, simplifying the services, you're able to make a place where people can come to work, make more money without having a huge time restraint on the time it takes just to train them. That was year number seven. Let's wrap it up with some of the takeaways I want you to take away from this video. So as you grow your business, don't think about revenue numbers, how big it is, how much money you're making. If you made a million dollars. It's not about that. It's not how many employees you have, how big your trucks are, how fancy your equipment is. Trucks like this five, six thousand dollars. We paint them. They're simple. The services we do, they're simple. They're not exciting or incredibly difficult or complicated. And highly skilled. It's simplification. That's what we want to focus on. That's what's going to allow you to become profitable. And more importantly, that's what's going to keep you from having to be in the business all the time. And you can focus on working on the business and perfecting those systems and helping your team get to the next level in their careers and developing that culture. That's what's going to move the needle for your business. When you get to a sizable amount of revenue, stop focusing on, like, how big your trucks are, how many number of employees, how much revenue you're growing. Those are just absolutely, completely pride boosters and great for your ego, but absolutely nothing to your bottom line. Focus on profitability, focus on simple services. There's nothing exciting about necessarily the services we do. Our employees aren't excited necessarily about mowing lawns or trimming bushes or, you know, pulling weeds, but we are excited. We're very passionate about the, the level of professionalism we can bring this industry. We're very passionate about being able to improve ourselves every day. Listen to, listening to the audible program, listen to audio books and podcasts, and improving our financial IQ and the things that we're trying to learn and become better human beings and better professionals and better at business. And that's what we get really passionate about. We don't get so passionate now about the type of work we do, the before and after pictures, the big equipment that we want to take a photo with. And that's not. Those flashy things don't pay the bills at the end of the day, simplification of services, sticking to your core competencies and then getting really, really good at those systems. That's what leads to a profitable landscaping business. This is Max, our mascot. He's our dog. He's our mascot for the, the franchise. And, you know, if there's anything that Max has taught me about marketing, it's that again, simplification. You don't need to have a whole lot of no fancy terminology and packages and pricing methods. Everyone, when they think about Augusta locally, they say, oh, are you guys. The guys with the yellow trucks and the dog? That's all they think about. Again, it's simple. They don't think about. They don't ask. Oh, yeah, do you have that toro mower or do you have that certain type of track loader? Those trucks like I like? No, a yellow truck with a dog. That's all the customer cares about. That's all you should care about. Simple, simple, simple. Keep things simple in your business. It leads to higher margins, more scalability, and most importantly, you can have your life back to work on the business instead of in it. I'm Mike andes. Check out landscapebusinesscourse.com I hope to see you at Landscape Summit in January 2021. We'll see.

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