How Much My Lawn Care Business ACTUALLY Makes (Detailed-Breakdown)

Hey everyone, it's Mike Andes and you're listening to the Landscape Business course. And today we are going to be showing some financials of Augusta Lawn Care of Whatcom county, which is the first location that I started about over six years ago now. And we now have 20 locations around North America that are franchise. If you're interested in joining the franchise, check out AugustaLawcare Services.com franchise. You and I can have a conversation and see if you're a good fit. But today it was really interesting because I was literally going through my email and I was going through some financials because I was trying to find some P and Ls and things that I needed for the bank and I'm in the middle of, I'm in escrow on some properties and so I was going through and trying to find stuff and one of my P&Ls from five years ago popped up on my email that I had sent to my accountant. And so I figured it'd be a good video to be able to show you all what I did when I first started my lawn care business and then now what that same location is doing. So if you followed me for a long time, you'll kind of understand these more. But let me try to give a little bit of background and things like that as I'm showing you the P and ls. So what we're going to do is go ahead and jump right into it. I'm going to show you my first full time year in business and then I'm going to jump forward into last month at the current location and I'll give context and try to give as much clarity as possible. This is kind of my first time ever showing financial reports, so I'm kind of dipping my toe in seeing how it works, seeing kind of the response that I get and seeing the positive, the pros and the cons. I did a survey on the YouTube channel and 75% of you said you would like to see them and it would help you. So I'm doing it for the 75% of you, the other people who didn't think it was good. I see all of your valid points and, and the only thing I would recommend that you think about before you post some nasty comment in my videos or anyone else's videos is first of all, would you show your profit and loss statements? Because if you wouldn't show your profit and loss statements for the entire world to see, you probably shouldn't like pick apart other peoples who are trying to help others. Just my POV that goes for any youtuber that's trying to help people publicly. It's not easy. So let me go ahead though, jump into the computer that I'm looking at. You're going to see as I'm clicking around and I'm going to show you the P and ls. So this is actually on Lawn Pro. This is the software that I started my business on and started the local shop using. And I would recommend it until you're, you know, you're sizable. But it's definitely not what I would use for automations, anything like that down the road. And there's just a lot of pieces of it that are better for smaller businesses, not bigger business. I've talked about that before. Look it up on just putting landscaping software. Mike Andes I talk about it all the time, the pros and the cons and what I would use. So this is 2015. This is the first year. Let me zoom out a bit. My computer here so you can see everything. This is the first year that I was full time. So actually before we look at this year, why don't we go back to 2004 when I was part time. So if I go back.

Here we go. So I think I started in like March. Let's just do from the beginning of the year and let's go to the end of the year. So this 2014, December 31st. There we go. Apply.

Okay, so this is 2014. This is when I was part time. I was working as a part time personal trainer at the local gym, which now I own. But at the time I was working part time there. So you can see I started in May. I still remember that. This is crazy. I could go to all sorts of stories here. I'm gonna just go down to collected. So you actually see what money was actually came in. So you can see here I started off kind of part time in the field. Obviously I was doing all the work, doing part time with the personal training. This is the first year in business. You can see truck maintenance and costs. I bought the truck so that was a big expense that first year. Did quite a bit of marketing, did, you know, kind of punch things off. And I did every door, direct mail, I did a flyer in the newspaper, got a little bit of equipment maintenance that first month anyways. But you can see, so that first year I was doing it part time, I did $30,000, a little over $30,000 in revenue. And you can see I lost, if you look at the net profit here, I actually lost $1,000 that first year. All right. And so a lot of that has to do with, you know, buying the truck. Let's see here. There must have been. Where's the equipment? New equipment. Yes. That $2,000, that was ET1, what is now called ET1, which was an enclosed trailer one and it was a used 6 by 12 trailer. And what's actually funny, this is coming full circle because we actually are just selling that this next couple of weeks. We're getting rid of it because we're getting rid of enclosed trailers. But you can see that's what that main expense was there. That was the trailer, that was the truck, that was the marketing stuff. And then inside of this new equipment was probably the mower blower, like basic other tools like that. So that's kind of interesting. That's my first year. Started to make a little bit of money here in the middle of the year in August because I wasn't having to do a bunch of marketing. Didn't have much equipment, tools or anything like that. You see, my expenses are pretty minimal. And so even though I only made 3,900 bucks, I profited three grand. 75% profit margin. That's what I'm talking about, baby. So, yeah, it's really interesting. No, no employee wages. Really. Besides this occasional. Looks like someone helping me. I think this is my, probably my sister helping me occasionally she would, we would literally cold call out of the white pages. It's just crazy to get started. So that's probably what honestly what these numbers, these small employee numbers are there. So that's interesting. Very, very cool. Let's go to the next year, though. This is what I had it on before. Let's go 2015. So this is now a little over five years ago. Let's see here. January. Whoa, here we go. January. January. And if you like this content and you want me to share more of this, the kind of behind the scenes personal financial information, go ahead and comment and share this video. I'd really appreciate it if you comment. Let me know if it helped you what it helped you on or say it helped me. Like what, what did it kind of clarify for you? And maybe I'll make more of these and go more in depth on all my businesses and maybe make it more of like a quarterly thing. We'll see. All right, so this is 2015. And again, we're still in Lawn Pro and I scroll down to the collected part. It's actually money that hit the bank account, not just build out. All right, so you can see here, this is when I went Full time. So I went full time like right in here, like February 2015. And you can see started to grow the business and then let's see, employee wages. Yeah, I got my first full timer like right in here. Full time person, like right in June, July when it started to really scale. You can see what happened when I went from myself down here just starting probably getting someone started part time. And then when I got a full timer, just how much it just grew just so quickly in terms of top line revenue. So literally went from 8000 in March, which is the beginning of our season, to 27,000 in September. And and see here again, just kind of consistently putting money into marketing. I kind of got a February, so like before the mowing season push. And then I did one right before the second fall push for mowing, which was in August there. So as well as in October. So that was interesting too. So this is 2015. You know, feel free to take, you know, stop the video and look a little bit more at this. But you can see basically I got my first full time employee. That was the big step in year two. Here, right here you can see getting the full timer versus here having like a part time, you know, help and then a part timer, oops, sorry there he had a second job and then he joined me full time here in July. And so just seeing that impact on the revenue is kind of cool. So yeah, definitely, if you're just getting started, and this is what I would say, if you're getting started like as a franchisee, this is something I'd be trying to get you to do this in your first year because you're going full time on it. Going full time is definitely what separates you in terms of revenue, what you can make just because you have so much more time to spend on the business and that you can see just so it's so evident in May going up to 12,000 and then just consistently growing. After I quit my part time job, it was like in March and April. I know I started off part time and I was like, you know what, I'm just gonna go full time. And then really started to ramp things up. So that's really interesting. Let's see anything else that jumps off here. So tools and supplies. Bought some tools here and here you can see where is. Yeah, this is interesting. So if you see here, Lincoln Road rent and improvements, this is the old shop that we had in Blaine. So Blaine is a really small city, has like less than 8,000 people in it. And we grew the business significantly, like over A million in annual revenue before moving to a larger city. And that's why I always push people like, you do not need a massive territory. You want to stay tight. And when we did marketing, everyone knew who we were because it's such a small area, you can market everybody, and they know it's just really good brand penetration. And so you'd rather be a fish in a small pond than a fish in a massive pond. And so I really recommend that. But when we were in Blaine, this is when you can see here in August is when we actually got the shop. So there's a significant amount of expense here that started going into rent and growing the shop out. And that was basically due to the fact that there was nowhere to store my trailer because. Cause I was currently, at this point, living with my parents at their house, and so I couldn't park my truck and trailer there. I had to go park it at a storage facility. Well, now we got, like, a second truck and trailer, which I imagine if I look up into truck cost. Yeah, exactly. So in July here got a second truck and then probably a second trailer and then a mower. I'm just highlighting those expenses and their truck maintenance and costs. Oh, no, this is all just truck. So there must have been a truck two and truck three. Three here. And then possibly a mower and maybe another trailer here, probably. So you can just see we started to really grow in the middle of the year there. And then we moved to that Lincoln Road shop. And so that's why there's that $7,000 spent on getting that truck, that shop going in terms of the office and the bins for material and all of that good stuff. So, yeah, this is really interesting. This is five years ago. This is 2015. You can see up here in the URL the whole year. Hopefully, that kind of gives you an understanding, like you could. Every single P and L tells a story. So that's what I'm trying to pick apart. Live here and seeing what. So, for example, like licensing and insurance, you can see here, like, there's not much licensing and taxes, but then at the end of the year, I had to pay my sales tax because it was annual. As your business grows, they'll usually move that to quarterly, and then they'll eventually move it to monthly, where you got to pay your sales tax every single month instead of like this. In this case, at the very end of the year. And I still remember this because I was not. I wasn't really used to paying taxes and sales taxes and everything. And like keeping money set aside for sales tax. And so I was really like, at the end of the year, if you take that 13,000 away from this number here I was having a really strong December, and then all of a sudden it's like, oh, by the way, you gotta pay your taxes. And for this smaller business, you do it for the whole year. So if you take, in our case, it's 8.5%, 8.5% of my total revenue collected is, you know, somewhere right around that number, I'd been paying pieces of it, I think B and O. I forget, don't take my word on this one, but basically I think I was paying B and O consistently. But the actual sales part to the government, the state, I don't think I had to pay to the end of the. Of the year. But basically that was my sales tax bill at the end of the year. So definitely got used of saving for taxes. And I think the next year I went to quarterly, and then the year after that went to where they bump you up to monthly once you hit a certain amount, revenue amount. But yeah, interesting stuff. This whole. The whole P and L tells a story, whether it be hiring, whether it be taxes, whether it be when you got your trucks, when you got your mowers, all that good stuff. So now I'm going to jump forward. I'm going to show you every single year don't bore you. I want to jump forward to last month at the Bellingham location. And so this is the. This is the stuff I haven't shared much of in the past. And there's several reasons why I haven't. And I think I made that clear on the survey why I haven't. Like, for example, now we do profit sharing at the local shop because I'm not there every day. I'm there maybe two or three times a week. Three times a week on Monday, Wednesday and Thursday morning, we have meetings and team meetings. And so I go and meet with them, meet with the managers, but I'm usually not there more than an hour. And so because of that, we do profit sharing. And. And so it's really kind of interesting year. It's been five years and this year I'm hardly there. But yet it's the year I actually start taking a significant profit sharing myself and using that money for the franchise and for things we're trying to build for the franchise in terms of software. And so it's really kind of a very interesting. It's like the least amount of work that I'm actually at that Location, but that's what I'm actually cashing in. But you can see here, you know, year one, two, I was not making really any money. You can see executive salary again, another piece of the story. I started paying myself this $800 a week salary. I think it lasted like six or 12 months. And then I decided that it was coming at the cost of growing the business. And so I stopped doing it. But anyways, basically I've made, you know, this year probably more money from the local shop than I have in the past five years combined. And the reason for that is just because the business has got to a place where it has systems, have other people managing it, it's much more profitable. And so let's jump into last month's financial statement. P and L at the Bellingham location. I'm going to try to give some clarity around these numbers. And again, you're only seeing a snapshot. You're seeing one month. So don't pick it apart too much. But hopefully it'll help either inspire or give you some guidance. So now we're in QuickBooks here. So now we don't use Lawn Pro anymore. We use Service AutoPilot, and then QuickBooks we use for our exp tracking. And so this is August 2020. I try very hard to make our profit and loss statement as small as possible. If you can start getting 50 different types of expense line items, it starts to get very hard to keep track of. Whereas, like with ours, we have maybe 10, 15 line items in our expense categories, and I can almost memorize them every single month. You can basically ask me, what did you spend last month in X line item? And I'll know it. But it's only because there's only like 20, 15 or 20 to remember. If you have like 40, I just really encourage you to consolidate them. Like, you don't need five different types of equipment maintenance. Like equipment maintenance, small, small equipment, equipment maintenance, trucks, equipment maintenance, mowers. Like, just do it all into equipment maintenance or into something like that. And I know some people are gonna pick this apart and say, I need to pull stuff apart. I get it. This works really good for me because I'd rather know my numbers in terms of just being able to remember them all the time. And so this is the local shop again, this is Whatcom County. This is not the franchise. This is the local shop that I do not manage. It's managed by Liz and Lee primarily. Marcus is the new estimator. You know, there'll be more information on that down the Road. This is kind of a transition they're going through, but I'm not there very much. And this is what they've done. And they're awesome. The people managing as well as the team there, they'll really, really good about the team that is there. Just really privileged and blessed to have some really awesome people. And so this month is the first month we actually did profit sharing for everyone, including the field workers on top of P4P, which, if you don't know what P4P is, it's pay for performance. We talk about landscapebusinesscourse.com, where you pay your people by a percentage of revenue that they make for the business instead of by the hour. And so we've done that for a while, but we just started this month is profit sharing. We're quarterly. We give profit sharing to the field workers. And they still. I don't want people to feel entitled to profit sharing. So what we do is, even though it's profit sharing for the field workers, they still, if they show up late, if they show up late one time in the entire quarter, that profit sharing gets halved for them. And if they show up twice late or unexpected, what's it called?

An absence. Like, it's like unexcused, tardy. An unexcused absence. If they're late or unexcused absence one time, it halves their profit sharing. And if, if they do that twice, they get no profit sharing for the whole quarter. And some people think that's a little bit drastic. But I'm a big believer in showing up on time, supporting your team and your crew, and not letting them down by being late. And so it's kind of my way of also making them feel like they earned it instead of it just being like a handout. Excuse me. So I don't like profit sharing as like, oh, everyone gets money. And it's like Oprah. You get money and you get money, and you get money. I want it to be where they. At the end of the quarter and they get the extra money in their paycheck. They're like, yeah, I earned it. I was here every day. I was on time. I didn't call out two minutes before I was supposed to be there. And so that's what I want. I want them to feel like they earned it. And so now at the local shop, 27% or so of the profit is distributed to the team. By the time you look at managers and estimators and people out in the field and all the rest of it So I really like that setup because I want people that are working there every single day to be super incentivized, to keep it profitable. Because I'm not there. I'm not managing the people or the jobs or anything there. So really, really blessed to have an awesome group of people there. Wouldn't be able to do it without them. But this is the profit and loss statement from August 2020. As I get more brave with sharing my numbers, I'll share more in terms of like outside of just this one month. But let me just start with this and you know. Yeah, so you can see here we kind of group all of our income into service income in QuickBooks. But in in service autopilot, we have a very detailed breakdown of where that revenue is coming from in terms of service types and things. So again, just keep in mind that this is not the further we get this broken down. A lot more on the revenue side inside of service autopilot. But when the money comes into QuickBooks, it's just all lumped into service income. Just for the sake of simple reports. I'd much rather have a simple report that I can remember than a complicated report that's super detailed and accurate. But I don't, I don't understand it or don't remember it. So this is our profit and loss statement. Total income just short of $200,000 for the month of August.

And for those of you who do not know our market, we are in the Pacific Northwest. So August is our hottest month. This is in this month. We have a sharp, not sharp decline. We have a bit of a decline in mowing just because people go to bi weekly schedules, et cetera. And so in August, I would say that's probably our highest percentage of revenue comes from landscaping and cleanups just because mowing dips a little bit. So 199 in revenue. That's pretty good for this month, especially due to the fact that we actually reduced our labor force a little bit. And so we had very, very efficient people out in the field during the month of August, even though it was our hottest month. It's not necessarily the easiest time to work. And the mowing does decrease in our revenue breakdown. But we had, we didn't really add a whole lot of people in August and in June, July, even though we had more jobs, the fact that we added, had added like three new crew members in July, I think was. It slows people down. It slows the high performers down. Cause they're the ones that are doing the training. And so you Just get a less efficient cruise when you start adding new people. But it's part of growth. And I've always said growth sucks cash. And part of the thing that people don't think about is that adding new employees does cost you money because they're less efficient and then they slow down. Your really high performers who are usually making a bunch of money but now need to train those new people. So anyways, a 199 revenue, again, you can see kind of the breakdown. You can see this 2400 in marketing. Honestly, what was actually effective for the local shop was probably like 500 bucks. The reason that we spend money at the local shop and advertising on pretty ineffective things is because we're testing things out for the franchise. So I do this in at the Bellingham location as well as the Mount Vernon location. One, the Mount Vernon location is small. This one is a larger location, the Bellingham location here. And we do that because I'm able to test what works. Like whether it be next door or Facebook or Google or like this month we tested some Snapchat stuff like just seeing what works. Guess what? Snapchat did not work well. I wasn't expecting it to. I didn't think it was going to do well. It did not do well. But I want to test it for the franchisees. And so that's why we keep the Bellingham location and the Mount Vernon location. We have one big location, one small location. And I can test things out, see what works. If there's differences between when you have different sizes of business. So that's really what that expense was. That's something that probably would have been cut out otherwise if I wasn't in there tinkering and trying to learn for the franchisees. You can see a breakdown here. One thing that is kind of to keep in mind here, and you'll see this if I ever share more months, is this number. The net income that is higher than usual. Because if you look at this number here, it's like 30% profit. 30% profit. And that is higher than usual. So full disclaimer there. Higher than usual. Simply due effect. A few different things. Number one, like I said, we weren't hiring and adding a bunch of trucks and equipment. The only thing we bought was here on truck and equipment costs. We bought a dump trailer for just under $10,000. Brand new, 7 by 14, has a solar charger on it, like fully decked out. It's yellow. We have a custom color on it. So like we paid pretty penny for that. That was our Fourth one. And so we get those from load trail, really like those it. And so that was the only really equipment expense that we had in the month of August, besides a push mower or two, I think a 30 inch push mower. But that expense here is.

I guess that's the only new equipment that we bought, a new asset. The thing that is different on here is the fact that our payroll was in this month we didn't do any profit sharing. So next month, because this is the end of the quarter for them, they would actually get profit sharing. And so this payroll is lower than usual. And that's why our net income, the percentage of profitability is higher than usual. Like Our goal is 20% profit to be at 30% is higher than normal. And that's because in this month we didn't do any profit sharing. We do that on a staggered quarterly basis. And I'm not gonna get into that. I'll talk about at conference how we do profit sharing for those in the field versus managers and why we do it in a staggered fashion. But I'll talk about that. More conferences and not the video for that.

So you got rent, utilities, shop expenses. Includes everything from like Internet to toilet service to trash, the whole nine yards. Again, you're not going to go get this when you're smaller. When you're small, you know, doing under half a million revenue, you do not need to spend $4,000 a month on rent, utilities and shop expenses. But one thing you'll notice is I kind of, I group all of those things into one line item on my P and L. Could I break those apart if I need to for taxes? Absolutely. However, the reason I do it like this is because I want to be able to see in one page my financials. And this is the best way to do is group those expenses into really simple expense categories that you can memorize that you can really keep track of and know very quickly. You can see fuel expenses, credit card processing. People freak out like, oh my word, you spent almost $4,000 in one month on credit card processing. Yes, but we literally collect 95% of our payments the day we are within like a couple days of, of billing. So I'd much rather have that really tight cash flow. Back in 2016, when we were doing, you know, less than 25% of the revenue here, I remember getting a, our accounts receivable up to like 80 or 100. It was 80,000. I remember one time went over $100,000. Our accounts receivable, what people owed us. Now that does not go over like 15 or 20,000, even though we' five times bigger. So by having credit card processing, it's helped a lot. Yes, it costs money, but I promise you, I don't want to have to float $100,000 in working capital because of. Of all the accounts receivable. So that's something that we just pay. You can see taxes. We do pay taxes. We do still pay sales tax every single month. You can see that. Tools and supplies. You're not going to get around that. For the landscaping jobs, a lot of that is what that comes from employee other. This is like uniforms, advertising, marketing. I went over that one.

Office and software. So this last month we are doing a transition where we are moving the old estimator into the office manager position. And the office manager that's been there for a long time is going to be helping with the franchisees. And we're kind of moving Liz, who's the old office manager, moving into more of a role where she's helping with the franchisees as well as still at the local shop a little bit. So she kind of splits her time between the two. And so that transition has been going through. And because of that, they've been getting some computers and office equipment and dividers and things like that. So that way she can have kind of have a separate office. And then we've been. We moved Marcus into Lee's position, which was the estimator. So they kind of all moved a little bit of shifting up in the chain of command. So that way Liz can help with the franchisees a little bit part time. And that's afforded by the franchise starting to grow and being able to afford that. And so as the franchise can afford it, we try to pull more and more resources, more and more resources towards it. And so maybe one of these days I'll show a breakdown of all the monies between all the different companies. Maybe for August we'll see. Maybe the next video will be kind of August P and L for all the companies that I run. But I hope that was really helpful for you all. If you have questions, comment below. I know there'll be lots of questions, so like just comment below. I'll try to get to as many as I can. If it was helpful, tell me what was helpful about it. So that way when I do a whole year or I do multiple businesses that I have and I show the profit and loss statement, like, tell me what was helpful, tell me what was useful, and it might convince me to share more. So I'm A little bit wary. I'm not into doing this. I'm not doing this because I'm trying to say how much money I have or like a brag or anything like that. I hope this helps you, inspires you can maybe correct certain parts in your business that you look at and you're like, oh my word, I spent like way more than that in a certain area and I'm half the size, something like that. So don't share all these numbers to say, hey, we're the biggest or the best or anything like that. There's companies that do millions of dollars in revenue every single month. So it's not about how big we are. I hope it does a couple things for you. Number one, I hope it inspires you. If you are in that first year, maybe your first part time, you saw like I did $30,000 in that year just doing it part time. And it can grow. And if you invest the money back in the business, you continually focus on systems and procedures and you're now five years later, you know, from 2015 to 2020, we're doing what we did in a whole year, we're doing in a month. And I spend significantly less time at the. Working on the business, working in the business, spending time on it whatsoever. And I make a substantial amount of money in profits. That doesn't come without a lot of hard work. Like somebody like, oh, well, look at me now. Even this is something I worry about now. Even like employees coming in like, oh, like, because they, I share these numbers with them. So they'd be like, oh, like there's all this profit, he's making all this money. What they don't see is the five, six years of, you know, just plowing money back in the business, working not just three days, you know, popping in for meetings, but like really, really working hard, you know, working through allergies and all the rest of those first few years and I was working out in the field and so they don't see that. They don't see not making any money, making less than what a minimum wage person would be making at a burger stand. And yet I was working 14, 16 hours a day on the business. Like that's, that's not easy for most 18, 19, 20 year olds as how old I was doing that. So, like, it's definitely something that I don't want to do this to try to brag or say, hey, look at me. I hope it inspires you. I hope it encourages, encourages you. If you're in those first couple years, like Man, I just feel like I'm just grinding through here. Realize that you can build a significant business with the right system, the right procedures and things like that. So I think like listening to the podcast, becoming a member of Landscape business course, joining Augusta Lawn Care as a franchisee, those are all things that are going to help you in your pursuit of a great business. And so I just wanted to say I hope I can share more of these. I hope it is helpful but please comment below, let me know what was helpful. And yeah, I appreciate everyone that's been with me from day one. I literally started this podcast and started just audio podcast. Now the past year or so has been video.

I started it and there's people that have been from day one that bought Landscape business course, became a member. Now they're franchisees. I still remember the first couple course members. They're now franchisees and they're growing their own business. And you'll see too like down the road maybe if I share all my years is the jumps that happens from year to year. It doesn't usually happen intra year. Like usually from like you know, March, April, it doesn't go up, up, up, it usually jumps each spring, right? So really going after that spring rush, capitalizing on is very important. And so hopefully you can see the struggles, you can see the pain, you can see the good things, the positive things. Just keep in mind that I don't do this in any way to bring attention to myself. I really hope that this you look at this inspires you. You can look at this and compare it with your profit and loss statement and begin to ask yourself whether or not your profit and loss statements and your financial statements are clear enough to see a very clear story like we've seen today. So anyways, hopefully you enjoy that comment below and make sure you check out Lawn Care web design if you want us to build your website landscapebusinesscourse.com if you want more information, training and learning about P4P and yeah, I appreciate everyone for all your support. Thanks so much and have a great day.