Mike Andes explains when to scale a lawn care business: wait until it generates so much cash you need to reinvest it. Calgary's market produces about a million dollars in profit yearly.
Calgary.
April 11, 2023.
At what point do you think we should actually consider expansion? Whether that be through franchising, corporate or an acquisition model. At what point should we actually start to really focus on that side of things?
Until it's painfully obvious that there's so much cash in the business that you're going to be paying the government so much money that you literally need to find a way to spend it.
Yeah, yeah. So like a cash machine. Once Calgary is a cash machine, it's just like wow, like every year it's always a million dollars in profit. Then okay, maybe the next thing.
But whatever the amount is, doesn't, it's irrelevant what the dollar amount is. Right. For some people, they think they're killing if they make $1 in net profit. Right. The bottom line is opportunities for expansion. Franchising, licensing, multiple locations will all open those, those doors will automatically open up. If you run a business, have a business model that's pretty able to predictively create 20, 25% profit margins on a million 2 million plus in revenue. Like if you do a 2 million dollar business that do 25% net profit margin and distributions, you will not have to think about what's next. It'll come to you.
