My Recipe for a 7 FIGURE Lawn Care Business... & $100,000 Take-Home Pay!

If people actually did this, they would change their business. My goodness.

Markers. Black marker, pink marker. Where's my red marker?

Hey, everyone, it's Mike Andes. I'm the founder of Augusta Lawn Care. We have over 50 locations around North America. And today I'm going to be sharing with you the recipe for step by step, numbers you need to know to grow a successful lawn care business. This is something I literally just drew up on the back of this invoice I have from my attorney. So I drew up on the back of this while I was on the phone, and I think it's really, really going to help somebody. It's basically going to give you the recipe to grow your business sustainably. And which numbers you need to track the key performance indicators or KPIs. You must know to scale your lawn care business predictably because at the end of the day, we can talk about marketing and all sorts of things, but you want to predictably know how fast you can grow your business. Today I'm going to show you exactly how to do that. Like all good illustrations, starts with the funnel. Okay? So I always like to work backwards, whether it be how big you want to grow your business, how much profit you want to get out of your business, work backwards. The same way that I look at investments and I look at what's my, what do I want to have in free cash flow. And I work backwards how much I'm willing to pay for the property or how much I'm willing to pay for a stock and what I feel like the, the market value is for that same thing I think should go for your business. Look at as an investment, look as a money machine. Let's just assume at the bottom of our funnel, we want to have $100,000 in profits. Net cash flow. Net cash flow. Okay, like money in your pocket. And we're going to, we're planning to grow our business. And maybe you're at zero and you're trying to get 500,000 a year growing really quickly, or perhaps you are wanting to go from 500,000 to a million. We're going to assume, though, that we want to grow by $500,000 in new revenue. So again, if you're starting at zero, this would be okay, first year, I want to make $500,000. That's a big ask. That's a lot. Very, very difficult to go from 0 to 500,000. Typically because you're spring, you're not going to be hitting 50, 60,000. You're going to be getting, you know, 20 then 30, then 50, then 60. It's actually very difficult to hit 500. But I'm just using the sake of the easy numbers. So you can use these numbers however it is for your business. But I'm going to use 500,000 just for the sake of ease. So now we're going to assume over here we have KPIs. We're going to assume that we have $2,000 per client. We're going to assume that every single one of our clients on average will make $2,000 in revenue from that client. Okay, so another thing that we've kind of already inferred here in terms of KPIs, as I'm writing my KPIs over here, key performance indicators. So we already have $2,000 per client. We'll talk about that in a second. But I'm also assuming right here that 20% but profit margin. Okay, so that's my target, that's my KPI key performance indicator. And that's gonna allow me to have 500,000 revenue and come up with net cash flow of $100,000 in my pocket. What's implied here though is I'm have $2,000 per client. I'm gonna sell the mowing all year round. I'm selling a molten installation or a bush trimming. Now this is average. Okay. So that means you're gonna have some clients at 3,000 or 4,000 because you sell them treatments and core aeration and overseeding. And then you have some clients that are like, you know, 1000 or 1200 because all you sell them is mellowing. So I'm going to assume $2,000 is the average value per year in revenue of the client. Okay. So in order to hit my $500,000 in new revenue, I'm going to have to get 250 new clients. And we kind of did a little bit of this on an Excel spreadsheet in the last conference. By the way, you should definitely sign up for Landscape Summit 2022. We're having a January in person conference. Fantastic. So we have to have 250 new clients and they all average 2000 doll in revenue for the year. We're going to get that. We're going to hit this goal. Okay, well, let's go ahead and assume another KPI, which is the fact that we have a 50% close ratio. Okay. So these numbers on the right hand side are the main. This is the big deal. This is the stuff you have to keep track of. This is the thing that you must know in Your business if you're actually going to achieve the money machine. So 50% close ratio, if we assume that that means in order to get the 250 clients, I'm going to have to get 500 estimates. I'm going to send out 500 proposals, quotes, whatever, in order to get those 250 customers, which will in turn give me $2,000 per client, give me my total revenue, implying a 20% profit margin, which is fantastic. I'd get $100,000 in net cash flow. And a lot of times, you know, everyone's like, well, that's impossible to grow from 0 to 500,000 and have $100,000 in profit. That's true. You're probably gonna take some of this 100,000, buy more trucks, keep investing back into the business. But eventually down the road, the goal is that this goes in your pocket. So, 500 estimates, what's gon. So now let's break down the math, because everyone, this is all ethereal and great in theory, but the question is, what do I have to do, what I have to put in the top of this funnel? What action steps can I do today to actually make this outcome come at the bottom of the funnel? Again, we're going to another key, kind of key performance indicator you can keep track of is how many days that you work out of the year. And so obviously we're going to assume, you know, we work five days a week for eight months out of the growing season. Just assume that. We're going to assume that we don't do estimates in the winter months just for the sake of this example. So that would mean that if we worked eight months and we're five days a week, 20 days a month, that we'd be working times that by 8, 160 days in the year. Okay, so again, 8 months, 20 days per month that we're going to work and do these estimates. That means that I have to do 3.125 estimates per day. Again, I'm just doing the math. This is very, very basic. And the bottom line is you can control these things on the right hand side, these are just outcomes. Okay? But knowing this math is something that's going to give you the magic number of what you need to do at the top to actually make this outcome a reality. Again, 3.125 estimates per day, not too bad. If you need a little over three estimates a day during the growing season, I could get literally 100,000 in my pocket, that is, or 500,000 in new revenue. However, you Want to look at that? Okay, well, what do I need to get to the 3.125 estimates? Because that's great in theory, but how do I do that? Let's go ahead and assume a CPO, or cost per lead over here as $60.

Per lead. Okay? So cost per lead is $60. So because I know that math, that means I can accurately predict exactly how much money I'm going to need to put in the top of this funnel. I'm going to have to put exactly $187.50 per workday. Okay? So this is not assuming that.

The weekends or the winter months, but if I assume that I work 160 days a week, I have three estimates per day and I have $60 per lead, it would mean that I have to spend $187.50 per working day. That also equates out to $937.50 in marketing dollars per week of the growing season. This is not including the winter, so you could spread this out, et cetera. But the bottom line is, if I want to grow by 500,000 revenue, and I'm going to have a $2,000 value per year per client, which is actually pretty average, if you look across your client base, that's going to give me 250 new customers. And in order to get those 250 new customers, if I have a 50% close ratio, I'm going to need 500 estimates, and I'm going to do 500 estimates on working eight months out of the year and five days per week. I'm going to need one hundred and sixty work days, a little over three estimates per day. So I'm not going to do one estimate a day or two estimates a day, I'm going to have to do three to four estimates a day every single day in order to get that much lead flow. If I don't have brand awareness, I don't have people calling me organically and I'm trying to, like, really push my business forward, I'm going to spend $187.50 per workday or $937 per per week in marketing. That's a lot of money. Okay? There's a lot of money. And I think so often the times I'm pushing people to spend money on marketing because people don't understand just how powerful the return is on this money. Because I agree that if you'll buy four months, four and a half weeks, or sorry, four and a half weeks in a month, and you spend literally $4,000 in marketing, I understand that is, that's extremely frightening, especially in the first couple months when you might only do, you might spend 4,000 on marketing. In month one you make 10,000, then next month make 15,000. It's very, very frightening if you don't have that kind of money. All of this is to say that you probably aren't going to grow a $500,000 business. The numbers for you are probably like maybe 200,000 or 300,000. Again, this is new revenue. So if I'm at 500,000 now and I want to go 700,000, just change the numbers. Okay, well if I want to do $200,000 in new revenue and I want to be 20% profitable, well, that's going to mean that this is 40,000. And just work the numbers backwards. What are your KPIs, what are your key performance indicators? So what can you learn from this? First of all, your business is a money machine and you can accurately predict exactly how much you need to put at the top of the funnel in order to get the result. Your business is well streamlined and you know these numbers. This should be an absolute prediction. I keep talking about so much about these numbers and recently I know a lot of you have been commenting that I've been doing a lot of the whiteboard and talking more numbers because I just can't overemphasize when you're in a service based business like we have with lawn care, just how powerful it is to know that when I put this much money in, I'm going to get this much money out. But the problem is most people will stop hitting this money in the top of the funnel because they start to lose confidence. But if you have these numbers and you know what your close ratio is, you know what your cost per lead is, you know what your lead, your client value is, the value per year of your clients and you know what your profit margins are. This is absolutely possible to run a model like this and know what's going on. I encourage you to sit down every single year, ask yourself, what's the new revenue? How much do I want to grow this year? And run these numbers backwards. This is going to be probably a higher number than most of you even would need to spend in order to get this result simply due to the fact that you're going to have referrals, you're going to have people seeing your trucks, they're going to be calling you, people that are happy walking by a property, they see your property, you're working on they come ask you for a card that's you don't have to spend any money for them. This is almost like worst case scenario. But again, most people get disheartened by pumping in 4000 the first month, 4000 the next month, 4000 the next month, and they start stopping. And all of a sudden that's why they only get 120,000 in new revenue that year, because they just didn't stay committed over the course of those eight months to their funnel. It's all about this. The numbers don't lie. And when you know your KPIs, you simply keep putting money into the top of the funnel and knowing a predictable result. So I know these numbers are generic, but punch your numbers in here. Figure out what you need to do to get the new revenue that you want, how many estimates you need to have, how much you need to spend on marketing based upon your cost per lead. And some of these numbers are probably pretty generic that you could use in your business. And you can just adjust these at the bottom. So hopefully that was helpful. If you want to have more information about a lot of these numbers, check out landscapebusinesscourse.com if you want to grow your business and figure out marketing. Lawn caremedia.com is a great way to do door hangers, flyers, print media. And then if you're wanting your website built where you can actually, really, really reduce this number over here because you're paying a set monthly fee and we don't charge contracts. Just go to lawn carewebdesign.com and we can help you build your website. Thanks so much. I'm Mike Andes. We'll see you tomorrow. I'd like to invite you to Landscape Summit. It's the conference we have in January of 2022. Go to landscapebusinesscourse.com conference for more details. We talk about P4P efficiencies and how you lawn care and landscaping business. I look forward to seeing you there.