Learning how to edge cleaner lines or mix your fuel levels up your craft. But in this article we focus on 5 pro-level tactics to level up your business.
Good business owners are always looking for ways to optimize their business to increase profitability and minimize their losses. Lawn care is no different! While there are a lot of ways we can improve, we’re going to cover 5 pro-level tactics to optimize our lawn care business for maximum profitability.
Ready? Let's get started.
One of the most telling characteristics of a hyper profitable lawn care business is route density which refers to the distance between each job on your route. It might not be immediately obvious why that impacts your profitability so let’s break it down.
The best way to think of it is in terms of Effective Hourly Wage. Let’s say you charged $60 for a cut and it takes 1 hour to service it. Based on your service time, you’re earning a cool $60/hr which will beat out a job down at the local McDonalds any day of the week. However, what it doesn’t account for is the drive time to get to that property. In order to truly calculate what you’re earning, you have to divide the money you make by the total time it takes you to earn it which, unfortunately, includes drive time.
Assuming it takes you 15 minutes to get to the property, that adds on 25% to your total time bringing your effective hourly wage down to $48/hour ($60 / 1.25 hours). While $48/hour is still a great hourly wage, you just lost out on $12/hour which is the equivalent of that McDonalds job!
The solution? Tighten your route density.
Let’s say that same 1 hour job we mentioned above was right next door to the job before it on your route. Now, you’ve just eliminated your drive time since you can simply walk next door and completely skip loading up your gear in your trailer, driving to the next job and unloading it all again. You just rescued the $12 you lost on driving!
In an ideal world, your entire book of business would be on your own street, effectively eliminating all drive time. Obviously that’s not very realistic, but there are some tactics you can use while finding clients to keep a tight route and cut down on our overall drive time.
If you’re starting your lawn care business from scratch, you’re in a perfect position to build the tightest route possible. Imagine if you could wake up, hop on your mower and roll over to your first client - your next door neighbor - without ever having to load your trailer at all. This is actually crucial if you can’t drive just yet!
Even if you do have to load up the trailer and drive a few streets over, building a client base within your own neighborhood dramatically cuts down drive time and, if you plan it right, allows you to finish up your route closer to home.
You’ve already got customers? Great! But how do we tighten your route of existing customers? The answer is, we don’t. We simply build up a new customer base around the highest density of existing customers and slowly let go of our customers who are too far away.
If you already have a solid book of business, I know it can feel redundant or unnecessary to keep looking for new customers, but if you can cut all of your drive times by 5-10 minutes, you could be saving yourself $1,000 a month in drive time.
So how do we do this?
Let’s say you have a job on the west side of town every Tuesday and you have another job on the west side of town every Wednesday. Rather than driving out to the west side of town on two separate days, try rescheduling one of the jobs to the same day as the other so you only have to drive to that area one day a week.
Obviously this tactic is dependent upon customer preferences, the size of your city, how many customers you have and the frequency of service. But the general idea is still applicable: group jobs together by proximity on the same day to cut down on drive time.
The beautiful thing about technology is that it can crunch the numbers faster than we can. So let it help! With the Check app, you can generate a route in one tap and it will automatically find the shortest route between all of your jobs for that day. Even if your jobs are a little spread out, don’t worry - this is a great first step that will shave off a few minutes from your commute!
How do you take payments? Is it through cash or check? Venmo or Cash app? An app like Check? There are a lot of different ways to take payments and they all have their pros and cons. But one thing to consider is the amount of time it takes you to get paid.
With something like cash, there are two major downfalls. The first is that your customer cannot easily pay - a lot of people don’t keep cash on hand. If you’re waiting weeks to get paid for a job, that’s money you’ve earned but can’t spend. The second (less important) downfall is that you have to take that cash to a bank - that’s extra time on your calendar.
Using a digital payment method like Venmo or the Check app eliminates both of these problems by helping customers pay you quickly and easily using their debit/credit card and their phone as well as depositing the funds into your bank account without having to drive to the bank at all.
An additional benefit to accepting payments through Check is that it will automatically update your clients’ outstanding balance so it is always accurate. Definitely something to consider.
When it comes to lawn care, there are some tasks that you simply have to do even though they don’t make you any money. They’re just part of running a business. Tasks like invoicing, scheduling, routing, customer acquisition, bookkeeping, taxes and more. If you were to be paid for these tasks, they would add up to nearly $1,000 a month. Holy smokes batman!
How can we rescue that $1,000 worth of time? Technology. Thankfully, a lot of these mundane tasks can be automated, freeing up your time and improving your productivity.
Granted, we’re a little biased, but we’re building Check for exactly this purpose. To be the automated back office you need, right in the palm of your hand. To give you a small taste of what we can help you with, when you mark a job as complete, Check will auto-schedule the next job on your calendar, stop your timer, create and send an invoice to the client with a secure payment link, update your client’s outstanding balance to show what they owe, and increase your “Total Earnings” on your in-app dashboard. Yeah. That’s a lot. All with one tap.
It takes less than a minute to sign up for Check and only a few minutes to add your customers and set up your jobs. Within an hour, you could be on track to saving yourself $1,000 a month. Now that’s optimizing for profitability.
Pricing is one of those skills that’s both an art and a science. When you show up to a job, you’re taking in a ton of information: lot size, grass height, obstacles, length of driveway, dips and ditches, backyard gate width, route density, parking for your trailer and a million other little things. For many folks fresh to the lawn care game, this is one of the most difficult things to learn and you’ll underbid your fair share of yards before dialing in that gut instinct.
When it comes to profitability we have to make sure we’re pricing accurately, pricing competitively, and pricing systematically. What do I mean by that? I mean that it’s important to develop a system for pricing that allows you to consistently price a yard correctly so you don’t have to worry about losing money.
We wrote an extensive article on How to Price Lawn Mowing Jobs which I highly encourage you to read, but one fantastic method we’ve created for systematizing pricing is our Lawn Care Pricing Chart. It’s a one-sheet that you can print, laminate and keep in your truck or even access on your phone. Using it is simple - find the intersection of the Time to Complete (TTC) and your Target Hourly Rate (THR) and the chart will tell you the price.
Estimating the Time to Complete can sometimes be tricky, but we talk about how to use a Benchmark Yard to help you dial that in in the How to Price Lawn Mowing Jobs article I mentioned above.
Running a business without measuring your performance is like flying blind. You don’t know how you’re doing compared to last month, you don’t know if you’re hitting your goals… heck you might not even have goals. But if you’re running a business and are hoping for it to be successful, it’s important to keep track of things like your effective hourly rate and average Time to Complete for each yard so you can continue to optimize performance and make better business decisions.
We’ve actually touched briefly on effective hourly rate before when we talked about route density. Since you don’t work at McDonalds where you work for an agreed upon hourly rate, an effective hourly rate is how much you’re making per hour once you’ve finished the job including admin time (which should be mostly automated, right?) and drive time.
Here’s how you can figure out your effective hourly rate: Price of Job / (Time to Complete (TTC) in minutes / 60 minutes in an hour)
If the job took us 45 minutes and it took 10 minutes to drive there and we charged them $65, we would write that equation like this:
$65 / (55 / 60) = $70.90 Effective Hourly Rate
Not too shabby! Calculating your Effective Hourly Rate gives you a benchmark to know what you’re currently valuing your work at. Now, if you’d like to make more, you know you need to price a little higher the next time you bid a yard.
This one is pretty simple. Take all of your times (in minutes) for each time you’ve serviced a specific property, add them together and divide it by the number of times you’ve serviced the property.
Let’s say you’ve serviced the property 3 times and it took you 45 minutes, 52 minutes and 47 minutes respectively. We’ll add 45, 52 and 47 which comes to 144 minutes which we’ll then divide by 3 for an average of 48 minutes TTC.
Over time, you can watch your average TTC. If it drops, you’ll know that you’re getting faster at that yard and, as a result, have a higher Effective Hourly Rate. If it rises, then you’ll know that the yard is taking you longer and you are earning less than when you started.
For both of these calculations, you’ll need to know your Time to Complete (TTC) or how long it takes you to finish a job. Rather than guestimating or using a stopwatch, Check handles this for you. Simply tap the “Start” button on a job when you begin the job and the (you guessed it!) “Stop” button when you’re finished. We’ll store your Time to Complete in that job’s details so you always have it on file.