Greens Manicure Service’s competitive edge will be based on quality and professionalism. During the first year Steve will be doing all of the lawns with only one other employee. This provides him with direct supervision of the employee and direct involvement with the job. This will ensure customers receive a quality job. Steve knows what quality work is, based on previous experiences to be detailed under the Management section.
Greens second competitive edge is professionalism. Steve will ensure that all interactions between the customer and his employee, as well as himself, ooze professionalism.
Steve truly believes that professionalism and quality are the factors that attract and maintain customers. Consequently, Steve will be truly vigilant in ensuring that his competitive edges are always apparent to the customer as his livelihood is dependant on this.
Greens Manicure Service’s sales strategy will be based on one-on-one communications with prospective leads. Steve will first be leveraging his relationships with his parents (pillars in the neighborhood) and his connection with the neighborhood. The prospectives will generally form a bit of a bond with Steve because of local familiarity and then Steve will need to communicate his experience in lawn care and his constant benchmarks of quality and professionalism. Steve is willing to offer a free estimate and cutting for those that are interested in a possible contract. Although some of the free cuttings will not turn out to be long term customers, he is confident that his competitive prices and superior service will turn most of the leads into customers.
By year two, the business will be ready to expand outside of the neighborhood and Steve will be using advertisements in the local paper to generate business. When people call with questions, Steve will have already (the previous year) built up a loyal following of customers that will serve as an effective referral system in which prospective people can call the current customers and get a glowing testimonial of Green’s service.
The first month will be used to set up the office, purchase the necessary lawn care equipment, hire and train an employee. Additionally, during the last two weeks of the month, Steve will be canvassing the neighborhood to build up a customer list.
Month two will see some business. The business will be growing as Steve continues to increase the number of jobs that he has. Month two through October will see a steady rise in revenues. Business will pick up again in April of year two. From February through April Steve will be working hard on generating new customers and will bring on two additional employees to service the new customers.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Sales | |||
Suburban middle class | $41,748 | $91,254 | $97,854 |
Other | $0 | $0 | $0 |
Total Sales | $41,748 | $91,254 | $97,854 |
Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
Suburban middle class | $2,922 | $6,388 | $6,850 |
Other | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $2,922 | $6,388 | $6,850 |
Greens Manicure Service will have several milestones early on:
Milestones | |||||
Milestone | Start Date | End Date | Budget | Manager | Department |
Business plan completion | 3/1/2001 | 4/1/2001 | $0 | ABC | Marketing |
Set up the office | 3/1/2001 | 4/1/2001 | $0 | ABC | Department |
Signing up the 20th client | 3/1/2001 | 5/1/2001 | $0 | ABC | Department |
Revenue exceeding $50,000 | 3/1/2001 | 5/1/2002 | $0 | ABC | Department |
Totals | $0 |
Greens Manicure Service is owned and operated by Steve Greinthum. Steve was first introduced to lawn care while he was pursuing his bachelor’s degree in business from the University of Oregon. Steve worked for a large, well-respected landscaping company. He started out his freshman summer year as a mower operater. During his four years at school he eventually moved up to crew manager.
Steve enjoyed taking care of lawns. He was always excited about working outside. He also liked the management responsibilities that he had his last summer. The one thing he longed for is operating his own company. He decided the only thing stopping him was money, he already had all the experience and knowledge necessary. So Steve got a loan from his parents and started the company.
Greens Manicure Service will consist of Steve working full time. Steve will be the manager for the business, signing up new customers, managing customer accounts, hiring, training, supervising, and cutting grass.
Greens Manicure Service will use a total of two people during year one. For year two Steve will hire an additional two people to create a second work crew.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Steve | $22,500 | $22,500 | $22,500 |
Employee 1 | $12,800 | $12,800 | $12,800 |
Employee 2 | $0 | $12,800 | $12,800 |
Employee 3 | $0 | $12,800 | $12,800 |
Total People | 0 | 4 | 4 |
Total Payroll | $35,300 | $60,900 | $60,900 |
The following sections will outline important financial information.
The following table highlights some important financial assumptions of Greens.
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 10.00% | 10.00% | 10.00% |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% |
Tax Rate | 25.42% | 25.00% | 25.42% |
Other | 0 | 0 | 0 |
The Break-even Analysis indicates approximately $3,900 is needed in monthly revenue to break even.
Break-even Analysis | |
Monthly Revenue Break-even | $3,956 |
Assumptions: | |
Average Percent Variable Cost | 7% |
Estimated Monthly Fixed Cost | $3,679 |
The following table indicates the projected profit and loss.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $41,748 | $91,254 | $97,854 |
Direct Cost of Sales | $2,922 | $6,388 | $6,850 |
Other | $0 | $0 | $0 |
Total Cost of Sales | $2,922 | $6,388 | $6,850 |
Gross Margin | $38,826 | $84,866 | $91,004 |
Gross Margin % | 93.00% | 93.00% | 93.00% |
Expenses | |||
Payroll | $35,300 | $60,900 | $60,900 |
Sales and Marketing and Other Expenses | $0 | $0 | $0 |
Depreciation | $1,152 | $2,552 | $2,552 |
Leased Equipment | $0 | $0 | $0 |
Utilities | $0 | $0 | $0 |
Insurance | $1,200 | $1,200 | $1,200 |
Licenses + bonded fees | $1,200 | $1,200 | $1,200 |
Payroll Taxes | $5,295 | $9,135 | $9,135 |
Other | $0 | $0 | $0 |
Total Operating Expenses | $44,147 | $74,987 | $74,987 |
Profit Before Interest and Taxes | ($5,321) | $9,879 | $16,017 |
EBITDA | ($4,169) | $12,431 | $18,569 |
Interest Expense | $1,847 | $1,675 | $1,495 |
Taxes Incurred | $0 | $2,051 | $3,691 |
Net Profit | ($7,169) | $6,153 | $10,831 |
Net Profit/Sales | -17.17% | 6.74% | 11.07% |
The following chart and table will indicate projected cash flow.
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $31,311 | $68,441 | $73,391 |
Cash from Receivables | $10,437 | $22,814 | $24,464 |
Subtotal Cash from Operations | $41,748 | $91,254 | $97,854 |
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $0 | $0 | $0 |
Subtotal Cash Received | $41,748 | $91,254 | $97,854 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $35,300 | $60,900 | $60,900 |
Bill Payments | $12,129 | $20,205 | $23,413 |
Subtotal Spent on Operations | $47,429 | $81,105 | $84,313 |
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $0 | $0 | $0 |
Other Liabilities Principal Repayment | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $1,800 | $1,800 | $1,800 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $7,000 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $49,229 | $89,905 | $86,113 |
Net Cash Flow | ($7,481) | $1,349 | $11,741 |
Cash Balance | $6,919 | $8,268 | $20,009 |
The following table indicates the projected balance sheet.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $6,919 | $8,268 | $20,009 |
Accounts Receivable | $0 | $0 | $0 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $6,919 | $8,268 | $20,009 |
Long-term Assets | |||
Long-term Assets | $4,750 | $11,750 | $11,750 |
Accumulated Depreciation | $1,152 | $3,704 | $6,256 |
Total Long-term Assets | $3,598 | $8,046 | $5,494 |
Total Assets | $10,517 | $16,314 | $25,503 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $336 | $1,779 | $1,937 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $336 | $1,779 | $1,937 |
Long-term Liabilities | $17,650 | $15,850 | $14,050 |
Total Liabilities | $17,986 | $17,629 | $15,987 |
Paid-in Capital | $0 | $0 | $0 |
Retained Earnings | ($300) | ($7,469) | ($1,316) |
Earnings | ($7,169) | $6,153 | $10,831 |
Total Capital | ($7,469) | ($1,316) | $9,515 |
Total Liabilities and Capital | $10,517 | $16,314 | $25,503 |
Net Worth | ($7,469) | ($1,316) | $9,515 |
Sales Forecast | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | |||||||||||||
Suburban middle class | 0% | $0 | $3,254 | $3,541 | $4,785 | $5,124 | $5,478 | $6,145 | $6,547 | $6,874 | $0 | $0 | $0 |
Other | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Sales | $0 | $3,254 | $3,541 | $4,785 | $5,124 | $5,478 | $6,145 | $6,547 | $6,874 | $0 | $0 | $0 | |
Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Suburban middle class | $0 | $228 | $248 | $335 | $359 | $383 | $430 | $458 | $481 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Direct Cost of Sales | $0 | $228 | $248 | $335 | $359 | $383 | $430 | $458 | $481 | $0 | $0 | $0 |
Personnel Plan | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Steve | 0% | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $0 | $0 | $0 |
Employee 1 | 0% | $0 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $1,600 | $0 | $0 | $0 |
Employee 2 | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Employee 3 | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total People | 1 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 0 | 0 | 0 | |
Total Payroll | $2,500 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $0 | $0 | $0 |
General Assumptions | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Tax Rate | 30.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | 25.00% | |
Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Pro Forma Profit and Loss | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | $0 | $3,254 | $3,541 | $4,785 | $5,124 | $5,478 | $6,145 | $6,547 | $6,874 | $0 | $0 | $0 | |
Direct Cost of Sales | $0 | $228 | $248 | $335 | $359 | $383 | $430 | $458 | $481 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $0 | $228 | $248 | $335 | $359 | $383 | $430 | $458 | $481 | $0 | $0 | $0 | |
Gross Margin | $0 | $3,026 | $3,293 | $4,450 | $4,765 | $5,095 | $5,715 | $6,089 | $6,393 | $0 | $0 | $0 | |
Gross Margin % | 0.00% | 93.00% | 93.00% | 93.00% | 93.00% | 93.00% | 93.00% | 93.00% | 93.00% | 0.00% | 0.00% | 0.00% | |
Expenses | |||||||||||||
Payroll | $2,500 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $0 | $0 | $0 | |
Sales and Marketing and Other Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Depreciation | $96 | $96 | $96 | $96 | $96 | $96 | $96 | $96 | $96 | $96 | $96 | $96 | |
Leased Equipment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Utilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Insurance | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | |
Licenses + bonded fees | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | |
Payroll Taxes | 15% | $375 | $615 | $615 | $615 | $615 | $615 | $615 | $615 | $615 | $0 | $0 | $0 |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Operating Expenses | $3,171 | $5,011 | $5,011 | $5,011 | $5,011 | $5,011 | $5,011 | $5,011 | $5,011 | $296 | $296 | $296 | |
Profit Before Interest and Taxes | ($3,171) | ($1,985) | ($1,718) | ($561) | ($246) | $84 | $704 | $1,078 | $1,382 | ($296) | ($296) | ($296) | |
EBITDA | ($3,075) | ($1,889) | ($1,622) | ($465) | ($150) | $180 | $800 | $1,174 | $1,478 | ($200) | ($200) | ($200) | |
Interest Expense | $161 | $160 | $158 | $157 | $156 | $155 | $153 | $152 | $151 | $150 | $148 | $147 | |
Taxes Incurred | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Net Profit | ($3,332) | ($2,144) | ($1,876) | ($718) | ($402) | ($71) | $551 | $926 | $1,231 | ($446) | ($444) | ($443) | |
Net Profit/Sales | 0.00% | -65.90% | -52.99% | -15.01% | -7.84% | -1.30% | 8.96% | 14.14% | 17.91% | 0.00% | 0.00% | 0.00% |
Pro Forma Cash Flow | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Cash Received | |||||||||||||
Cash from Operations | |||||||||||||
Cash Sales | $0 | $2,441 | $2,656 | $3,589 | $3,843 | $4,109 | $4,609 | $4,910 | $5,156 | $0 | $0 | $0 | |
Cash from Receivables | $0 | $0 | $27 | $816 | $896 | $1,199 | $1,284 | $1,375 | $1,540 | $1,639 | $1,661 | $0 | |
Subtotal Cash from Operations | $0 | $2,441 | $2,683 | $4,405 | $4,739 | $5,308 | $5,893 | $6,285 | $6,695 | $1,639 | $1,661 | $0 | |
Additional Cash Received | |||||||||||||
Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $0 | $2,441 | $2,683 | $4,405 | $4,739 | $5,308 | $5,893 | $6,285 | $6,695 | $1,639 | $1,661 | $0 | |
Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Expenditures from Operations | |||||||||||||
Cash Spending | $2,500 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $4,100 | $0 | $0 | $0 | |
Bill Payments | $25 | $751 | $1,203 | $1,224 | $1,308 | $1,330 | $1,355 | $1,399 | $1,426 | $1,410 | $350 | $348 | |
Subtotal Spent on Operations | $2,525 | $4,851 | $5,303 | $5,324 | $5,408 | $5,430 | $5,455 | $5,499 | $5,526 | $1,410 | $350 | $348 | |
Additional Cash Spent | |||||||||||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Long-term Liabilities Principal Repayment | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | $150 | |
Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $2,675 | $5,001 | $5,453 | $5,474 | $5,558 | $5,580 | $5,605 | $5,649 | $5,676 | $1,560 | $500 | $498 | |
Net Cash Flow | ($2,675) | ($2,561) | ($2,770) | ($1,069) | ($819) | ($273) | $288 | $636 | $1,019 | $79 | $1,162 | ($498) | |
Cash Balance | $11,725 | $9,165 | $6,394 | $5,325 | $4,506 | $4,233 | $4,521 | $5,157 | $6,176 | $6,255 | $7,417 | $6,919 |
Pro Forma Balance Sheet | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Assets | Starting Balances | ||||||||||||
Current Assets | |||||||||||||
Cash | $14,400 | $11,725 | $9,165 | $6,394 | $5,325 | $4,506 | $4,233 | $4,521 | $5,157 | $6,176 | $6,255 | $7,417 | $6,919 |
Accounts Receivable | $0 | $0 | $814 | $1,672 | $2,052 | $2,437 | $2,608 | $2,860 | $3,122 | $3,301 | $1,661 | $0 | $0 |
Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Total Current Assets | $14,400 | $11,725 | $9,978 | $8,066 | $7,377 | $6,943 | $6,841 | $7,381 | $8,279 | $9,477 | $7,916 | $7,417 | $6,919 |
Long-term Assets | |||||||||||||
Long-term Assets | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 | $4,750 |
Accumulated Depreciation | $0 | $96 | $192 | $288 | $384 | $480 | $576 | $672 | $768 | $864 | $960 | $1,056 | $1,152 |
Total Long-term Assets | $4,750 | $4,654 | $4,558 | $4,462 | $4,366 | $4,270 | $4,174 | $4,078 | $3,982 | $3,886 | $3,790 | $3,694 | $3,598 |
Total Assets | $19,150 | $16,379 | $14,536 | $12,528 | $11,743 | $11,213 | $11,015 | $11,459 | $12,261 | $13,363 | $11,706 | $11,111 | $10,517 |
Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Current Liabilities | |||||||||||||
Accounts Payable | $0 | $711 | $1,162 | $1,180 | $1,263 | $1,285 | $1,308 | $1,352 | $1,378 | $1,399 | $338 | $337 | $336 |
Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $0 | $711 | $1,162 | $1,180 | $1,263 | $1,285 | $1,308 | $1,352 | $1,378 | $1,399 | $338 | $337 | $336 |
Long-term Liabilities | $19,450 | $19,300 | $19,150 | $19,000 | $18,850 | $18,700 | $18,550 | $18,400 | $18,250 | $18,100 | $17,950 | $17,800 | $17,650 |
Total Liabilities | $19,450 | $20,011 | $20,312 | $20,180 | $20,113 | $19,985 | $19,858 | $19,752 | $19,628 | $19,499 | $18,288 | $18,137 | $17,986 |
Paid-in Capital | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
Retained Earnings | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) | ($300) |
Earnings | $0 | ($3,332) | ($5,476) | ($7,352) | ($8,070) | ($8,472) | ($8,543) | ($7,992) | ($7,067) | ($5,836) | ($6,281) | ($6,726) | ($7,169) |
Total Capital | ($300) | ($3,632) | ($5,776) | ($7,652) | ($8,370) | ($8,772) | ($8,843) | ($8,292) | ($7,367) | ($6,136) | ($6,581) | ($7,026) | ($7,469) |
Total Liabilities and Capital | $19,150 | $16,379 | $14,536 | $12,528 | $11,743 | $11,213 | $11,015 | $11,459 | $12,261 | $13,363 | $11,706 | $11,111 | $10,517 |
Net Worth | ($300) | ($3,632) | ($5,776) | ($7,652) | ($8,370) | ($8,772) | ($8,843) | ($8,292) | ($7,367) | ($6,136) | ($6,581) | ($7,026) | ($7,469) |
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Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your landscaping business, you will need to prepare a solid business plan.
In this article we go through, step-by-step, all the different sections you need in your landscaping business plan. Use this template to create a complete, clear and solid business plan that get you funded.
This is the first part and the most important section of your business plan. This is the first thing lenders and/or investors will have a look at.
Before we dive into the specifics, keep in mind the executive summary is a summary: keep it to 2 pages maximum. Indeed, your executive summary should briefly sum up the key sections of your business plan as well as presenting the funding ask.
The funding ask (or funding requirement), as explained below, is the reason why any business would have a business plan. Business plans are prepared for one of the 3 following objectives:
The executive summary of your landscaping business plan should include the following important information:
The business overview section of your landscaping business plan highlights what services your landscaping company offers, to whom as well as how your business is structured legally.
Ideally, this section should include the following details about your business;
Why did you decide to start your own landscaping business? Here a brief company history comes in handy if you want to outshine your competitors in the eyes of an investor (or a lender).
Use this section to mention 2 vital things about your landscaping business, including;
For example, you might be an experienced landscaping worker and found out there was no company offering landscaping services to businesses in the area where you’re from.
Landscaping companies have a number of services they offer to local customers, businesses or individuals. Ultimately, you should prioritize what suits your target audience depending on your market analysis. There are 2 main types of services for landscaping companies:
Of course, there’s nothing wrong with offering both services if you have enough resources. You can also offer your landscaping services individually or as comprehensive packages based on your clients’ needs and budget.
It’s crucial to outline your pricing list when writing a landscaping business plan. Focus on the most important details about your pricing structure without going overboard. For example, whilst lawn mowing costs on average $45 per week in the US, the cost of lawn care services ranges from $48 to $211 for homeowners .
Similarly, the cost of landscaping services may vary from one location to another, depending on the target audience. On an hourly basis, average landscaping services cost $50 to $100 per hour on average.
A clear pricing strategy can give you the upper hand when seeking financial support from potential investors and lenders, making it an important part of your landscaping business plan.
Also, it’s important to outline your pricing strategy in your business plan so investors can tie it into your financial projections later on (see more on that below).
What’s your target market ? Knowing your consumers will always play a key role in the success of your landscaping business. It also gives you a competitive advantage by helping you identify the existing market gap.
Are you targeting homeowners, commercial property managers, or businesses offices and headquarters? Understanding your target market will help you better define your marketing strategy and retain customers.
Finally, your business overview section should specify what type of business structure you opt for. Is this a corporation or a partnership (LLC)? Who are the investors? How much equity percentage do they own? Is there a Board of Directors? If so, whom? Do they have experience in the industry?
Download an expert-built 5-year Excel financial model for your business plan
Now that we have covered all about your business, let’s now look at your industry, and more precisely the landscaping industry in your area, your competitors and target audience.
Indeed, before you reach out to lenders or investors, you must prove to them that you understand your market. This helps earn their trust and can make the difference fo them to invest in your business.
You should present in this section the status quo of the landscaping industry in the US, as well as in your city / area. You must address 2 main points here:
Before diving into your specific city or area, it’s always good to get a clear overview of the US market first. Indeed, getting national data will help you address all the factors that could affect your business, such as demographics, market demand, and environmental activities.
The landscaping industry has grown at a steady rate of 2.5% per year in the last few years, up to $105 billion in 2021 .
After the US, assess the status of the landscaping market in your city or area. Focus on the zone where you plan to offer your landscaping services.
Naturally, you might not be able to get the data for your specific city or region. Instead, you can estimate the size of your market, for more information on how to do it, read our article on how to estimate TAM, SAM and SOM for your startup . To give you an example, let’s assume you plan to operate in a radius where there are 40 competitors:
As we know the US landscaping industry is worth $105 billion today, and there are about 604,000 landscaping businesses (small and large) in the US in total, we can deduct that the average annual revenue per landscaping company is $175,000.
So we can safely assume the landscaping industry is worth $7,000,000 in the area where you plan to operate. Now, assuming there are 30,000 houses, this means each household that owns a house spend $195 per month in landscaping services, pretty close to the national average.
Growth is an important metric for assessing the status of the landscaping industry in your region.
Here if you don’t find information online or via your research, you can calculate growth using the total number of landscaping businesses in your area.
For instance, if there were 40 landscaping businesses in the region in 2019, which increased to 45 in 2022, it’s safe to assume that the market is growing at 4% per year.
At the very least, your competitor analysis should answer all or some of these questions:
After answering these questions, it will be easier to tailor your services and prices to suit the target market.
We presented in the Business Overview section who were your target customers. Here instead instead you must show in your business plan that these target customers actually live in the area and need the services you offer.
Indeed, it would be pointless to start a landscaping business in your region when nobody needs your services in the first place.
And having competitors doesn’t necessarily mean your target customers are there. For example, you might not focus on the same customer segment (e.g. individuals homeowners vs. businesses).
There are here a few important questions you must answer:
The next section of your landscaping business plan gives you a chance to highlight your strategic plan for acquiring new clients.
Start by exploring your unique selling point, the suitability of the proposed marketing strategies, and the overall marketing budget.
Here are a few examples of marketing channels landscaping businesses use:
A unique selling point makes you stand out in a competitive market. When getting started, it is the easiest way to win over multiple customers and one of the best strategies for edging out your biggest competitors. You can build your USPs around the following aspects;
The 5th section of your landscaping business plan should be about people. It should include 2 main elements:
Here you should list all the management roles in your company.
Of course, the amount of details you need to include here varies depending on the size of your company. For example, a landscaping business with a number of vehicles and teams would need more detail vs. a small landscaping business run by 1 or 2 persons.
If you plan on running your business independently, you may write a short paragraph explaining who are the co-founders and/or senior managers (if there are any in addition to yourself). It’s important to highlight their experience in the industry and previous relevant professional experiences.
No matter how many leadership roles there are, you should now explain how you intend to run the company from a management standpoint.
What are the different teams (management, sales, operations, mechanics, finance, etc.)? Note that you should include these details even if you haven’t hired anyone yet. It will show lenders and investors that you have a solid hiring and management plan to run the business successfully.
A great addition here is to add an organizational chart that list all the roles, from Directors to managers, key supervisory roles, employees and contractors. Make sure to highlight with reporting lines who manages/supervises whom.
The financial plan is perhaps, with the executive summary, the most important section of any business plan.
Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors instead, a solid financial plan will prove them your landscaping business is an attractive investment.
There should be 3 sections to your financial plan section:
In the scenario where you already have some historical financials (a few quarters or a few years), include them. A summary of your financial statements in the form of charts e.g. revenue, gross profit and net profit is enough, save the rest for the appendix.
If you don’t have any, don’t worry, most new businesses don’t have any historical financials and that’s ok. If so, jump to Startup Costs instead.
Starting a small one-person landscaping business can cost as little as $500 , but most large-scale landscaping businesses need to spend more on equipment, marketing and staff. That’s why most landscaping businesses typically cost between $15,000 and $50,000 to start (excluding the cost of a vehicle).
As you can see, startup costs vary significantly according to factors like the size of your business, the number of employees, the quality of equipment, the services you offer and the tools needed, etc.
So, we have given you a clear overview below of all the essential costs you can expect to start a small landscaping business with 4 employees. There are 2 types of costs: startup costs and operating costs . For more information on how much it costs to start and run a landscaping business, read our complete guide here .
Note that these costs are for illustrative purposes and depend on several factors which might not fully apply to you.
Operating cost | Amount (per month) |
---|---|
Office / Warehouse | $12,000 |
Equipment Costs | $5,000 – $8,000 |
Vehicles (x2) | $20,000 (loan deposit) |
Licenses & Legal Costs | $2,500 – $3,500 |
In addition to startup costs, you will now need to build a solid 5-year financial model as part of your business plan for your landscaping business.
Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.
As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.
Your financial projections should answer at least the following questions:
You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:
When projecting your revenue, make sure to sensitize pricing and the number of contracts as a small change in these assumptions will have a big impact on your revenues.
This is the last section of the business plan of your landscaping business. Now that we have explained what type of landscaping services your company offers and to whom, at what price, but also what’s your marketing strategy, where you go and how you get there, this section must answer the following questions:
Any business plan should include a clear use of funds section. This is where you explain how the money will be spent.
Will you spend most of the loan / investment to acquire the cost for the vehicles, tools and equipment? Or will it cover mostly the cost of the salaries of your employees the first few months?
Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our landscaping financial model template , you won’t have any issues answering these questions.
For the use of funds, we recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.
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Written by Dave Lavinsky
Landscaping businesses run the gamut from one-person lawn care services to huge companies with dozens of locations. As long as people and businesses have lawns, there will always be work, yet many landscapers fail in the first year, often due to haphazard and unsustainable growth. A written business plan can help you avoid this trap by delineating a clear road map for organized growth. In addition, if you plan to seek outside funding, your business plan is essential to convincing investors or lenders to take a chance on your company.
Over the past 20+ years, we have helped over 2,000 entrepreneurs create business plans to start and grow their landscaping companies. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a landscaping business plan step-by-step so you can create your plan today.
Download our Ultimate Landscaping Business Plan Template here >
A business plan provides a snapshot of your landscaping business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.
If you’re looking to start a landscaping business or grow your existing landscaping business you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your landscaping business in order to improve your chances of success. Your landscaping business plan is a living document that should be updated annually as your company grows and changes.
With regards to funding, the main sources of funding for a landscaping company are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.
The second most common form of funding for a landscaping company is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan.
How to write a business plan for a landscaping company.
Your business plan should include 10 sections as follows:
Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.
The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of landscaping company you are operating and the status; for example, are you a startup, do you have a landscaping business that you would like to grow, or are you operating a chain of landscaping companies.
Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the landscaping industry. Discuss the type of landscaping company you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.
In your company analysis, you will detail the type of landscaping company you are operating.
For example, you might operate one of the following types:
In addition to explaining the type of landscaping company you operate, the Company Analysis section of your business plan needs to provide background on the business.
Include answers to question such as:
While this may seem unnecessary, it serves multiple purposes.
First, researching the landscaping industry educates you. It helps you understand the market in which you are operating.
Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards residential outdoor kitchens, it would be helpful to ensure your plan calls for employing plenty of skilled labor.
The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.
The following questions should be answered in the industry analysis section of your landscaping business plan:
The customer analysis section of your lawn care business plan must detail the customers you serve and/or expect to serve.
The following are examples of customer segments: families, baby boomers, businesses, etc.
As you can imagine, the customer segment(s) you choose will have a great impact on the type of landscaping company you operate. Clearly baby boomers would want different pricing and product options, and would respond to different marketing promotions than businesses.
Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most landscaping companies primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.
Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.
Don’t you wish there was a faster, easier way to finish your business plan?
With Growthink’s Ultimate Landscaping Business Plan Template you can finish your plan in just 8 hours or less!
Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.
Direct competitors are other landscaping businesses.
Indirect competitors are other options that customers have to choose from that aren’t direct competitors. This includes DIY platforms such as TaskRabbit, or doing the landscaping themselves. You need to mention such competition to show you understand that not everyone uses a landscaping business for lawn maintenance.
With regards to direct competition, you want to detail the other landscaping businesses with which you compete. Most likely, your direct competitors will be landscaping businesses located very close to your location.
For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:
With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.
The final part of your competitive analysis section is to document your areas of competitive advantage. For example:
Think about ways you will outperform your competition and document them in this section of your plan.
Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a lawn care business plan, your marketing plan should include the following:
Product : in the product section you should reiterate the type of landscaping business that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to mowing and trimming lawns, will you offer services such as insect and weed control?
Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the services you offer and their prices.
Place : Place refers to the location of your landscaping business. Document your location and mention how the location will impact your success. For example, is your landscaping business located near a garden supply store, or greenhouse, etc. Discuss how your location might provide a steady stream of customers.
Promotions : the final part of your landscaping business marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:
While the earlier sections of your lawn care business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.
Everyday short-term processes include all of the tasks involved in running your landscaping business such as serving customers, procuring supplies, keeping the equipment maintained, etc.
Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 100th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch in a new city.
To demonstrate your landscaping business’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.
Ideally you and/or your team members have direct experience in the landscaping business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.
If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in landscaping businesses and/or successfully running retail and small businesses.
Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.
In developing your income statement, you need to devise assumptions. For example, will you serve 100 customers per week or 200? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.
Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your landscaping business (purchasing equipment, etc.), that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.
In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a landscaping business:
Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.
Putting together a business plan for your landscaping business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the landscaping business, your competition and your customers. You will have developed a solid lawn care business plan and will really understand what it takes to launch and grow a successful landscaping business.
You can download our lawn care business plan example pdf here. This is a business plan template you can use in PDF format.
What is the easiest way to complete my landscaping business plan.
Growthink's Ultimate Landscaping Business Plan Template allows you to quickly and easily complete your Landscaping Business Plan.
You can download our landscaping business plan sample pdf here. This is a business plan template you can use in PDF format.
Don’t you wish there was a faster, easier way to finish your Landscaping business plan?
Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success. Click here to hire someone to write a business plan for you from Growthink’s team.
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Landscaping Business Plan Example. Below is a sample landscaping business plan and template to help you create each section of your landscaping business plan. Executive Summary Business Overview. Beautiful Gardens Landscaping Service is a startup landscaping business located in Dallas, Texas.
Do you want to start a landscaping company and need to write a plan? If YES, here is a sample landscaping business plan template & feasibility report
We have created this sample landscaping business plan for you to get a good idea of what a perfect landscaping business plan should look like and what details you need to include in your stunning business plan.
Explore a real-world lawn landscaping business plan example and download a free template with this information to start writing your own business plan.
Use this template if you're preparing a business plan for your landscaping business. Complete guide for creating a solid business plan.
If you’re looking to start a landscaping business or grow your existing landscaping business you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your landscaping business in order to improve your chances of success.