Is this fiesable?

[treeman82]

Hey guys. I am trying to figure out where I want to go with my business. I was just wondering if it is still fiesable for a company to be able to make good money with only working for a hand full of customers? Let's say no more than 20 - 30 customers. I am not talking about having 20 employees, more like 5 or so plus the owner.

 

[TREETX]

Yes, 20-30 would work because that number will grow through references. I don't know if you could support a 5 man crew with that. The other important thing will be to be real service oriented and follow through. You have to charge more for that. The good thing about that is then you can charge more and be less commodity based. I all depends on where you want to take your company, what your debt tolerance is, and how much you like vacation. Either way, good luck!

 

[DDM]

Hmmmm I dunno 20-30 sounds like to few That might support a 1+1 Crew Unless your talking about Lawn maintenance,Landscape installs and tree work.

 

[SpikedSupra]

Its simple

Gross/Overhead ratio. If your gross outweighs your overhead it doesnt matter how small or big you are. A company can make $5,000 dollars a day gross and lets say their overhead(Labor, Equipment deprecation, Outstanding debts from loans....ect ect...) comes out to $4,000 a day they will be clearing $1,000 a day. Another company gross' $1,500 a day but there overhead is 400 dollars a day.....they have made 100 dollars more than the first company and they are much smaller. Big business isnt the answer to money....budget efficient business is the answer. Cut your clientel and cut your costs. If liability cuts outweigh your clientel you will actually make more money with less work! This is other wise known as downsizing. Try to do the most work with the least amount of overhead. Dont get cheap though....money needs to spent wisely. Going for that cheap laborer who you will pay half a good worker isnt a good idea if he cant at least do the work in 60% of the time cause then its time wasted and time is money.

 

[Greg]

Sounds very small to me, unless 1 of those customers is a chain of stores, or a large office park, or disney world, etc... 20-30 med to upper level income/size residences won't take you to far. Dealing with 20-30 5-7 acre estates maybe.....
Greg

 

[Rob Murphy]

What Forest said!!!!!!!!!!

 

[treeclimber165]

This sounds like an admirable goal, but it isn't like you can just say "I'm only going to have 20-30 customers" and it happens. I assume by 'customers' you mean 'accounts'. Large accounts that would consistently provide at least one day of work per month. Commercial property management companies, retail chain stores, etc.
You can make it happen by seeking out these types of accounts and nurturing the business relationship. When you get one, provide for their needs above everything else. Be there when they need you, and do whatever it takes to make them not want to call anyone else. Be consistent in your pricing. Good luck with it!

 

[TREETX]

My god, I can't believe I am saying this but, thanks Forrest for those comments. Really good points. Ones I live by. Being bigger and having more clients does not automatically translate into increased profits!!

I will add that what you said makes a whole lotta sense in academia where things are black and white but it gets a whole lot more complicated when you are running your own show with real money and real life stresses. It can be a battle between the short run needs and the long run needs.

 

[treeman82]

Greg and Brian are thinking along the same lines I am thinking. To do work at estates (plenty of them around here) and a couple of small corporate accounts. To be honest with you guys, I don't like having to deal with many people as customers, however the customers I do deal with, I like to have good relationships with (not just send the bill and paid).

 

[DDM]

Originally posted by treeman82
(not just send the bill and paid).

It helps Though

 

[treeman82]

True.

 

[Nickrosis]

How's the theory working out in practice?

For us, about 10 customers make up almost half of our income in a year. Think of the benefits of familiarity! Everyone knows who and where the customer is. You're able to be more personalized in your service. Less paperwork. Less advertising. Less driving around. Less to keep in your head. More in your pocket.

Why do 500 jobs for $50 each when you can do 20 for $1250 each? Same gross and probably more profit. We don't have the same 10 people repeat that every year, but we do have a strong core of clients which I would really like to hang onto.

Nickrosis

 

[budroe69moni]

what's HE doing here??????

 

[John Paul Sanborn]

What forrest said.

Your income must exceed your outflow.

What do you project for a year?
What are your slow months?

Here is what I do, since I'm a mini-micro company.

I target working 4 days a week, weeks a month. Or 192 days a year.

So if I average a gross $200 per day I will do 38,400 per annum.

Go through your calendar and cross off all improtant holidays that you definately will not work. Wich week days will be your short or off days, do you forsee yourself honoring Shabott and knocking off friday afternoons?

How many vacations do you want to take durring the year, and when?

When do you usualy have raindays?

After doing all this you will probably find your self near a minimum work year of 200 days too (sat/sun add up to 104 days alone).

Now find out what you need for a minimum ave daily gross to hit your target minimum budget. How many jobs will you need to be able to meet this goal?

As otheres have said, unless you are doing more then just tree work, then 30-40 client is a bit low. even if you average 2 days of work per year from each client, that will leave you with around 120 days to make up with single shot customers. You will always have to do this, to some extent, cant rely on the customers being your gravey jobs to pad the income.

 

[Nickrosis]

With Matt's skills, he could easily do a number of things for a customer that would keep him humming for two days a week at a single five acre lot. 15 hours a week for each one of those.... he'd need 2.5 of those customers to fulfill a 40 hour work week, year round. Of course, it could be busier at sometimes and slow at others.

Basically, Matt, caretakers stay occupied with just one client. Twenty could keep you hopping.

Nickrosis