Learning how to start a lawn care business begins with writing your business plan and understanding the various associated costs and required legal documents. You’ll also need to research the market, analyze your competition, secure funding, and set up your business systems.
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Step 1: Write Your Lawn Care Business Plan
Starting a business begins with drafting a business plan, which helps you get clear on the market you’re serving, equipment costs, and how much money you expect to earn and spend during the first three years in business. A lawn care company will have no shortage of customers, but you need to know how you’ll reach them and differentiate your business from competitors.
Before writing a business plan, you need to determine whether you’re going to create a traditional or modern one. A traditional business plan is similar to a business report and is a requirement for receiving a bank loan. A modern plan, such as a Business Model Canvas (BMC), is an alternative for business owners who don’t plan to get a bank loan and want to create a more simplified, visual business plan.
The basic sections of a BMC business plan can be filled out in less than 30 minutes. (Source: Strategyzer)
Sections of a Business Plan
The market research section of the business plan is where you explain who your ideal customer is and how many you need to sustain your business. As the owner of a lawn maintenance business, you have a lot of potential customers.
To get things organized and begin finding useful patterns, describe potential and ideal customers using criteria such as:
- Age
- Location or proximity to your business
- Density, or distance between customers
- Income level
- Spending habits
The main goal of your market research should be to find easily accessible customers who are likely to be interested in your services. The best way to find the information you need is to do first-hand research—drive around and see which neighborhoods have lawns that are not being taken care of.
Also, research which lawn companies serve certain neighborhoods. Then, look up their Google reviews and identify which companies have the lowest average reviews. Marketing your lawn company in the neighborhoods that your lowest-reviewed competitors service is a good idea because some customers are likely to be unhappy with their service and looking for an alternative.
Market via customers you already know and even offer to perform lawn care services for friends and family. Be sure to do a stellar job, and take photos of your work to post on your business listings. Then, ask these customers to let their friends and contacts know that you’re in the lawn care business and looking for new clients.
Because you’ll be purchasing your own lawn care equipment, it’s important to research equipment costs. You’ll factor the lawn care equipment costs into the financial projections we’ll discuss later. You’ll also include the costs in the amount of capital you need to acquire to start the business.
The main question you need to answer about equipment is whether you should purchase it new or used. If this is your first business, it’s wise to keep your startup costs low and purchase used equipment from local stores or websites like Craigslist or Equipment Trader. When your business earns a profit, you can upgrade your mowing equipment.
Competitive analysis is the process of documenting your competitors’ strengths and weaknesses. This information can help you generate marketing ideas by allowing you to focus on providing a service or feature that your competitor does not.
For example, it could be a service, like sod installation, or a business feature, such as a money-back guarantee. You can also try specializing in a particular lawn care service, demonstrating consistently excellent results, and expanding your offerings beyond basic lawn care. You should also strive to learn as much as possible about the technical details of the industry in order to improve your quality of service, answer customer questions, and display competence and expertise.
To conduct a competitive analysis, research your top five lawn care competitors. For each company, list their strengths and weaknesses. What do those businesses do well, and what can they improve on? A company’s marketing is your number one source of information for competitor research. Look at their print marketing and online marketing by reviewing their website and Google Business Profile.
The financial projection section is the most difficult part of a business plan. It’s where you document startup costs, or how much money it takes to start your business. You’ll consider these costs when projecting how much money you plan to earn monthly for the first few years you’re in business. You’ll also need to add a subsection that shows a high-level view of income and expenses in a year-by-year format for the first three years.
For example, if you’re taking out a loan to purchase lawn equipment, this is a startup cost. You need to factor in the loan repayment as a cash outflow every month until the entire loan is paid off. Your financial projections determine how long it will take for your business to be profitable after you factor in equipment startup costs; it may take you several months or years to pay off startup costs. Additionally, you can save money on taxes by deducting the cost of equipment from your business tax returns, which you can learn more about through our guide on the Section 179 deduction.
You must finalize your financial projections if you’re seeking funding from a bank or investor. Typically, the financial projection is the first section of a business plan that they look at because they want to know how and when they will make their money back. Additionally, once you start the business, you will use your projections to determine if you’re meeting your financial goals.
Business Plan Software
You may find that working on a business plan from scratch is an overwhelming process. There is software available to walk you step-by-step through the process.
LivePlan, our top pick for the best business plan software, shows you each section you need to complete, along with additional details, so that you know how to complete it. It also takes the financial projections numbers you entered and creates visually appealing charts. Use these charts to better understand the potential growth of your lawn care business.
It has a lawn care business plan example you can learn from. This example is a traditional business plan that would be used for funding from a bank or investor. Its fictional lawn care company requires $16,000 in startup costs and doesn’t become consistently profitable until the ninth month.
LivePlan’s lawn care business plan example has the business making a profit of $16,000 in year three. (Source: LivePlan)
Step 2: Obtain Funds for Your Lawn Care Business
After you write your lawn care business plan, you’ll be ready to seek funding. If you need a substantial loan (over $75,000), you will most likely start your funding search at a bank. If you’re well-networked in your community, seek an investor or start a crowdfunding campaign. You can also take out a smaller loan (less than $50,000) in the form of a personal loan or use credit cards to finance costs, such as lawn care equipment.
Secure a Bank Loan
Typically, a bank wants to lend at least $75,000 to a small business. You may need a loan amount of this size if you’re purchasing higher-end equipment, like trucks, trailers, and commercial mowers. Additionally, if you’re hiring several employees, you need to have enough funds to cover the first month of their salaries.
If your company is a startup, the bank will require you to have the amount of funds you’re seeking in a separate account, like a Certificate of Deposit (CD). This is because the bank wants to recover its loan if your business fails.
Take Out a Personal Business Loan
If you’re looking for funding under $75,000 or don’t have money saved as collateral for a business loan, you may want to explore a personal loan, which is typically based on your credit score but can be used for business purposes. A credit card can be used as a personal loan as well, and business owners typically use credit cards for costs under $10,000.
Note, however, that a personal loan or credit card has a higher interest rate than a loan secured to an asset like a CD account.
Our related resources:
Find an Investor
An investor is an individual or a group of people who lend you money for a percent of equity (ownership interest) in your business. People look for investors so they don’t have to assume debt. If the business were to fail, you typically wouldn’t owe an investor any money, whereas you would for a bank loan.
It can be a challenge to find an investor in your community. The best way to discover an investor is to create a business plan with clear financial projections and network within the business community, like joining your local chamber of commerce.
Crowdfund
Crowdfunding is a way to raise money for your lawn care company by offering rewards for services paid in advance. A crowdfunding campaign for a local business can be successful if you have a network of potential customers willing to purchase your services in advance.
For example, as a reward, you could offer homeowners a deal to buy several months or a year’s worth of lawn maintenance in advance at a discount. You could then use the money raised to buy the lawn equipment.
Typically, a crowdfunding campaign will charge a 5% fee on all proceeds for using their platform. In exchange for a fee, the platform will provide a website landing page, a messaging system for campaign updates, and promotion within their platform.
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Step 3: File Legal Documents for Your Lawn Care Business
Before taking on any customers, take these steps:
File Your Business as a Legal Entity
Filing as a legal entity forms a business organization that separates and protects your personal assets. This means that your personal assets will be protected in the event that your business is sued or goes into debt.
Approximately 43% of small businesses file as an LLC, which is a legal entity that protects its members from a business’s debts and lawsuits. Depending on your business and tax structure needs, you may want to file as a corporation or an S-corp.
Obtain Your Employment Identification Number
Your Employment Identification Number (EIN) is a number the IRS gives businesses for federal income tax and employee payroll tax tracking purposes. It is free to apply for an EIN number from the IRS, and you can get an EIN simply by gathering all the necessary business information and then sending in an application electronically or by mail. Typically, the EIN is also required to open a business checking account.
Secure a Business License
Typically, you don’t need a license to operate a lawn care company with mowing and basic maintenance of a lawn. However, several states, such as California and Alabama, do require a lawn maintenance-related license. You may need to take and pass an exam in order to get licensed.
If you’re applying chemicals—such as pesticides—to a lawn, it’s likely that your state requires a license for that service. Regardless of the services your lawn care business provides, it’s wise to check your state’s and county’s official website for lawn maintenance business license requirements.
Get Liability Insurance
Purchase landscaping (liability) insurance for your lawn care business to protect yourself in case of employee injury or property damage. For example, if your mower does substantial damage to an irrigation system on a commercial property, your business may be liable for that damage.
Several states, such as Louisiana and California, require liability insurance to operate a landscaping business. The typical cost of liability insurance for a lawn care company ranges from $500 to $2,300 per year.
Open a Business Checking Account
You should open a business checking account before your lawn business incurs expenses; for options, see our roundup of the best small business checking accounts. Additionally, it’s wise to separate your business and personal finances in the event of a tax audit.
Step 4: Set Up Lawn Care Business Systems
Once you’ve completed your legal documentation and opened a business checking account, set up business systems for processes such as hiring employees,
Additionally, you’ll want to purchase relevant software. For example, you’ll need
- payroll software if you plan to hire employees (see our top-recommend payroll software)
- accounting software, as it helps to track income and expenses (check out our best small business accounting software)
- CRM software if you want to track your business leads and stay in touch with customers (review our leading CRM software)
Hire & Pay Employees
Many lawn care businesses begin with the owner as the sole employee. Other lawn businesses start with a few employees handling different lawn maintenance tasks. If you’re searching for employees to hire, post your open positions on job posting websites like Craigslist or Indeed. You should also run a background check before hiring an employee; our list of the best background check companies will help you get started.
One of the best ways to find employees is by using your website and social media. Add a “Jobs” page to your website with your lawn maintenance job description. Take that page, and share it with your social media followers. Sharing a job opening is also a great way to promote your business without directly advertising to your personal friends on Facebook.
Once your employees work for your lawn care business, you need to pay them. It’s important to maintain your business’ payroll records in case of a tax audit.
Get Accounting and Billing Software
Part of being a business owner is tracking income and expenses. Small lawn care businesses can manage with a simple spreadsheet and a basic understanding of small business bookkeeping. Larger or more profitable businesses can benefit from accounting software like QuickBooks, Sage, or Xero. Accounting software helps you keep track of your business’ financials and sometimes even includes tools for sending digital invoices.
One benefit of sending invoices online is that it gives your customers the option to sign up for automatic monthly billing. This reduces the time you have to spend every month collecting invoices sent to customers. If you don’t need full-blown accounting software, consider one of the best invoicing software to simplify your billing process.
Manage Customer Relationships
It’s important to keep track of the customers you interact with about your lawn care services, especially in the early stages of your business when you are building up your client base and relying on word-of-mouth referrals.
There are many ways to manage your customer relationships—small lawn care businesses might take detailed customer notes on a smartphone and schedule follow-up reminders, whereas more ambitious operations use some form of CRM software, which helps you organize leads, convert them to customers, and manage the customer relationship as your business grows.
For example, send your customers a card wishing them a happy birthday and include a discount. Automating this process with a CRM will save you time. It’s difficult to set up birthday reminders and send out cards to dozens or hundreds of customers without a CRM to assist.
Step 5: Market Your Lawn Care Business
The best way to market your lawn care business is through face-to-face communication. Potential customers like to meet the person maintaining their lawn. Referrals are also great marketing for your lawn care company. Traditional marketing—like business cards, flyers, and thank you notes—makes your business memorable to current and potential customers. Additionally, potential customers go online to look up your business; they’ll want to see the quality of your work and read online reviews before committing.
Traditional Marketing
Traditional marketing includes the physical materials you need to market your lawn care business, like brochures and business cards. Companies like Vistaprint and Canva print business cards, flyers, posters, small signage, and even promotional materials like hats and mugs.
Other traditional marketing strategies include sending handwritten thank-you notes to all first-time clients. This is a kind gesture that your customer will remember. Additionally, the thank you note is also a great marketing piece your customer may share with their neighbor.
Online Marketing
Having a quality online presence for your lawn care company helps you get in front of your ideal customers and gives you credibility when potential customers find your business online. For example, when someone searches your business’s name in Google, your Google Business Profile will show up along with customer reviews, business photos, and contact information.
Here are online marketing strategies for your lawn maintenance business:
- Website: A website for your lawn care service is the digital billboard for your business. If you’re trying to create your small business website, save time by using an existing lawn care website template and simply enter your business’s information.
- Email marketing: Email marketing is the best free or low-cost way to get your business in front of current customers. For example, you may want to send an email out to your current client base announcing that you will be paying a referral fee to those who recommend a new customer for lawn service. Mailchimp is free for up to 500 contacts and 1,000 email sends per month.
- Social media marketing: At a minimum, you need to create a Facebook page and make a dozen quality posts about your business. Your Facebook page will show in Google when someone searches the name of your lawn maintenance business. Having a Facebook page show in Google will give your business added credibility.
- Google Business Profile: Create a free Google Business Profile to showcase who you are and what your business does. At minimum on your listing, you need to fill out your business’s basic information like phone number, hours of operation, and address. If you operate your lawn care company from home, you don’t have to show your home address.
Your Google Business Profile can hide your address and create a radius showing the area you service. It can also display photos of your work, business logos, and special business attributes (such as being a women-led company) to help win over new customers.
With Google Business Profile, you can list the services you offer, display your business credentials, send quotes to customers, and schedule appointments. (Source: Google)
Depending on how much time you have, you can work on your online marketing strategies every week, month, or quarter. At a minimum, your website should be updated with accurate information. You should also review your Google Business Profile every month to monitor negative reviews and flag inappropriate or inaccurate photos that may be uploaded by users.
Networking
If you’re interested in getting commercial landscaping clients, networking is a must. Joining and attending meetings for your local Chamber of Commerce or Business Networking International (BNI) group helps potential customers put a name and face with a business. Additionally, you may want to network with other residential-based service companies, like pressure washer and pesticide companies, to receive referrals. Property managers are also a great group to network with because they may recommend your business to their home residents.
Government Contracts
Government-owned properties like schools and military bases hire lawn maintenance companies through government procurement contracts. To apply for these contracts, you need to register with the proper federal, state, or city entity. If you’re interested in government contracting, it’s best to visit your local Procurement Technical Assistance Center (PTAC), which is a taxpayer-funded federal program that provides small business owners with no-cost consulting on doing business with the government.
How Much Should I Charge to Perform Lawn Care Services?
Several factors will influence the optimal amount to charge for your services—your level of experience, testimonials from your first few customers, the equipment you use, the particular services you offer, the size of the lawn, and the income level of your target market.
That said, here is a list of typical price ranges per lawn care service compiled by home services website Angi:
Lawn Care Service Fee Ranges | |
|---|---|
Lawn Mowing | $50-$205 |
Landscaping | $1,260-$6,020 |
Weed Removal | $35-$400 |
Flower Bed Installation | $800-$3,000 |
Shrub, Bush & Hedge Trimming | $450-$1,420 |
Leaf Removal | $300-$600 |
Yard Cleanup | $190-$1,000 |
Lawn Care Business Frequently Asked Questions (FAQs)
Click through the following sections to learn more about lawn care business costs, requirements, and profitability.
You can start a lawn care company with as little as $2,000 to over $100,000, and how much you spend depends on your equipment needs. Lawn maintenance business expenses increase as you add industrial lawn equipment, trucks, trailers, employees, and an office.
You may need a license. Some states, like Alabama and California, require a license to maintain lawns. You might also be required to pass an examination. It’s best to check your state’s and city’s license requirements before opening a lawn business, which can be found on your state’s (or city’s) official website.
The average lawn care price is between $30 to more than $200 per visit. The size of the lawn and the type of lawn services provided affect how much you charge per lawn. A good rule of thumb is to charge $60 per worker per hour of work. You may also want to incorporate travel time into your lawn mowing estimate. If you are already cutting a lawn in that neighborhood, you may quote a lower price because of the short travel time.
Yes, lawn mowing can be a great business if you’re well-organized and do quality work. If you provide a great service, your business can quickly spread by word of mouth. Travel time can eat away at your profits, so it’s best to focus on a certain neighborhood or area and build clientele there.
If your state or city requires a lawn care license, they typically cost under $100. Remember, in addition to the business license, your lawn company needs to file as a business entity in your state, which costs around $150.
A lawn care company needs liability insurance, commercial auto insurance, and workers comp insurance if it has employees. Liability insurance for a lawn company protects you from property damage and costs about $400 a year. Commercial auto insurance is about $750 a year for minimal coverage. Workers comp insurance is roughly $450 a year per employee.
Bottom Line
A lawn care business can be a weekend side business or a multi-million dollar business with hundreds of employees. In either case, you’ll need a business plan with financial projections. Use tools like a CRM system and a Google Business Profile to help you track and attract new customers. Once you pay for your equipment and have a solid client base, your lawn care company can be a highly profitable and successful business.
