New Survey by NALP
The National Association of Landscape Professionals (NALP) conducted a survey about five years back. According to the survey, a landscaping business owner’s salary was within the range of $54,000 - $115,000. In most cases, the salary of the business owner was about 10% of the total sales done by the company. 10% of the turnover was considered a reasonable amount for the owners of landscaping businesses.
According to Turf Magazine-
According to Turf‘s Compensation Survey, 20 percent of landscape contractors say determining their salaries is a trial and error process; they aren’t sure what they are going to make each year. When asked if they thought they’d be making more money as landscape business owners, the majority of landscape contractors (36 percent) said they weren’t sure, followed by 35 percent who said they thought they would be making more money
Lucrative job; no training required
A survey conducted
among landscaping businesses of different sizes reveals that the average landscaping business owner’s salary in cases of the businesses with annual revenues below $200,000 was not less than $31,000 as of the year 2005. However, there are highly successful businessmen in this field who could draw their salary in the range of $105,000 - $205,000 within a few years of starting their business. There is a huge amount of work that has to be managed in this business. It has various challenges and complex situations that are to be faced by a landscaping business manager and are to be adequately compensated with the financial gains from the business. Apart from drawing a lucrative landscaping business owner's salary, the person who gets into this business can learn his job by starting to work straight away from day one. Specialized training or any academic qualifications are not necessary to start this business.
Owning a Landscaping Business Can Be Lucrative
In the US, about 25% of landscaping people are self-employed and they provide lawn maintenance services to their customers on a contractual basis. It is estimated that the landscaping services provide not less than 700,000 jobs in a year and this service sector generates not less than $35 million in a year from the value-added services. Builders of residential as well as commercial properties use these services. Homeowners who seek fresh, state-of-the-art landscaping for homes, new homeowners who are eager to update the landscaping and those homeowners who lack the skills and tools required for landscaping become the customers of these landscaping businesses. Those who have acquired the knowledge of landscaping and are enthusiastic about being in that field for long can take advantage of it to flourish in the landscaping business. It would help them earn handsome amounts every year as landscaping business owner’s salary.
Landscaping Business Is Profitable
The landscaping business is indeed profitable but, it is not simple and easy. It is a highly complicated business and the business owners need to put in a lot of effort to earn more than what they invest. Those who have years of experience and expertise in landscaping agree that creating revenues and controlling expenses are very difficult tasks in this business. While the minimum average wage paid in this industry comes to $17 per hour, the average landscaping business owner's salary comes to $46.3 per hour. The owner of a small landscaping business may get an average salary of $59,200 annually. Those who run a landscaping business and offer landscaping services have good scope to acquire more wealth. Also, the past experiences of many landscape business owners reveal that during the days of economic downfall, the business may be affected.
Trial and Error method to calculate salary
Some owners just guess
A few landscape owners follow the trial and error method to decide the landscaping business owner’s salary. They follow this method mainly because they have no clear idea about the volume of sales that will be achieved by the company each year. Some landscape owners say that they expected more income from their business in a particular year but it was not to be. There are also business owners who do not take any money as their salary. When they require money, they may take from the company’s kitty. During the initial years of the landscaping business fixing of the business owner's salary was not in practice. The landscape owner will put a lot of effort to run the business profitably with the expectation that after paying all the bills some amount of money will be left behind which they will presumably take as their salary.
Based on revenue
So, as long as sufficient revenue is generated, a fair amount can be fixed as the salary for the owner of the landscaping business. When the company's revenue is in the range of $150,000 - $200,000, the landscaping business owner’s salary can be up to 35% of the total revenue. In such cases, the landscape owner will carry out most of the work by himself. However, when the business grows further and the total revenue reaches the $500,000 level, the overhead of the company will be much more and as a result, the business owner will be having a heavy burden of salaries and wages. In these circumstances, a maximum of 15% of the total revenue generated can be paid as the landscaping business owner’s salary.
How the landscape owner should determine his salary?
The owner of the landscaping business must have a clear idea of the financial position of his company. He must have the figures at his fingertips about total revenue, expenses and net profit of the fiscal year. While working out the expenses he should include a few future expenses also such as the purchase of trucks, machinery and various types of equipment to replace the old ones. The owner should also know the exact amount required to pay the salary/wages for his employees. The owner should also ensure that the company has sufficient funds to run the business and to the work done. After completing all these calculations, he can decide how much he should pay himself as landscaping business owner’s salary. It is indeed a great idea to start with a small salary for a landscaping owner. This approach will enable him to invest more and boost the growth of his business. Therefore, he can choose to increase his salary as time goes by.
Starting Salary for lawn or landscaping business
Many landscaping business owners avoid figuring out their salary. To meet their expenses, they utilize the money left over after clearing their company’s bills. This cannot be taken as a systematic approach as this method can lead to creating a lot of financial confusion. The business owner should draw a clear line between the assets of the company and his assets. One has to maintain separate accounts for company expenses and the owner's expenses. If both expenses are managed in a single account the process of tracking the business expenses will get complicated and the confusion may lead to serious problems. To avoid confusion and to ensure smooth functioning of the business, many business owners start with a rather small amount as their salary. This would be within the range of $23,000 - $25,000 per.
Planning is important for a Landscaping Company
A landscaping business owner needs to have a robust business plan to run the business successfully. The business plan will show how to make more money than what the company spends. Developing new channels of revenue and strict control of expenses is very essential to ensure profit from this type of business. From the business plan, the owner can get the business strategy to be adopted. In case, the company requires a business loan from a bank, a perfect business plan has to be in place. While creating the business plan the landscape business owner must have an objective approach. This approach would strictly focus on the revenue and the expenses of the business. There must be a proper budget for the company that must be realistic too. By preparing the budget, the owner gets a clear picture concerning the revenues and expenses. After knowing how much is left, he can decide the landscaping business owner’s salary for the year under consideration. When the business owner works out his salary this way, it will be a fair and reasonable amount and will be well within the budget limits of the company.
Running your own landscaping business is indeed a profitable business and this business has various advantages. The owner of the landscaping business can be his master and he can carry out his lawn-care or landscaping activities at his own pace. The business owner can work whenever he wants to and relax when he feels so. Those who are in landscaping business spend most of their time working in the open air, breathing fresh, and unpolluted air. Since they will have a lot of physical activities in this business, they get a lot of exercises and can enjoy good health. There is no limit for a landscaping business owner’s salary. The business owners can make their business highly profitable by offering services like land mowing, trimming, landscape designing, maintenance, application of chemicals, fertilizers and more.