How to start a lawn care business - Part 2, Lawn Care Business Plan I

As in anything in life, a plan is a MUST to prepare oneself for any eventualities that could hamper the efforts to succeed. More so for starting a lawn care business or any type of business for that matter. The process of preparing the business plan is by itself a good thinking exercise as it forces the self-starter to go through the thought process and become more aware of the situation that is being addressed. A lawn care business plan that is well thought and prepared will serve as a road map, guide book, compass, etc. which will most certainly increase the chances of success. Additionally, if funds are required to finance the startup of the lawn care business, more likely than not, a well written lawn care business plan will be mandatory in securing the funding either from banks or other investors. More on that later on.

What's in the Lawn Care Business Plan

Most people would perceive drawing up a business plan to be a daunting task but it need not be if a a few things are kept in mind. The purpose of the business plan is to determine where the business is at the moment, what are the goals to be achieved in the required time frame and how to go about achieving the goals. It's like cooking, decide on what to cook, obtain the ingredients & utensils required and start cooking up a storm. In this case, the ingredients for the lawn care business plan will be the results of the market research.

Goal Settings

Begin with a set of goals or targets. Whatever it is, it has to be specific, measurable and achievable with a known dateline as well. Just stating to make money is not specific enough and certainly not measurable. It could go somewhere along the lines of perhaps generating monthly revenue of $20,000 within 6 months and/or be the dominant company with a 51% market share in a particular market segment. This will be the foundation of the business plan as subsequent parts of it will be geared towards achieving these goals.

Identifying the target market or niche

Upon analysing the information derived from the market research, a niche in the market would have been identified. The size of this niche in the market should be substantial enough to support the business in achieving the stated goals. If there are more than one target market, state clearly what's the potential revenue from each segment. It should also be the ones that matches your capabilities or resources. That is to say, it will not be a wise idea to target the business of a golf course if your setup is going to be a one man show with a pair of garden shears. One of the most important factor to be considered when deciding on a niche is that your business must have an advantage or USP (unique selling proposition) which will pave the way for winning clients over easily. Without the advantage, fighting for a piece of the pie with the competitors will be a tedious and onerous ordeal that could very well result in failure.

Resources

From identifying the niche market, the type of services needed in this market will determine the type and amount of resources that will be required to complete the jobs. Resources could be in the form of manpower, equipment or even certain specialized skills. There are some tactics that can be employed to lower the cost of acquiring these resources. For example, instead of hiring permanent staff, hire college students and pay by the hour in the event that there are not enough jobs, the worker will not be sitting around idle while you are still required to pay the salary. Equipment which will probably form the bulk of the initial start-up cost could be purchased new; alternatively go for something used or even leased. This will reduce the cost substantially. For information on equipment, have a look at stackyard. It's an agricultural themed site that has many interesting articles and information that is relevant to lawn care too.

Insurance, Legal matters & Lawn Care Contracts

Due to the nature of the business, purchasing an insurance policy is essential in safeguarding the business from large claims owing to damages and repairs to properties which might occur in the course of providing the service. There are many types available in the market, so shopping around for one well suited to the business will be necessary. Similarly, legal counsel is a must especially in drawing up lawn care contracts. The main purpose of the lawn care contracts is to set out in writing the terms and conditions by which the service will be provided. Items like the job scope, warranties, inclusion/exclusion clauses,etc, are part and parcel of what will be laid out in the service contract. There might be some standard terms pertaining to the industry which must be included, so seeking out legal advice to cover all bases will do the business a whole lot of good in the long run. Especially if any disgruntled clients decides to pursue any legal proceedings against the company for whatever reasons. A couple of things that could be done to familiarise oneself with the lawn care contract is to approach any associations or governing body related to the industry. Or just whip out the competitor's lawn care contract which was obtained during the market research phase and modify it to suit the business' needs.

Financing

With the necessary administrative issues sorted out in the lawn care business plan. It's time to look into the financial needs of the business venture. Start-up costs is but just one part of the puzzle that makes up the financial requirements. Adequate funds must also be budgeted for monthly recurring expenses like rental, gas, utilities, etc. Short term insolvency or insufficient cash flow had been the major cause of many otherwise healthy businesses foldups, a direct result of poor budgeting by the owners. To ensure that the business does not form part of the statistic, it would be wise to budget at least 6 months to a years worth of funds to meet the running costs of the business.

After arriving at the figure for the needed funds, it's time to look for a source. It could be your own savings, loans from family, mortgaging the home or a business loan from the bank. In which case, the lawn care business plan will have to be very detailed and be able to to convince the financiers that the business is a profitable venture.

This concludes the part of the Lawn Care Business plan that covers setting up the business. The next post will touch on including marketing and business expansion plans to complete the lawn care business plan.