No Margin, No Mission
Jeffrey Scott
Consultant and Coach to Lawn and Landscape Business Owners. Author, Investor, Entrepreneur.
In the non-profit world of hospital care, the phrase “No Margin, No Mission” is used to remind those in charge that it is ok for a hospital to be fiscally responsible and make decent margins.
I feel the same message needs to be embraced by our industry, the world of lawn and landscape.
Once in a while, I will peruse some landscape?Facebook ?groups, and see questions asked about margins. The advice given makes me cringe because it never fully explains how to make money and scale a profitable business. In fact, much of the advice will keep your business small and keep you stuck.
Some Words To Live By:
In January during my?Financial Master Class ,?I measured the net profit and the balance sheets of over 150 landscape firms and found that on average, balance sheet equity rose up, but profitability did not. Especially when I made attendees remove PPP from their profit and loss statements, but not their balance sheets.
These heavier balance sheets give people a false sense of security.
Numbers Do Lie
Case in point, I have a new landscape firm (around 7M in bid build) that just joined my?high-impact peer groups , and when the gentleman put together his numbers removing his PPP money, his P/L shifted from a profit of 250,000 to a loss of 150,000. His reaction was, “But I made money!”. My response was, “Only because the government gave you money”.
We have to do a better job as an industry, learning how to earn a good (if not great) margin.
It’s not rocket science, but luckily it is a science that everyone can learn.
领英推荐
Commercial Businesses Can Make Money, Too
A friend of mine just sold his business, and the valuation he received was sky high! How did he pull this off?
The timing was right but even more than that:
With his buyout, he earned enough money to buy a small island and retire.?
Instead, he rewarded his employees and gave them money, and he is soldering on.?
Your Challenge: Become Financially Savvy
You got into this industry because of your personal passion, but that’s not enough. You need a healthy margin to keep your mission alive.?
You got this!
Regards, Jeffrey!