A Landscaper’s Budget?

Dear Lawn & Landscape Business Owner,

What’s the first step to building a wildly successful lawn or landscape company?

Hint… It’s not buying fancy new equipment, hiring more employees, or landing that dream commercial contract. No, my friend, the first key to success in the Price Right system (covered in detail here) is something far more powerful… yet often overlooked: BUILDING A WRITTEN BUDGET.

A well-crafted budget isn’t just a financial exercise—it’s the blueprint for business success. It provides clarity, direction, and confidence. Without it, you’re flying blind, hoping for profits instead of engineering them into existence.

Let’s break it down. A well-planned budget provides four powerful tools that can take your business to new heights:

1. Overhead Cost Awareness

Do you really know how much your business costs to run? Most landscape contractors don’t. That’s why they struggle with pricing jobs correctly.

Overhead includes all the fixed costs of running your business—expenses you pay regardless of how many jobs you complete like rent, your light bill, and marketing expenses. Some contractors call this “general and administrative expenses” (GAAP accounting folks will recognize this term).

But here’s where many landscapers go wrong: they mistakenly place the cost of field equipment—mowers, trucks, trailers, skid steers—into overhead. That’s a big mistake. These costs belong in direct job costs, not overhead! Misplacing them in your budget means you’re setting yourself up for failure before you even bid your next job.

Why in the world would you want to charge dear old Mrs. Smith for a skid loader you bought when all you need to service her account is a truck, walk behind mower, and a few power tools? Well, that’s what happens if you place field equipment costs into your overhead. We teach this principle in the Profit Builder training events.

We just graduated 13 lawn and landscaping companies from the class this past weekend. We hope you will join us at a Profit Builder this next season soon!

2. A Plan to Hire and Promote Employees

Hiring and keeping employees is one of the biggest challenges in running your landscape business, and the right budget makes it easier. Why? Because when you plan ahead, you know exactly:
✔️ When you plan to hire new crew members
✔️ How much you will pay to attract top talent
✔️ What benefits you will offer to keep ‘em

✔️ How to grow each person via merit raises and incentives

Too many landscape business owners “wing it” when hiring…thinking they have to pay market rates for “experience”. They don’t have a system to recover the costs of holiday and vacation pay or money for health insurance, disability coverage, or retirement plans—benefits that not only protect the owner but make it easier to recruit and retain employees.

With a budget, you understand that it’s okay to pay overtime without breaking your budget. You don’t stress over payroll taxes, worker’s compensation insurance or the liability insurance audit that’s coming in your future. 

Look, making payroll can create big-time stress every week or two. But when you understand the plan to recover all of your costs for your employees, you’ll be able to Price Right with confidence.

3. A Healthy Profit Plan

Here’s a game-changing idea: YOU get to decide how much profit you want to make.

Not Fedzilla. Not the economy. Not your competition.

When you build a budget the right way, you choose your target profit margin first. Then, you reverse-engineer your pricing strategy to ensure you hit that number.

The problem? Most landscapers never do this. They just “hope” for profit at the end of the year. That’s a losing strategy. Profit must be planned, not wished for.

Let me share an often overlooked mistake in adding profit to your landscaping jobs with a real-world example.

When you build a budget the right way, you organize that budget into the format of a Profit and Loss Statement. Also known as the P & L, the mathematical formula for it is quite simple: 

Sales – Expenses = Profit

Larry the landscaper has a goal of making a 15% profit on his landscaping jobs. He figured his total cost to do the work would be $1000. In order to make his 15% profit he used this formula:

$1000 costs x 15% profit = $150 then $1000 costs + $150 profit = $1150 sales price

However, when the sale is recorded on the P & L it shows $1150 in sales and $150 in profit. 

Now let’s look at the math on the P & L.

$150 profit divided by $1150 in sales is NOT 15% – it’s 13%. 

What happened to that 15% profit?

I call it the great disappearing act! The math will cheat you out of 2%. To reach 15% of pure profit, you’ll have to markup your costs by 17.65%. Here’s a helpful % pure profit and % required markup table.

Table: % Pure Profit and % Required Markup

Interesting…the higher your profit goal, the more courage you must have to mark up your costs. We hope this helps you understand how to improve profits and understand (one reason) why you are falling short on your profit goals..

4. A Top-Line Sales Goal

Once you know your overhead, labor costs, and profit target, you can set your top-line sales goal—the revenue number you need to hit to make your business work.

This is a powerful tool because it motivates you. Instead of taking jobs randomly and scrambling to make ends meet, you have a clear revenue target and a plan to achieve it. Every quote, every bid, every sale moves you closer to that goal.

Clarity vs. Chaos

Let’s be honest: landscaping is hard work. But it’s even harder when you don’t have a plan.

A business without a budget is a business in chaos—constant stress, pricing confusion, and profit that disappears like a puff of smoke.

But a business with a well-planned budget? That’s a business in control. The owner has clarity and purpose. The team knows where they’re headed. And when those numbers are dialed in, profit isn’t an accident—it’s a guarantee.

So, my fellow landscapers, it’s time to take control of your financial future. Build your budget, price your jobs right, and watch your business explode with profit.

And if you need help with the step-by-step process, you know where to find me.

Let’s cut the chaos and grow smart—together. (CLICK HERE to set up an initial needs meeting with me!) 

Tony Bass, founder

866-923-0027

PS – Just in case your company is growing and you need a truck that improves productivity, check out the World’s Most Affordable Lawn Truck right here.