Chapter 1: What are the startup costs for a lawn care business?
The cost of starting a lawn care business can be as little as the combined cost of buying a mower and
printing some flyers and marketing your business in your neighborhood. However, the work of doing
everything manually is stressful, so most people want to automate some processes, delegate the more
strenuous tasks to hired labor and market in multiple ways to build a client base. The key costs of
running a legitimate lawn care business include:
Structural and legal expenses
You don’t need any type of permit specifically for a lawn care business, but you do need to get a
business license for your company and a name. Some states have a fictitious name fee and require you to
advertise it. Most states don’t require collecting sales tax on services, but some do. Check with your
state’s department of taxation for the requirements of your state. You also have to register with the
federal government and IRS to get a number for withholding taxes.
Other expenses might include legal fees for setting up a corporation. You also have to get insurance if
you plan to hire staff. Workers’ compensation insurance is mandatory. Your state might also require you
to pay an unemployment insurance premium, which is based on your annual payroll. It sounds complex, but
it is possible to complete these procedures in as little as one day.
Equipment and Materials
The equipment that you need depends on what services you plan to offer. You can expand your services as
the business grows. You’ll need some kind of mowing equipment, edgers and weed-eating equipment. Most
services require a truck, equipment trailer, push mower, riding mower, trimmer, hedge trimmer, leaf
blower and hedge trimmer. Getting all these items can run anywhere from $10,000 to $50,000.
You need a way for people to find your business, and it’s important to get a legitimate company website.
You’ll have to learn how to market digitally - unless you want to begin by passing out flyers, using
signage locally and on your truck and relying on word-of-mouth referrals.
Marketing online can be relatively inexpensive with Pay-per-click (PPC) advertising, social media
marketing, local internet advertising and Search engine optimization (SEO). These are all techniques
that promote your website to people browsing online.
Management costs vary, but at the very least they include setting up an office and phone / answering
service. Apps can be helpful for managing your business at a minimal cost.
You also have to pay any company or employee insurance premiums, which are usually based on estimated
income. You’ll also have to open a business bank account for your company to process checks and make
cash deposits so that you can pay your bills with business checks. The alternative is accepting cash
only, which will severely limit your customers and make it impossible to offer expensive services.
Operational expenses include the cost of hiring staff, making payroll and transporting workers and crews
to job sites. You might have to rent an office and pay utilities. More and more startup companies use
on-demand labor from a pool of workers who are willing to work part-time as needed. You can control and
manage mobile workers through a lawn care app to minimize operating expenses.