If you’re considering starting a landscaping business, you’ll need to know the expenses of running the company beyond the obvious equipment and labor needs. To competitively price jobs that win you work and make a profit, you’ll need to know your total operating costs, including your overhead expenses.


The first obvious expense for any landscaping business is equipment. Depending on what type of work you plan to offer, you’ll need a mower or mowers, aerator, seeder, leaf blower, edger, weed whacker, hoses, chemical sprayer, clippers, bags, rakes and other items. Consider leasing some of these items to test their reliability or until you have the cash to buy. If you don’t own a truck, you’ll need to buy or lease one, and possibly a trailer. Include fuel costs under your equipment expense category, including the cost to get you to job sites and the gas for mowers. While you’ll have costs for seed, fertilizer, flowers, plants and other job-related needs, you won’t need to know these to plan a master budget, since you’ll include these costs for jobs as you bid them.


As you grow, you’ll most likely have enough work that you’ll need help to do the jobs. You’ll probably start with hourly contract help but might someday need employees. In addition to their salaries or wages, include the cost of any insurance and payroll taxes you’ll have. In addition to those who work on landscaping jobs, you might need to hire a landscape architect for design work or other large job. You might need other specialists in the care of lawns, shrubs and trees, as well as a tax professional, marketing person and website designer.


Word of mouth will account for much of your business as you grow, but you’ll need to promote your company. Marketing expenses can include business cards, a website, flyers, truck magnets, lawn signs, coupons and direct-mail efforts.


Much of the work to run your company will be in addition to the on-site landscaping you do. You’ll need to answer phones, create marketing efforts, meet with your vendors, direct your accountant and spend other hours managing your business. Administrative expenses include rent, phone, a filing system, computer, software, licenses, fees, insurance, bank charges, professional dues and subscriptions, offseason equipment storage and utilities. Don’t forget credit card interest if you plan to use plastic to help launch or run your business.


To bid jobs properly, you’ll need to know your overhead. Most jobs will require direct expenses of gas and labor, but that’s only part of the cost you need to cover in your work. Break out all of your costs not related to performing work, such as marketing, administrative expenses and truck payments to determine your overhead. Apply a portion of your overhead to each job, using a formula that’s realistic for you. If you have two people working for your company and know you will work a total of 4,000 hours annually, you can divide your total overhead expenses by 4,000 and add that figure to each job hour you bid. For example, if you anticipate $60,000 of annual overhead, you will need to bill clients $15 for every hour you work for them to cover your overhead expense. Add to that your direct fuel and labor costs, then add your desired hourly profit to accurately bid on work.