As a landscape business owner, you wear a lot of hats. You run your business, maintain client relationships, manage your team, pay the bills and try to grow. You learn a little about a lot of functions, but you often don’t have the time or desire to be an expert at every role that is required to keep your organization running with optimum efficiency.
In the green industry, most landscape business owners didn’t start their businesses because they love keeping track of financials. But without accurate and timely financial information, how do you make sound business decisions?
“Most of us entered the green industry for the passion that we had for building things outside. The bookkeeping side of the house - it has a lot of different aspects and its really one of the most important aspects of a business.” -James Reid, from Lawn & Landscape Solutions
Like James, most of us would prefer being outside, doing what we love to do. However, as your landscape business grows, it becomes essential to have a good grasp of your financials in order to keep things moving in the right direction. Accurate and timely financial information is essential for making sound decisions that allow you to successfully manage and grow your business.
The benefits include insights into where you are most and least profitable, areas where you can create savings, what you can do to streamline procedures, and more. You’ll also be able to stay compliant with tax requirements like withholding, 1099’s, depreciation and other detail-oriented calculations. The challenge is how to get organized, how to allocate time and team assets and how to capture the right information. If you can’t measure it, you can’t manage it.
Establishing some simple daily, weekly, monthly and annual data collection practices is a basic first step. Implementing standardized financial practices, setting up a practical bookkeeping platform like QuickBooks, and developing a clear chart of accounts that matches your landscaping business model will immediately begin to provide insight into your organization’s financial health and keep you abreast of your financial status all year.
Here are some additional examples of things you need to be doing:
No, you probably don’t. Nor should you! Managing financials and on-going bookkeeping is best given to someone who specializes in this kind of work. Your choices are similar to other specialized HR needs - hire someone, assign an existing team member to get trained and up-to-speed, or outsource. Which one you choose will depend on the size, situation and complexity of your business. Do you need an accountant or a bookkeeper, a full time or part-time staffer? Does it make sense to hire a permanent employee with a salary, benefits and health insurance or to find a competent source for outside bookkeeping services?
One solution you shouldn’t pursue is doing it all yourself. Do what you do best and let your team members do the same. The other solution to avoid is not a solution at all, but it’s often the default - doing nothing but staggering from one bank statement to the next.
Start now to take control of your financials by establishing solid bookkeeping practices in your landscaping business. You’ll benefit in ways that make your initial investment in the effort something you’ll wish you had done years ago. Grow with information, grow with purpose!
Join McFarlin Stanford founding principals Jim Cali and Jason New for this fast and focused workshop on the financial knowledge and standards you need to succeed at managing your green business. Together they’ll cover the fundamentals - from using a standard industry chart of accounts and class systems, to depreciation, supporting journal entries and using your P&L as your additional dashboard.
Take advantage of this opportunity to learn from seasoned professionals who are green industry experts and QuickBooks Certified ProAdvisors.