Location of Your Business
Where are you going to run your business from? Will you work from home, get an office or something else? At the very least, you will need space to store equipment, consumables and stock.
Starting a Landscaping Business
Whether you want to get involved in wholesale design and yard makeovers or you want to provide maintenance and beautification services, there are plenty of opportunities in landscaping. However, because of the expertise, equipment and staff needed, landscaping design has quite a high barrier to entry.
Conversely, simple lawn maintenance businesses can be started by almost anyone. This means that a landscaping business is suitable for entrepreneurs of varying skills, experience and expertise.
Landscaping Business formation guide
In this guide, we’ll explore everything you need to do to set up your landscaping business and maximize your chances for success. We’ll cover:
Understanding the world of the landscaping
Paying taxes and for your landscaping business
Deciding if you’re ready to start a landscaping business
Hiring employees, managing finances and administering your landscaping business
Planning out your landscaping business
Locating other resources for your landscaping business
Determining the best legal structure for your new organization
Following various rules and regulations
And much more
By the time you’ve read through our complete landscaping business guide, you will have all the information you need to set up and manage a thriving landscaping business. Let’s get into it
Understanding the World of the Landscaping Business
Key Landscaping Business and Background Data and Statistics
The size of the landscaping sector may surprise you:
$800B
Revenue in 2017, which is around 160,000 per business.
4.8%
Revenues growing rate of the industry year on year.
15%
Generated revenues of the industry's top 50 landscaping companies.
$16B
U.S. households spent on lawn care and gardening services in 2015.
Most landscapers...
65%
work for single-family residential clients
42%
Design/Building
More specialties include...
23%
Commercial/Industrial
19%
Design/Building
13%
Lawn Care
6%
Tree/snow care or Irrigation (each)
There are around half a million landscaping businesses in the U.S. that employ around 1 million people
Commercial landscaping services account for about 50% of industry revenue, while residential services account for about 30%
57% of businesses made $300,000 or less per year, while 19% made between $300,000 and $1 million and 24% $1 million or more
This all points to the landscaping industry being ripe with new opportunities for focused entrepreneurs, so now might be the perfect time to dive into starting your landscaping business. Incfile is here to help you form your landscaping business and understand the ins and outs of owning a landscaping company.
What Your Landscaping Customers Are Looking for
What your customers need will depend on the type of services you provide and the types of clients you plan to work for. Here are some examples based on what you decide to specialize in:
Landscape design, installation and makeover
A solid portfolio of work combined with a strong, reliable work ethic and good word-of-mouth recommendations
Lawn and yard maintenance
Reliable, well-priced services provided on a regular basis by skilled, polite workers
Residential customers
Competitively-priced services that provide a high value for money
Commercial and industrial customers
Reliable, trustworthy services provided quickly and efficiently
What Are the Main Skills, Expertise and Experience Needed to be a Successful Landscaping Entrepreneur?
There are a variety of skills you will need as a landscape entrepreneur, depending on where you want to focus your business services. Here are some of the main skills necessary:
Hiring
Finding, interviewing and hiring great landscaping employees who can provide the right design, maintenance, installation and other services
People management
Dealing with staff, coverage issues and other people management areas
Marketing
Promoting your landscaping business against a competitive field; local marketing expertise is essential
Service pricing
Creating competitive services with reasonable profit margins, factoring in employee and materials costs
Business creation
Setting up the landscaping business in the first place and finding equipment, staff, vehicles, etc.
Operational management
Ensuring customers are treated well and yard services are provided to the standards you expect
Business administration
Sorting out profits, payroll, financial management, accounting and all the other areas that go into running any successful business
Plan Your Landscaping Business
Before you start your business, there are a few key areas you need to focus on. You will need to establish whether there’s a demand for your landscaping business services, look at potential benefits and pitfalls, understand how your business finances might work and ensure everything is in order.
In short, you need a business plan — here’s how to think about your business idea.
Do Market Research and Validate Your Landscaping Products and Services
Before you launch your landscaping business, you need to understand if there’s a demand for what you’re selling. That means carrying out market research and “validating” your products and services. Here’s how to go about it:
See if there are any market research reports for landscaping businesses
Search locally, nationally or internationally.
Look at who your competitors are in the space
Having competitors is a good thing as it shows there’s a market. You will want to find out what local competitors offer the same services you do.
Talk to clients
Speak with potential customers to understand what they want from your landscaping products and services. Narrow down the types of clientele you want to serve and talk to them about landscaping needs.
Identify your business’s unique selling points (USPs)
These are the areas that will set you apart from competitors and encourage customers to come to you. You might have better pricing, a higher-quality service, faster delivery or some other special feature. Early on, think about offering work at a better price so you can start to build up a portfolio.
Get involved with business communities and discussion groups
Ask questions about landscaping businesses. You can find links to some excellent discussion groups later in the article.
Understand Your Landscaping Business Model and Financial Projections
All businesses need a business model, which is how you will generate sales, provide services and make money. Think about your business model now, because it’s better to have that in place so you can start acquiring customers and generating revenue from day one.
You will also need to look at financial projections for your landscaping business. What are your expected sales and revenues? What is your profitability? How much money will you keep in the business to grow it? How much will you pay yourself and others? If you can, try to plan your revenue for the next month, three months, year and two years.
One of the best ways to build a successful financial future is to sign clients on for recurring services, so you can bill them on a periodic basis. This is especially useful if you provide regular lawn care and yard maintenance.
Write a Business Plan for Your Landscaping Business
Finally, you should put your business plan together. Business plans do vary slightly, but they should cover the following areas:
1
An executive summary with the most important points from your business plan
2
Your goals and what you hope to achieve with your landscaping business
3
A description of your business, background information and context
4
A market analysis and likely demand
5
An overview of how your business is structured
6
Your business model
7
How you will market and sell your offerings
8
Financial projections, revenue and profitability
9
Appendices
We’ve got the perfect guide to writing your business plan.
Choose the Right Business Structure and Register Your Landscaping Business
Now that you have all the background information for your landscaping business, it’s time to make it into a reality. Starts by choosing the right structure or “legal entity” for your business. In the U.S., there are five main business structures. They are:
Sole Proprietorship
This is the "default" business structure and is what your business will be if you decide not to create a more formal structure. We don't recommend this type of business as it doesn't give you the legal protections you need.
Limited Liability Company or LLC
The most common type of business entity. An LLC is fast, simple and inexpensive to setup and maintain. It protects your personal finances and assets and is a great way to start your landscaping business.
Series LLC
This is a special type of LLC entity that's only available in certain states. It allows you to create "mini" LLCs, each with their own limited liability and separate assets, under the umbrella of a master LLC.
S Corporation
This is a more complex type of business and isn't generally recommended for smaller organization.
C Corporation
These are the largest and most complex types of businesses and are far more than the average entrepreneur or business owner will need.
Special Considerations for Setting up a Landscaping Business Entity
For more information on the advantages and disadvantages of different types of businesses, please see our in-depth guide. If you’ve still got questions, we’ve answered them to help you choose the right business structure for your landscaping business.
In most cases our recommendation would be to create an LLC. We have a complete guide to everything you need to do, and we can set one up for your landscaping business. LLC formation does vary from state to state, but we’ve got you covered, wherever you are.
Setting up Your Landscaping Business
Once you've legally created your landscaping business, you’ll need to get some other things in place.
Marketing
You will probably need to build a website, and you will definitely need excellent local marketing expertise.
Employees
It’s unlikely that you will need to hire employees in the early days of your business. Instead, you might work with freelance designers, marketers and similar.
Software
Special software exists to make it easier to run your landscaping business.
Business maintenance
Most states require businesses to file an Annual Report once a year. You will also be expected to pay estimated taxes on what you plan to earn in the current business year. Your federal, state, regional and city business licenses and permits may need to be renewed on a regular basis, typically once a year.
Finances and taxes
What kind of bank account will you get? Do you need a business credit card? How will you pay your business taxes? These are important questions to consider so your landscaping business stays in the green. Here at Incfile, we can even help you file your taxes.
Equipment
What equipment do you need to manage your landscaping business? Depending on the types of services you offer you will need tools like lawnmowers, weed whackers and trimmers. You may also require construction tools, especially if you are doing design and installation. Make sure you understand exactly what you need to spend so you can write it off against business expenses.
The Complete "Start Your Business" Checklist
A Clear and Comprehensive Guide to Starting Your Business the Right Way
Hire Landscape Employees
If you’re just running your landscaping business solo, you don’t need to worry about employees. If you are hiring people to work for you, you will need to know what to do. See our 10 tips on hiring employees.
1
Get an Employer Identification Number (EIN)
Contact the IRS and let them know you will need an EIN for your landscaping business. This is a number you will use to file and pay your taxes. We put together this guide to getting your EIN.
2
Make Sure Your Employees Can Work in the U.S.
Your employees must be legally able to work here. Carry out background checks and ensure they have all necessary legal documentation.
3
Report Employees as “New Hires”
In most cases you will need to report the hiring of employees to your state.
4
Withhold Income and Payroll Taxes
You will need to calculate and keep back income tax so you can pay the appropriate bodies. You will also need to pay the employer portion of the payroll tax.
5
Get worker's compensation insurance in place
As listed above, you will need to make sure you have proper workers’ compensation insurance to cover injuries, illness, medical costs and the like.
6
Pay Employees on a Regular Basis
You will need to run payroll and compensate your employees on a regular frequency. Your state may mandate how often employees need to be paid.
7
Learn About Legal Requirements and Responsibilities to Employees
You do have certain responsibilities and requirements for hiring employees. In addition to getting a proper employment contract in place with them, you have a duty to provide them with a safe working environment, proper training, regular pay and certain other criteria. OSHA covers your health and safety requirements, while the U.S. Department of Labor provides information on other responsibilities.
Social Media and Discussion Groups for Your Landscaping Business
Connecting with other business owners in your industry can be incredibly helpful. Here are some of the best social media and discussion groups:
One of the busiest landscaping forums
A forum for landscape design and installation
A discussion group for lawn maintenance
Lots of great resources for starting a lawn care business
A totally free forum for the residential and commercial lawn care and landscaping enthusiast
A sub-forum on the popular Contractor Talk website
Useful Online Tools for Your Landscaping Business
Here are some really great online tools for managing your landscaping business. They will reduce the time you spend on administration, help you collaborate with others and free up your time to grow and manage your new venture.
Collaboration
Social Media Management
Communication
Email Marketing
Advertising
Customer Relationship Management (CRM)
Customer Support
Human Resources
Legal
Website Development
Analytics
Hiring
Please note: This page contains affiliate links and we may receive a commission if you make a purchase using these links.
Conclusion
As you can see, there are several different types of landscaping service, and with the right approach and expertise you can make a splash in your local marketplace. Look into the types of maintenance and design you want to offer, and you can build a sustainable, thriving business that helps clients keep their grounds looking beautiful.